The Department of Social Protection has had to hire additional staff to deal with a backlog of thousands of PRSI rebate claims from workers, some of whom have waited years for their applications to be processed.
Of the 16,381 claims currently being processed by the department, more than half are at least six months old, 1,761 are more than 12 months old, 71 are three years old, and 41 are more than four years old.
PRSI payments are refunded in a number of situations, including where contributions were paid at an incorrect rate, for example when a deduction is made at the class S (self-employed) rather than is class A (employed) rate, or when a person is issued with a certificate exempting them from PRSI liability.
Most workers earning more than €352 per week pay PRSI at 4 per cent, while employers pay PRSI on employee’s income at a rate of up to 10.75 per cent.
Barry Flanagan of taxback.com said it was usual for his clients to wait between six months and two years for PRSI and health levy refunds, while PAYE refunds from the Revenue Commissioners can be made within a matter of weeks.
Overtime
The department said there was a backlog of applications and that measures had been taken to address the problem, including the employment of four additional temporary staff and allocation of overtime. It has also begun to develop a new IT system to improve the processing of refunds.
In one case a small business applied for a refund of some €19,000 after incorrectly paying employers’ PRSI. The refund was given nine months after the application was lodged.
Colm Hedderman of TaxAssist Accountants, who made the application on behalf of the company, said he informed the department the business was suffering from cashflow problems but was told it was not possible to expedite the application due to the backlog.
‘Expedite applications’
The department said that older claims are usually processed first but “it will expedite applications to facilitate people who are experiencing difficulties”.
It said the processing time for applications “can vary considerably depending on the work history of the applicant; whether there are legal issues to be resolved before financial calculations can be prepared and payments issued; whether there are decisions to be made regarding the correct class of PRSI that an applicant and/or employer has been paying”.
A further 405 workers who requested a refund of the health levy – which was replaced by the Universal Social Charge in 2011 – deducted from their earnings in 2008, 2009 and 2010 have not yet been repaid.
The deadline to apply for health levy refunds from 2010 was December 31st last.
Workers who earned more than €500 in some weeks but less than €26,000 per year were charged the health levy in respect of those weeks despite being exempt, with the onus falling on workers to apply for a rebate.
