Auto-Enrolment for Employers: Is Your Business Ready for 2026?
From 1 January 2026, Ireland’s new auto-enrolment pension scheme will begin. If you don’t currently offer a workplace pension, your business will be legally required to enrol eligible employees and contribute to their retirement savings.
We’ve created this blog, packed with downloadable resources, to help you understand what’s changing and explore your options.
Read on to learn more.
What Is Auto-Enrolment?
Auto-enrolment is a government pension scheme designed for employees who:
Are aged between 23 and 60
Earn €20,000 or more per year
Are not already enrolled in a workplace pension
These employees will be automatically enrolled, and contributions will be deducted through payroll. Employers will match these contributions, and the State will add a top-up.
How Much Will Employers and Employees Contribute?
Contributions will increase gradually between 2026 and 2036:
2026–2028:
Employer: 1.5%
Employee: 1.5%
State: 0.5%
2029–2031:
Employer: 3%
Employee: 3%
State: 1%
2032–2034:
Employer: 4.5%
Employee: 4.5%
State: 1.5%
2035 onwards:
Employer: 6%
Employee: 6%
State: 2%
These contribution rates apply to earnings up to €80,000 per year.
What Are the Drawbacks?
While auto-enrolment is a step forward, it’s not perfect. Key limitations include:
Less tax relief: State contributions are lower than the tax relief available through private pensions (e.g. 40% relief via PRSAs or occupational schemes).
Limited investment choice: Employees can only choose from four State-managed funds.
No voluntary top-ups: You can’t make additional contributions.
No flexibility: Employers have no say in the provider or structure.
Locked-in access: Funds can’t be accessed before retirement age (except in limited illness cases).
Should You Set Up Your Own Workplace Pension?
Auto-enrolment is the default—but many employers should consider setting up their own occupational pension scheme or group PRSA.
Benefits include:
Up to 40% tax relief for employees
Full control over provider, structure and investment options
More flexibility for contributions, employer matching, and employee choice
Better long-term value for your staff
At Financial Planning Matters, we specialise in helping Irish SMEs create tailored pension plans that work—for both employer and employee.
What Employers Should Do Now
Review any existing pension arrangements
Decide whether to opt into the State scheme or set up your own
Communicate clearly with eligible staff before January 2026
Update payroll and processes to manage contributions properly
Useful Resources
Read more about auto-enrolment for employers on our dedicated page HERE.
📄 View & Download our free 1 page checklist HERE.
Book Your Free Employer Pension Consultation
We’re here to help your business understand what’s changing - and how to make the most of it.
📧 Email advice@fpms.ie to arrange a no-obligation call with one of our financial planners.
Let’s talk about what’s right for your business—before January 2026 creeps up.
