The Gazette 1990

GAZETTE

' APRIL

1 9 90

Social Welfare announced that, in future, refunds of the old age (contributory) element of the PRSI contribution would be made to both employed and self-employed contributors who enter insurance after reaching 56 years and who do not qualify for a non-contributory old age pension. The necessary regulations are currently being" drafted and the question of the payment of interest on the amounts refunded is being considered in this context. Finally, you also refer in your letter to the tax treatment of self- employment contributions. In de- termining the rate of self-employ- ment contribution the Government had regard to the views of the National Pensions Board in the matter. A majority of the members of the Board recommended that, on grounds on equity, the rate of contribution should be the same as the combined employer/employee rate for old age and widow's and orphan's pensions - that is a rate of 6.6%, when allowance is made for the tax relief on the employer's contribution. The Board recog- nised, however, that in setting the rate of contribution the Govern- ment would have to take into account the ability of the self- employed to pay the rate recom- mended. In the event the Government set the contribution rate at 5% and this rate is being phased in over a three-year period from April 1988 to April 1990. It should also be noted in this regard that making contributions tax deductible would be regressive in that it would benefit only those on higher incomes who pay tax and would be of most benefit to those on higher incomes who are liable for tax at the higher rates. To maintain existing net levels of PRSI contribution income it would be necessary to either increase or abolish the present income ceiling for PRSI purposes, which is cur- rently £16,700, and/or increase the percentage rates of contributions. The first option could effectively cancel out the net benefit to many of those on higher incomes of having contributions tax deductible. The effect of the second option would be to shift part of the burden of financing social insurance bene- fits from those on higher earnings, who would be paying a reduced amount of PRSI because their con-

tributions would be tax deductible, to those on lower earnings, who would not have any tax liability. Yours sincerely, Enda Flynn, Planning Unit, Department of Social Welfare,

INSOLVENCY PRACTITIONERS ASSOCIATION A Meeting will be held on Thursday 26th April 1990 at 6.00 p.m. at Milltown Golf Club The topic to be discussed ' '/nso/venc y De velopmen ts'' Speakers: Ray Jackson, Rory O'Ferrall, Frank Sowman, John Glackin. Anyone interested please contact: John Glackin Gerrard Scallan & O'Brien, Hainault House, 69-71 St. Stephen's Green, Dublin 2. Tel: 780699.

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FAMILY LAWYERS ASSOC I A T I ON FORTHCOMING SEMINARS: 25th April - Conveyancing and Family Law 30th May - Legal Aid 12th July - Enforcement of Foreign Judgments VENUE/TIME: 7.00p.m., Buswell's Hotel, Molesworth Street, Dublin. ANNUAL MEMBERSHIP: For the year 1989/90 is £15 and entitles every member to free copies of the Association's Journal and attendance at seminars. The first edition of this year's Journal contains a comprehensive guide to the Judicial Separation and Family Law Reform Act, 1989. SUBSCRIPTIONS TO: Barbara Seligman, Law Library, P.O. Box 2424, Dublin 7. Cork Area: Rosemary Horgan, The Law Centre, 24 North Mall, Cork.

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