News

Category: General

Minister Hanafin said “just a year ago, I launched a booklet - Working with your spouse: how it affects your social welfare contributions and entitlements (SW124) – which clarified that spouses who operate in a ‘commercial partnership’ may be brought into the social insurance system. In this way, both spouses incur a liability to pay self-employed PRSI and build up entitlement towards a contributory State Pension and other Social Welfare benefits.”

“The response to this publication has been most encouraging. Already, 233 people who previously would have had little or no entitlement to benefit have been brought into the social insurance system. Detailed examination of the remaining applications is ongoing, but given the trend so far it is obvious that many more are set to realise their entitlement.”

A typical example of the applications coming in to the Department of Social and Family Affairs is where a farmer’s wife, sometimes having raised a family, takes an active part in running the family business but the tax and PRSI returns continue to be made in her husband’s name only.  In circumstances such as this it is often found that the woman should have had a liability to pay self-employed PRSI. When this liability is paid a backdated PRSI contribution record is created, which can lead to entitlement to a contributory State Pension.

“Thus far the majority of people applying for commercial partnership status have been women working on family farms. However, we have also had significant numbers of applications from people working with their spouse in the services sector, one such case being where a couple ran a restaurant together but the tax and PRSI returns were made by the husband” said Minister Hanafin.

Minister Hanafin went on to say “if you think you are eligible for commercial partnership status to get a copy of the leaflet from our website – www.welfare.ie and study it carefully.” 

The Minister sounded a note of caution too, saying that the Department of Social and Family Affairs and the Revenue Commissioners are committed to offering as much assistance as possible to customer’s considering business partnership, but couples should consider the details in the leaflet carefully before proceeding. Depending on the particulars of each case, a liability may result in the applicant having to pay a substantial amount to the Department, before any claim for pension can be considered. “It is also crucial that they seek both legal and financial advice before approaching either body. Every family is different and couples need to be sure that business partnership is right for them.”