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How to calculate your State Pension (Contributory) rate
From Department of Social Protection
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- How can I estimate my State Pension (Contributory) rate?
- How many contributions do I need to qualify for State Pension (Contributory)?
- How can I improve my rate of State Pension (Contributory)?
- What methods are used to calculate your State Pension (Contributory)?
- Using the Total Contributions Approach
- Using the Yearly Average Method
From 1 January 2024, the way you calculate your State Pension (Contributory) is changing. Details of these changes are outlined here.
In addition, you will be able to drawdown your State Pension (Contributory) at any age between age 66 and 70. Your pension drawdown date will be the date from which you want to start receiving State Pension (Contributory).
Please note
Terms and conditions will apply, as per forthcoming legislation.
Terms and conditions will apply, as per forthcoming legislation.
To help estimate the rate of State Pension (Contributory) you may receive, you can request a copy of your Contribution Statement on MyWelfare.ie.
Your Contribution Statement is a summary of your pay-related social insurance (PRSI) record contributions in Ireland. When calculating your rate of State Pension (Contributory), the department uses your Contribution Statement to identify:
- your working history
- any time you spent on payments from the Department of Social Protection
- any time you spent caring
Your Contribution Statement is divided into different columns. Each column is explained below:
- Year (Column 1): Relevant year
- Paid Contributions (Column 2): This column contains details of your paid contributions which have been returned by your employer or any paid self-employment contributions for each relevant year
- Credited Contributions (Column 3): This column contains details of your credited contributions linked to any social welfare payments you received
- Long-Term Carers Contributions (Column 4): This column contains details of contributions for any approved period you have provided full-time care to an incapacitated person. You need to have a total of 1040 periods/weeks (20 years) of care in this column, before they can be used in Column 5
- Reckonable Contributions for Pension (Column 5): This column contains details of your contributions which count towards the State Pension (Contributory)
- Reckonable Credited Contributions for Pension (Column 6): This column contains details of your credited contributions which may count towards the State Pension (Contributory)
- Total Reckonable Contributions and Credited Contributions (Column 7): This column provides a total figure of your reckonable contributions and reckonable credits
To calculate your State Pension (Contributory), the department will consider any contributions that are on your record up to your chosen pension drawdown date.
In general, you need at least 520 paid contributions (10 years of contributions) to be entitled to the State Pension (Contributory). These contributions might be ones that were either:
- Paid Contributions (Column 2), or
- Long-Term Carers Contributions (Column 4)
For each year, a maximum of 52 contributions are considered for State Pension (Contributory) purposes. Once you have a total of 520 Reckonable Contributions (10 years) for Pension (Column 5), you will qualify for a rate of State Pension (Contributory).
You will get Long-Term Carers Contributions once you have spent more than 20 years providing full-time care to an incapacitated person. The Long-Term Carers Contributions column (Column 4) will include any identified periods of care you have been awarded. Information on how to apply for Long-Term Carers Contribution Periods is available here.
Once this column (Column 4) contains at least 1040 contributions (20 years) during your working life, you can add these to Paid Contributions (Column 2) up to a maximum of 52 contributions per year in Reckonable Contributions for Pension (Column 5).
Credited Contributions are PRSI contributions which may be awarded to a person getting a payment from the Department of Social Protection.
Credited Contributions can help you qualify for a higher rate of State Pension (Contributory).
All identified Credited Contributions are included in the Contribution Statement (Column 3) and the Reckonable Credited Contributions for the State Pension (Contributory) are also shown (Column 6).
The use of Reckonable Credited Contributions (Column 6) will depend on the calculation method used to decide on your rate of State Pension (Contributory).
If you spent time caring for a period or periods of less than 20 years, or where that care is not included under the conditions for Long-Term Carers Contributions, you may qualify for the HomeCaring Periods or the Homemaker’s Scheme.
These can help you to qualify for a higher rate of State Pension (Contributory) once you meet the qualification criteria.
The HomeCaring Periods Scheme is only used in a Total Contributions Approach calculation.
