State Pension (Transition)

Rules

To get a State Pension (Transition) you must:

• Be 65 years of age
• Be under 66 years of age
• Be retired from work
• Have enough social insurance contributions.

Retired

Being retired means that you must not be in insurable employment or self-employment. If you have earnings, they must be less than €38 a week from employment or €5,000 a year from self-employment. If you have an income from savings or investments, you could be liable for self-employed PRSI but you can still get a State Pension (Transition) if you are not actually engaged in self-employment.

This condition ends when you reach the age of 66 and transfer to the State Pension (Contributory).

Social insurance contributions

You must have:

• Paid social insurance contributions before a certain age
• Paid certain number of social insurance contributions
• A certain average number of contributions over the years

Paid social insurance before a certain age

You must have first started to pay social insurance contributions before the age of 55.

Number of paid contributions

• If you reach pension age on or after 6 April 2012, you need to have 520 paid contributions. In this case, not more than 260 of the 520 contributions may be voluntary contributions. If however you were a voluntary contributor on or before 6 April 1997, you may meet the requirement if you have a total of 520 contributions and at least 156 paid contributions.
• If you reached pension age on or after April 6th 2002, you needed to have 260 paid contributions.
• If you reached pension age before April 6th 2002, you needed to have 156 qualifying paid contributions (a total of 3 years but they did not have to be consecutive). This means that you must have paid a full stamp prior to 1979 or Class A, E, F, G, H, N contributions since then.

In some cases, contributions paid before 1953 into the then National Insurance Scheme may be taken into account in order to meet the requirement of paid contributions. In fact, each 2 such contributions are counted as 3. But if they are taken into account, the average must be measured from 1953.

Average number of contributions per year

You must have an average number of contributions. This is probably the most complex aspect of qualifying for a State Pension (Transition).

• Normal "average" rule

The normal average rule states that you must have a yearly average of at least 24 full-rate contributions paid or credited from the year you first entered insurance or from 1953, whichever is later. An average of 24 entitles you to a minimum pension; you need an average of 48 to get the full pension.

• "Alternative" average rule

The alternative average rules can only be used by people who reach pension age on or after 6 April 1992.

It requires that you have an average of 48 contributions (paid or credited) per contribution year from the 1979/80 tax year to the tax year before your 65th birthday. This average would entitle you to a full pension. There is no provision for a reduced pension when this alternative average is used.

So, if you reach 65 years of age on or after 6 April 1992, your average will be looked at in two ways - the usual average will be assessed and the alternative average will be assessed. Most employed or formerly employed people will be able to meet the alternative average. The alternative average will probably be looked at first because it is easier to assess. If you do not have an average of 48 from 1979 then the usual method of assessing the average will be looked at and you may get a reduced pension.

Contributions paid abroad

If you have paid social insurance contributions in another EU member state or a country with which Ireland has a bilateral social security agreement, they can be used to help you qualify for a State Pension (Transition). More information is available in our document about combining your social insurance contributions from abroad to qualify for a social welfare payment.

Pro-rata pensions

Mixed insurance pro-rata pension

Mixed insurance arises when a person spends part of his/her working life in the public service paying modified insurance and part in the private sector paying Class A (or, since April 1988, self-employed and paying Class S). If you do not have enough full-rate social insurance contributions to qualify but you have paid some modified social insurance contributions as a civil or public servant, you may be able to qualify for a mixed insurance pro-rata pension.

To get a pro-rata pension with mixed insurance you must have:

• Paid social insurance before the age of 55
• The correct number of paid contributions when you reach retirement (see 'Number of paid contributions' above)
• A mixture of full and modified contributions, which when added together give you a yearly average of 24 from the time you first entered insurance or 1953, whichever is later, to the end of the contribution year before your 65th birthday.
• Failed to qualify for a pension under EU regulations or under reciprocal arrangements with other countries or only qualified for a pension at a lower rate than this pro-rata pension would give you.

Intermittent insurance and pro-rata pensions

Prior to 1974 there was an income limit on making social insurance contributions, this means you may have been in and out of insurance. You cannot get a pro-rata State Pension (Transition) if you have intermittent social insurance, however, you may get a pro-rata State Pension (Contributory).

The Department of Social Protection has published 'Working it out - A Guide to the State Pension (Transition)' and this may help you to work out if you qualify for a State Pension (Transition).