It has been a while in coming, but from December 1st some 326,000 self-employed people will be entitled to long-term sick pay, giving the safety net of State income support to this cohort for the first time.

The invalidity pension, paid at a weekly rate of €198.50, with possible increases for an adult dependant and child dependants is a payment for people who cannot work because of a long-term illness or disability, and is not means tested. The payment is taxable, however.

The move is expected to benefit everyone from small-business owners, farmers, tradespeople, freelances, contractors and professionals, and is expected to cost in the region of €23 million in 2018. It had been thought that the PRSI rate of 4 per cent would have to be increased to cover the costs of extending the benefit, but Minister for Social Protection Regina Doherty confirmed that the rate will stay at 4 per cent.

Self-employed workers who are currently out of work due to illness will now be able to claim the pension, provided that they have the relevant PRSI contributions on their social insurance record.

Ms Doherty said the move was in line with the Government’s policy “of making work pay and encouraging self-employment and entrepreneurship”.

“This measure will give the self-employed access to the safety net of State income supports if they have a serious illness or injury that prevents them from working. It is based solely on their PRSI contributions, it is not means assessed and whatever savings or assets they have will not affect their payment. Similarly, if their partner is working, that income will not affect the payment of the invalidity pension.”

To qualify for the payment, applicants will need 260 PRSI paid contributions (class A, E, H or S) since they started paying social insurance and 48 PRSI paid or credited contributions (class A, E, H or S) in the last complete contribution year or the second-last contribution year before the date of their claim.

Successful applicants for the pension will also receive a free travel pass, which is not means tested, and may also qualify for extra means-tested social welfare benefits such as the household benefits package.

Self-employed workers already receive benefits such as maternity and paternity leave and the State pension, but had long been looking for the protection sick pay offers.

Earlier this year, the self-employed received access to the treatment benefit scheme, which includes free eye tests, dental examinations and contributions towards the cost of hearing aids, with additional dental and optical benefits being provided since October for both the self-employed and employees. Those who work for themselves will also pay €200 less in tax in 2018, following an increase in the earned-income credit to €1,150 in October’s budget.