HomeCaring Periods may be awarded to you if you were born after 31 August 1946 and provided full-time care for a child or children under 12 years or a person who needed an increased level of care. A HomeCaring period may be awarded for each week during which you were not employed, including self-employment, in receipt of a social welfare payment, or otherwise signing on for credits.
Your Contribution Statement will include any HomeCaring Periods you have been awarded.
The Homemaker’s Scheme is only used in a Yearly Average Method calculation.
The Homemaker's Scheme was introduced on 6 April 1994 to support people who give up work to take care of a child under the age of 12 or a person over 12 who is incapacitated and requires full-time care. Only periods after this date can be taken into account, up to a maximum of 20 years.
Under the Homemaker’s Scheme, any years that you spent as a homemaker (since 6 April 1994) are ignored or disregarded when working out your yearly average contributions for a State Pension (Contributory). Only full years can be ignored or disregarded.
Your Contribution Statement will include a breakdown of any years qualifying under the Homemaker’s scheme.
There are a number of ways to qualify for State Pension (Contributory). The majority of customers are assessed for State Pension (Contributory) using either:
- the Total Contributions Approach, or
- the Yearly Average Method
Please note
From January 2025, there will be a 10-year phased removal of the Yearly Average Method, which means that all pensions will be calculated using the Total Contributions Approach by 2034. Further information about these changes is available here.
When you submit your State Pension (Contributory) application form, the department will assess your entitlement to State Pension (Contributory) using all available calculation methods to ensure you are paid the highest rate possible.
If you will receive the maximum rate of State Pension (Contributory) using the Total Contributions Approach, no further calculation is necessary.
If a Yearly Average Method results in a higher rate of State Pension (Contributory) than a reduced rate Total Contributions Approach calculation, the rate using the Yearly Average Method will be awarded to you.
It is not possible for the department to advise you of your State Pension (Contributory) rate before we have received your application form.
The Total Contributions Approach (TCA) is only available to those born on or after 1 September 1946.
This approach has three elements to it:
- 1. The total number of Reckonable Contributions for Pension (Column 5)
- 2. Reckonable Credited Contributions for Pension (Column 6) (maximum of 520 credits (10 years) used in the calculation)
- 3. HomeCaring Periods awarded for time spent caring for children aged 12 or under or an incapacitated person (maximum of 1040 periods (20 years) used in the calculation)
Please note
The combined total of Reckonable Credited Contributions and HomeCaring Periods cannot be more than 1040 (20 years).
If you have no HomeCaring Periods, the maximum number of Credited Contributions that can be used in the calculation is 520 (10 years).
If you have no credited contributions, the maximum number of HomeCaring Periods that can be used is 1040 (20 years).
To receive the maximum rate of payment, the addition of the 3 elements need to total at least 2,080 (equivalent to 40 years).
If your total is less than 2,080, your rate will be a percentage of the maximum rate of pension.
| Reckonable Contributions for Pension (Column 5) | + | Reckonable credited contributions for pension (Column 6) (max of 520 can be used) | + | HomeCaring periods (max of 1040 can be used) | = | Total for TCA Calculation |
If 'Total for TCA calculation' figure is less than 2080, the person will qualify for a reduced rate pension which is calculated as follows
| Total for TCA Calculation | ÷ | 2080 | X | 100 | = | % of maximum rate which is rounded to 2 decimal places | |
To find the actual rate payable, multiply the % of maximum rate by the current maximum rate of State Pension (Contributory). See the example below:
A person born in 1957 has 947 Reckonable contributions for pension, 855 Reckonable credited contributions for pension and 350 useable HomeCaring Periods.
| 947 Reckonable contributions for pension | + | 520* Reckonable credited contributions for pension | + | 350 HomeCaring Periods | = | Total for TCA Calculation of 1,817 |
Please note
*In this example while the person has 855 Reckonable credited contributions for pension, the cap of 520 (10 years) credited contributions has been applied.
