Notice of the making of this Statutory Instrument was published in

"Iris Oifigiúil" of 18th July, 2014.

I, JOAN BURTON, Minister for Social Protection, in exercise of the powers conferred on me by sections 2(1) (amended by section 6 (1) of the Social Welfare and Pensions (Miscellaneous Provisions) Act 2013 (No. 20 of 2013)) and 4 (adapted by the Social and Family Affairs (Alteration of Name of Department and Title of Minister) Order 2010 ( S.I. No. 186 of 2010 )) of the Social Welfare Consolidation Act 2005 (No. 26 of 2005), hereby make the following Regulations:

Citation and construction

1. (1) These Regulations may be cited as the Social Welfare (Consolidated Contributions and Insurability) (Amendment) (No. 2) (Excepted Emoluments and Income) Regulations 2014.

(2) These Regulations and the Social Welfare (Consolidated Contributions and Insurability) Regulations 1996 to 2014 shall be construed together as one and may be cited together as the Social Welfare (Consolidated Contributions and Insurability) Regulations 1996 to 2014.

Definitions

2. In these Regulations-

"Principal Regulations" means the Social Welfare (Consolidated Contributions and Insurability) Regulations 1996 ( S.I. No. 312 of 1996 );

"Regulations of 2013" means the Social Welfare (Consolidated Contributions and Insurability) (Amendment) (No. 2) (Contributions by Certain Employed Contributors) Regulations 2013 ( S.I. No. 236 of 2013 ).

Excepted emoluments

3. Article 50A (inserted by article 5 of the Regulations of 2013) of the Principal Regulations is amended by inserting the following paragraph after paragraph (g):

"(ga) any amount charged, in accordance with section 790AA of the Act of 1997, to income tax under Schedule E in respect of relevant emoluments within the meaning of section 790AA(3)(a) of the said Act,".

Exclusions from reckonable income

4. Article 50B (inserted by article 5 of the Regulations of 2013) of the Principal Regulations is amended-

(a) in paragraph (d), by substituting "Act of 1997," for "Act of 1997, and",

(b) in paragraph (e), by substituting "Act of 1997," for "Act of 1997.", and

(c) by inserting the following paragraphs after paragraph (e):

"(f) any encashment amount or any deemed encashment amount, as the case may be, referred to in section 787TA of the Act of 1997, and

(g) any amount charged to income tax under Case IV of Schedule D in accordance with section 790AA of the Act of 1997.".

Commencement

5. These Regulations shall have effect-

(a) in so far as they relate to any amount referred to-

(i) in paragraph (ga) (inserted by article 3 of these Regulations) of article 50A of the Principal Regulations, and

(ii) in paragraph (g) (inserted by article 4 of these Regulations) of article 50B of the Principal Regulations,

from 1 January 2011,

and

(b) in so far as they relate to any amount referred to in paragraph (f) (inserted by article 4 of these Regulations) of article 50B of the Principal Regulations, from 8 February 2012.

GIVEN under my Official Seal,

16 July 2014.

JOAN BURTON,

Minister for Social Protection.

EXPLANATORY NOTE

(This note is not part of the Instrument and does not purport to be a legal interpretation.)

In general, self-employed persons aged from 16 up to 66 years are compulsorily insured as self-employed contributors if they are in receipt of reckonable income or reckonable emoluments. Reckonable income is defined in general as income to which the Tax Acts apply, for example, income earned from a trade or profession carried on in the State or elsewhere, as well as other unearned income, which is taxed under Revenue’s self-assessed system of tax collection. Reckonable emoluments are defined as income which is not derived from insurable employment and to which the PAYE tax collection system applies.

These Regulations specify the following income which is subject to tax but which is not to be regarded as reckonable income or reckonable emoluments for the purposes of liability for a PRSI Class S self-employment contribution-

(a) any encashment amount or deemed encashment amount referred to in section 787TA of the Taxes Consolidation Act 1997 , with effect from 8 February 2012, and

(b) any amount charged to income tax in accordance with section 790AA of the Taxes Consolidation Act 1997 , with effect from 1 January 2011.

Section 787TA of the Taxes Consolidation Act 1997 relates to the early encashment of certain amounts of private pensions by certain individuals in the public sector who had previously been self-employed.

Section 790AA of the Taxes Consolidation Act 1997 relates to the taxation of retirement lump sums paid to an individual in excess of €200,000.