Auto-enrolment in Ireland: what employers need to know

Irish businesses have entered a new era for workplace pensions.  

With My Future Fund (MFF), also known as automatic enrolment and auto-enrolment, officially in effect as of 1 January 2026, the way employers handle retirement savings has shifted. 

However, navigating the complexities of Ireland’s new auto-enrolment legislation can be daunting for employers.

That’s why we’ve created this comprehensive guide, with insights from our Lead Product Manager, Niall Clarke.

Whether you need extra guidance or you’re looking to refine your approach, this guide breaks down the key aspects of the policy.

Auto-enrolment is a state-led pension scheme intended to ensure that employees, current and future, who are not already saving into a workplace pension have access to a retirement savings vehicle.

A key call-out is that auto-enrolment is designed to supplement, not replace, the State pension.

A new statutory body, the National Automatic Enrolment Retirement Savings Authority (NAERSA), will be managing auto-enrolment, with oversight from the Pensions Authority.

“It’s worth noting that Ireland was the last OECD country without a retirement auto-enrolment system, so we were a bit behind our counterparts,” highlights Niall.

Auto-enrolment applies if all three criteria are met across all employees’ active employments.

Earnings

>€20,000 per year across one or more employments.

Age

Aged between 23-60.

Pension

No existing pension scheme (occupational, PRSA, RAC, PEPP, AVC, ASC).

Includes (in scope)

Excludes (not in scope)

Note: employees outside these criteria may opt in under the following  rules:

However, self-employed individuals cannot currently opt in to My Future Fund.

Contributions can be paused for a minimum of one year and a maximum of two years.

During the suspension, both employer and state contributions will also pause.

No refunds are available when pausing contributions.

Note: employee eligibility for suspension is only available after six months of participation.

The mandatory participation window before being able to opt out is six months, and the opt-out window will open in months seven and eight.

If an employee opts out, their contributions are refunded, but employer and state contributions stay in the pot.

After any rate changes (year four, seven and ten), a new six-month mandatory participation period starts, followed by another opt-out window during months seven and eight.

Employees who opt out or suspend contributions, and still meet the eligibility criteria, will be re-enrolled after two years.

A new six-month participation window starts again, followed by the option to opt out or suspend in months seven and eight.

NAERSA is responsible for tracking these timelines and informing the employer and payroll department via the AEPN.

Niall adds: “Contributions will be phased in over a 10-year period and are capped at €80,000 earnings across all employment.

“The contributions will be fixed at the prevailing rates outlined in this table.

“Employers will match the employee contributions with the State providing a top-up instead of tax relief.”

Minimum example: €20,000 annual salary

Maximum example: €80,000 annual salary

Note: the above examples are based on a single employment to provide a visual for budgeting/cash flow purposes.

Example one: two employments, no pension in either

Total contribution (years 1-3): €1,155

Example two: two employments, pension in one

Total contribution (years 1-3): €525

*Combined earnings are always taken into consideration for the income threshold.

Niall explained the similarities of My Future Fund in relation to PRSA, saying: “MFF is similar to PRSA, with the exception of the state top-up instead of tax relief for the employee.

“State top-up and any investment growth will be tax-free for the employee during the scheme lifecycle.

“The tax-free lump sum on drawdowns is up to 25% of the fund value.

“The balance is subject to income tax in the same manner as PRSA, but Revenue will apply the trivial pensions treatment where appropriate.”

The pot follows the employee

Niall comments: “These pension funds are owned and controlled by the employees, so as they move from one job to the next, it’ll follow them.”

Investment

Niall comments: “”Employees will have control over the investments their funds are allocated to.

“NAERSA will collect contributions from employees, employers and the state, placing them into a temporary NAERSA pot.

“Through fund managers, these contributions will be invested across various options, initially low-risk, with improved options introduced over time.

Once an investment option is chosen, the funds will be transferred to the employee’s pension pot for investment.”

Drawdown

Niall comments: “NAERSA will also handle the drawdowns. The retirement age currently matches that of the state, so you can’t drawdown early. The only two instances where drawdown can happen before 66 are serious-illness retirement or death.”

NAERSA is trying to handle as much of the administration as possible to lighten the burden for employers, looking after the following:

Using Revenue data (collected via payroll) together with their rolling 13-week lookback period.

Once eligible, NAERSA will inform employers through AEPN received via payroll to start contributions.

NAERSA is the authority that will administer the scheme in the best interest of the employees.

This will cover the contracts with investment managers, resolution process for non-compliance/complaints, fines and penalties.  

NAERSA will manage all aspects of the employer and employee portals, together with its website.

It’ll also provide information to both, along with certain assets/collateral.

Returns, collections and refunds will also be managed in this portal.

“Here’s a flavour of what it will look like for those managing payroll in-house.

“Employers will face minimal admin tasks.

“NAERSA will determine eligible employees based on the previous payroll data submitted to Revenue (PSR) using a rolling 13-week lookback period.

“Payroll software will then automatically calculate the auto-enrolment contributions due and report these to NAERSA.

“Something to note from a payroll perspective, relating to compliance, is the contribution schedule that needs to be submitted and reported back to NAERSA before payday.

“NAERSA has a strict cut-off time of 18:30 on payday – anything that happens after that will be flagged for non-compliance.

“There may be some leniency to begin with, but as it progresses, this will ramp up, so you need your processes in place,” says Niall.

Direct debit (preferred method)  

Debit/credit card (manual)

January 2026

​​☐​   First payroll of 2026 

​​☐​   Communications 

​​☐​   Monitoring 

Q2 2026 (April–June) 

​​☐​   Audit contributions: check payroll reports vs NAERSA submissions 
​☐​   Spot-check employee communications and opt-in/out processes 
​☐​   Review HR processes for new starters and ensure eligible hires are enrolled automatically 
​☐​   Hold employee info sessions to explain pension growth, opt-out rights and employer top-ups 

Q3 2026 (July–Sep) 

​​☐​   Monitor first wave of opt-outs (eligible from July 2026) 
​☐​   Ensure refund processes are accurate: employee contributions refunded while employer/state remains in fund 
​☐​   Communicate clearly to employees choosing to stay in vs opting out 
​☐​   Adjust budgets for actual participation levels 

Q4 2026 (Oct–Dec) 

​​☐​   Prepare for year-end review with HR/payroll/auditors 
​☐​   Confirm compliance with contribution caps (€80k earnings) 
​☐​   Review lessons learned and employee feedback 
​☐​   Plan for future rate increases: in the next phase, contributions will grow to 3%

There are a number of potential pitfalls that employers should monitor: 

Auto-enrolment presents a progressive approach to pension provision and is aimed at ensuring greater financial security for employees.  

For those who require additional assistance with adapting to auto-enrolment, Paycheck Plus is here to help. 

Paycheck Plus is an award-winning Irish payroll provider with deep expertise in Irish payroll and pension compliance.  

Our experienced, knowledgeable and ISO-accredited payroll team delivers payroll outsourcing services to UK, Irish and international organisations of all sizes. 

If you would like to ensure payroll accuracy and compliance with auto-enrolment, call our payroll company on +353 41 414 1481 or request a callback today. 

Note: this guide is an educational asset and does not constitute legal advice. Please note that the criteria are subject to change, and every effort has been made to ensure accuracy at the time of writing.