I’m going to take some time off work to look after my children. What effect will this have on my contributions for the State pension?
Under the Homemaker’s Scheme, time you spend out of the workforce caring for children or a person with a disability can be disregarded when calculating your entitlement for a State Pension (Contributory). The scheme came into effect on 6 April 1994 (time spent homemaking before this is not taken into account).
You do not get credits for years spent out of the workforce. Instead these years will be disregarded when working out your entitlement to a State Pension (Contributory). However, you may get credits for the remainder of the year you leave the workforce, and for part of the year when you rejoin the workforce.
A homemaker, for the purposes of the Homemaker’s Scheme is a man or woman who provides full-time care for a child under the age of 12 or an ill or disabled person aged 12 or over. A homemaking year is a year in which you are out of the workforce for the full tax year. Up to a maximum of 20 homemaking years can be disregarded when working out your entitlement to a State Pension (Contributory).
To qualify for a State Pension (Contributory) you must have a minimum yearly average number of contributions from when you entered social insurance to pension age. The Homemaker’s scheme provides that full contribution years spent caring in the home are disregarded in calculating a person's yearly average number of contributions. Take, for example, a woman who started work in 1985, took 10 years out of work to care for children from 1995 to 2005 and then returned to work for another 20 years before retiring in 2025 and applying for a State Pension. Her yearly average would be calculated over 30 years instead of 40 years when the 10 years spent in the home are disregarded.
Further information is available from the Citizens Information Centre below.
Know Your Rights has been compiled by Boyle Citizens Information Centre which provides a free and confidential service to the public. Tel: 0761 07 6330
Address: Elphin Street, Boyle, Co. Roscommon
Information is also available online at citizensinformation.ie and from the Citizens Information Phone Service - 0761 07 4000