Heather Humphreys (Cavan-Monaghan, Fine Gael)
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Approved Retirement Funds, or ARFs, are funds managed by a qualifying fund manager into which an individual may invest the proceeds of their pension fund when they retire. Any amounts withdrawn from an ARF are referred to as a distribution.

Under social welfare legislation, any payments received by way of pension are not regarded as reckonable emoluments for the purposes of self-employed Pay Related Social Insurance (PRSI). However, unlike annuity products, ARFs are not pensions but investment products and are treated as assets. As such, distributions from ARFs are liable for Class S self-employed PRSI and not Class A as referred to in the Question.

Distributions after age 66 are not liable for Class S PRSI deduction; they are recorded under PRSI Class M, that is no social insurance liability.

If any person has concerns about how a distribution from an ARF is being treated for PRSI purposes, they should contact their fund manager to ensure that the correct PRSI Class is being returned.

It should be noted that the Class S PRSI contributions credited to a person’s record as a result of ARF distributions may entitle the person to the range of social insurance benefits available to Class S contributors.

I trust this clarifies the matter for the Deputy.