Michael Ring (Mayo, Fine Gael)
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Question 306: To ask the Minister for Social and Family Affairs if the PRSI contributions paid by people who are jointly assessed entitles them both to a State contributory pension, in their own right, on reaching the age of 66 years. [16044/06]

Séamus Brennan (Dublin South, Fianna Fail)
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Joint assessment is not relevant for social insurance purposes and in turn building entitlement to the state contributory pension. Liability to PRSI is assessed within its own legislative framework and provisions under income tax legislation are not relevant in relation to the calculation of social insurance liability.

The accrual of PRSI contributions and class at which they are paid may differ according to differing circumstances as follows. Where spouses are actively engaged in a commercial enterprise as a business partnership, they are treated as individual self-employed contributors and are liable to social insurance contributions. These contributions enable them to build up an insurance record in their own right and to receive accruing benefits, including maternity benefit. Whereas income may be aggregated for income tax under joint assessment, PRSI is assessed and levied on each of the individuals separately, against the reckonable income received respectively.

Where a family business is incorporated as a limited company, spouses involved in the business pay PRSI Contributions either as employees or as self-employed contributors, depending on whether a contract of service exists or not. Joint assessment for tax purposes is not pertinent.

Where a person is employed under a contract of service (i.e. as an employee) by his or her spouse, the employee is an 'excepted' contributor under social welfare legislation and no liability arises. The fact that the couple may be jointly assessed does not override this exception.

The State Contributory Pension is payable to individuals over 66 years who have accrued the requisite number of contributions throughout their working life. Where one of a couple does not have sufficient contributions paid or credited in their own right, payment of a qualified adult increase in the spouse's pension may be made.