When the capped credits are combined with the HomeCaring Periods, as the figure is less than 1040 (520+350=870) all of the HomeCaring Periods can be used in the calculation.
As the 'Total for TCA calculation' is less than 2080, the person qualifies for a reduced rate of pension. The reduced rate pension is calculated as follows:
| Total for TCA Calculation 1,817 | ÷ | 2080 | = | 0.8735 | X | 100 | = | % of maximum rate, 87.35% | |
| % of maximum rate 87.35% | X | maximum rate of SPC €277.30 | = | Rate payable €242.30 | |||||
You can find the contributions which will be used to calculate your rate of State Pension (Contributory) in the Total Reckonable Contributions and Credited Contributions column (Column 7).
This figure is made up of the Reckonable Contributions for Pension (Column 5) and Reckonable Credited Contributions for Pension (Column 6) and it will not exceed 52 contributions in each year.
Under the Yearly Average Method, your average is calculated using your Total Reckonable Contributions and Credited Contributions (Column 7) and dividing this by the number of years between when you entered into insurable employment in Ireland and your chosen pension drawdown date.
The maximum rate of payment is available to those with an average of at least 48 and the minimum rate of payment is paid to those with an average of at least 10. In between these two figures, rates are divided into bands.
There are 6 yearly average rate bands, and each represents a personal rate of pension:
| Yearly Average Contributions | Personal rate of pension |
| 48 or over (maximum rate) | €277.30 |
| 40 – 47 | €271.90 |
| 30 – 39 | €249.30 |
| 20 – 29 | €236.10 |
| 15 – 19 | €180.70 |
| 10 – 14 | €110.80 |
Count all the Reckonable Contributions and Reckonable Credited Contributions (Column 7) on your Contribution Statement, from your date of entry to the last completed tax year before your chosen pension drawdown date.
Count all the number of years from the year of entry into insurable employment to the last completed tax year before your chosen pension drawdown date. Include the last completed tax year in the count. Full years spent on the Homemaker's Scheme can be used to reduce the number of years to divide by so that these years do not disadvantage you.
From January 2002 to date the tax year runs from January to December each year.
- There is a short tax year in the 2001 year, due to the change in the tax years (which creates an additional year in calculating the yearly average).
| All reckonable contributions and credits | ÷ | Number of years to divide by | = | Yearly average | |
This is an example of a person born in 1957. They began working in August 1978 and worked part-time. They ceased employment between 1979 and 2005 and were not on any social welfare payments or caring for anyone during this time.
In 2005, they returned to part-time employment, continuing to work until they retired from work in 2022 and they have chosen age 66 as their pension drawdown date, which they will reach in 2023. In this example, count all the Reckonable Contributions and Reckonable Credited Contributions from the 1978/79 year on the Contribution Statement to the end of December 2022.
To find the 'Number of years to divide by', count the numbers of years from 1978 to 2022 inclusive. 2022-1978 = 44 +1
| 748 Reckonable Contributions and Credits | ÷ | Divided by 45 years | = | Yearly Average of 17 | |
This would fall into the Rate Band 15 – 19 and be equal to €180.70 per week based on today's rates of State Pension (Contributory).
If a person has paid PRSI contributions in the year 1979/1980, this year can be used as the first entry into PRSI contributions to determine the “Number of years to divide by" in the Yearly Average Method calculation. The result of this calculation must be at least 48 in order for this calculation to apply.
If it is less than 48, the Yearly Average Method calculation will be used.
If a person started paying class S PRSI on 6 April 1988 (the date of introduction of PRSI contributions for the self-employed), 1988 can be used as the first entry into PRSI contributions to determine the “Number of years to divide by" in the Yearly Average Method calculation, provided that they satisfy date of entry prior to age 56 on that date. The result of this calculation must be a minimum of 10 in order for this calculation to apply.
If it is less than 10, the Yearly Average Method calculation will be used.
Further information about how to use your Contribution Statement to estimate your State Pension (Contributory) rate is available in this document:
