Auto Enrolment: are you ready for January 2026?

Starting January 1st, 2026, Ireland will introduce the mandatory Auto-Enrolment (AE) retirement savings system, known as My Future Fund. If you employ staff aged 23–60 earning over €20,000 annually who are not already in a pension, you will be required to comply.

Image

What Is Auto Enrolment (AE)?

Auto Enrolment is a Government-backed pension savings scheme aimed at supplementing the State Pension. Key features include:

Automatic enrolment

Employees are signed up without needing to opt in

Contribution structure

For every €3 the employee contributes, you contribute €3, and the State adds €1

Gradually increasing contributions

Starts at 1.5% of gross pay. Increases to 6% over 10 years

Opt-out

Re-enrolment every 2 years for those who opt out, if still eligible

Opt-in

Employees outside the criteria can opt in voluntarily

You may be exempt

Already offer a qualifying pension? You may be exempt

Download our Auto Enrolment guide

Everything you need to know to prepare your business for Auto Enrolment in January 2026 – explained simply and clearly.

Is Auto Enrolment right for your business?

Before defaulting to AE, consider your business’s needs:

  • Do you already offer pensions?
    If so, you may not need AE, depending on the scheme’s structure and contribution levels.

  • Need more flexibility?
    AE is rigid. A PRSA or occupational pension may offer:

    • Salary sacrifice options

    • Investment choice

    • Tailored tax planning

  • High turnover staff?
    AE is ideal for high-churn roles.Stable teams might benefit more from a bespoke pension plan.

  • Want to retain key staff?
    Tailored pensions allow higher employer contributions, generous tax-free lump sums, and early retirement options.

Why consider a PRSA or occupational pension instead?

Up to 40% tax relief on employee contributions
Up to 40% tax relief on employee contributions
AVC's  permitted
AVC's permitted
Early retirement possible, from age 50
Early retirement possible, from age 50
Larger tax-free lump sums (up to 1.5x salary)
Larger tax-free lump sums (up to 1.5x salary)
Investment strategies based on employee risk profiles
Investment strategies based on employee risk profiles

What employers should do now

Review your current pension arrangements: Ensure they meet or exceed AE requirements.

Communicate with employees: Help your team understand what’s changing and why.

Plan for contribution increases: Employer contributions will rise steadily over a decade, budget accordingly.

Seek advice: Not sure if AE is right for your business? Our HR & Payroll team can help you evaluate your options.

Mary McDonagh

Talk to Mary McDonagh

Head of HR & Payroll Services1800 714 050marymcdonagh@ifac.ieLinkedin