Auto-enrolment is a new retirement savings scheme for employees that will be introduced on 1 January 2026. It will apply to those who do not already have a workplace pension scheme or an additional pension arrangement.
How Will It Work?
The National Automatic Enrolment Retirement Savings Authority (NAERSA) will administer the scheme, minimising administrative work for employers. NAERSA will collect all contributions, invest funds and allocate returns. Employees will have a single savings pot that follows them between jobs. NAERSA will operate online portals for both employees and employers, supporting contributions, opt-ins/opt-outs and portal management. The scheme pay outs will begin at the State pension age (currently 66).
Who Will Be Auto-enrolled?
Anyone aged 23–60, who earns €20,000 or more per annum and has no current supplementary pension coverage will be automatically enrolled.
Contribution Rates
Contribution rates will increase gradually over the scheme’s first 10 years. In year one, the employer and employee will each contribute 1.5% of gross pay. This contribution will grow to 3%, 4.5% and 6% in years four, seven, and 10 respectively. The State will top up employee contributions at a 1:3 ratio (i.e. €1 for every €3 by the employee). The total contribution from year 10 is 14% of gross earnings. If an employee opts out or suspends contributions, employer contributions are also suspended. Employers may not pressure employees to opt out and penalties will apply for non-compliance.
How Are Contributions Collected?
NAERSA will send an automatic enrolment payroll notification via payroll software, specifying required contributions. Employers will then pay NAERSA, ideally via direct debit, concurrent with employee pay. Manual options are available for employers without payroll software. All contributions must be reported to NAERSA as they are paid.
Employer Portal
Employers and agents can access the MyFutureFund (NAERSA) employer portal using their Revenue Online Services (ROS) credentials. The portal allows for the managing and monitoring of contributions and the setting up of payment arrangements.
Key Points for Employers to Note
Employers should be aware that auto-enrolment brings several important responsibilities. There is no requirement to set up or administer an internal pension scheme but contributions made are eligible for corporation tax deductions. At the same time, employers have a legal duty to provide eligible employees with access to auto-enrolment and may face penalties for preventing participation or failing to make the necessary contributions. They are also obliged to notify employees of their enrolment and ensure compliance with the scheme’s rules. Most importantly, auto-enrolment does not replace existing legal obligations relating to pensions or PRSAs for employees.
Visit gov.ie/AE to learn more.
