HR and Payroll Consultancy
Irish payroll, PRSI, and employment compliance — managed end to end
The legal framework
Employment in Ireland is governed primarily by:
Employment Equality Acts 1998-2015: Prohibits discrimination on nine grounds in employment. | Organisation of Working Time Act 1997: Caps working time at 48 hours per week averaged over a reference period; sets minimum rest periods and paid annual leave entitlements. | Unfair Dismissals Acts 1977–2015: Provides protection against unfair dismissal for employees with 12 months' continuous service. | Payment of Wages Act 1991: Governs how wages must be paid and sets out permitted deductions. | Redundancy Payments Acts 1967–2014: Provides statutory redundancy entitlements for qualifying employees. | Statutory Sick Pay (Sick Leave Act 2022): Entitlement is 7 days in 2026 at 70% of normal daily pay, capped at €110 per day. *Source: https://www.gov.ie/en/publication/06eb9-statutory-sick-pay/ | Employment Permits Act 2024: Governs the employment of non-EEA nationals (see Residence and Work Permits page). |
2026 PRSI rates (Pay Related Social Insurance)
PRSI is collected by Revenue through the payroll system and funds the Social Insurance Fund, which provides state pension, jobseeker's benefit, illness benefit, and other social welfare payments.
Two PRSI rate periods apply in 2026:
Period 1: 1 January 2026 – 30 September 2026
Subclass | Weekly earnings | Employee PRSI | Employer PRSI |
AO | Over €552 | 4.2% | 11.25% |
AX | €352.01 – €552 | 4.2% (less credit) | 9.0% |
AL | €352 or less | Nil | 9.0% |
Period 2: 1 October 2026 – 31 December 2026
Subclass | Weekly earnings | Employee PRSI | Employer PRSI |
AO | Over €552 | 4.35% | 11.40% |
AX | €352.01 – €552 | 4.35% (less credit) | 9.15% |
AL | €352 or less | Nil | 9.15% |
Threshold note: The €552 per week threshold was increased from €527 on 1 January 2026 to ensure employers of full-time minimum wage workers (€14.15/hr × 39 hours = €551.85/week) continue to pay the lower employer PRSI rate. Source: https://www.nkc.ie/news/new-prsi-rates-and-thresholds
PRSI credit: A tapered employee PRSI credit of up to €12 per week applies on earnings between €352.01 and €424 per week. Source: https://assets.gov.ie/static/documents/cb168977/PRSI_C20260116_Contribution_Rates_and_User_Guide_-SW_14-English_Version-January_2026.pdf-web.pdf (DSP 2026 PRSI Guide)
2026 income tax (PAYE) rates and bands
Status | Standard rate band (20%) | Higher rate (40%) |
Single / widowed | Up to €44,000 | Above €44,000 |
Married / civil partnership, one income | Up to €53,000 | Above €53,000 |
Married / civil partnership, two incomes | Up to €88,000 combined | Above respective bands |
Source: https://www.revenue.ie/en/jobs-and-pensions/calculating-your-income-tax/tax-rate-band.aspx
Universal Social Charge (USC) — 2026 rates
USC is charged on gross income before pension contributions. Exemption applies where total income is €13,000 or less.
Income band | USC rate (2026) |
Up to €12,012 | 0.5% |
€12,013 – €28,700 | 2.0% |
€28,701 – €70,044 | 4.5% |
Over €70,044 | 8.0% |
The €28,700 upper limit of the 2% band increased by €1,318 from 2025 to ensure that full-time minimum wage workers remain outside the top USC rates. Source: https://kpmg.com/ie/en/insights/tax/budget-2026/tables.html; https://www.rte.ie/news/budget-2026/2025/1007/1537071-budget-2026-tax/
Pension auto-enrolment — My Future Fund (from 1 January 2026)
Ireland launched its mandatory pension auto-enrolment scheme, My Future Fund, on 1 January 2026. This is a new employer obligation affecting most businesses.
Who is enrolled automatically: Employees who meet ALL of the following criteria:
Aged 23–60
Earning €20,000 or more per year
Not already contributing to a qualifying workplace pension scheme through payroll
Contribution rates — Years 1–3 (2026–2028):
Contributor | Rate of gross salary |
Employee | 1.5% |
Employer | 1.5% |
State top-up | 0.5% (€1 for every €3 the employee contributes) |
Total into fund | 3.5% |
Contributions are capped at €80,000 gross annual salary. Rates increase every three years: to 3% each in years 4–6, to 4.5% each in years 7–9, and to 6% each from year 10. Source: https://leglobal.law/2025/11/25/ireland-impending-introduction-of-mandatory-pension-auto-enrolment-in-ireland/; https://www.mhc.ie/latest/insights/minimum-pension-contribution-rates-to-be-introduced
Employer obligation: Employers must register on the NAERSA portal, identify eligible employees, and process deductions and remittances through payroll. K&L Global manages this as part of the standard payroll service.
Statutory leave entitlements (Ireland, 2026)
Annual leave: Minimum of 4 working weeks (20 days for a 5-day week) per leave year for full-time employees. Part-time employees accrue 8% of hours worked, subject to the 4-week maximum. Source: https://www.citizensinformation.ie/en/employment/employment-rights-and-conditions/leave-and-holidays/annual-leave/
Public holidays: 10 public holidays per year in 2026. Source: https://www.citizensinformation.ie/en/employment/employment-rights-and-conditions/leave-and-holidays/public-holidays/
Maternity leave: 26 weeks' ordinary maternity leave + 16 weeks' additional unpaid maternity leave. Maternity Benefit paid by the Department of Social Protection subject to PRSI qualification. Source: https://www.citizensinformation.ie/en/employment/employment-rights-and-conditions/leave-and-holidays/maternity-leave/
Paternity leave: 2 weeks' paid paternity leave (Paternity Benefit from DSP, subject to PRSI qualification). Source: https://www.citizensinformation.ie/en/employment/employment-rights-and-conditions/leave-and-holidays/paternity-leave/
Parental leave: 26 weeks per parent per child (unpaid), before the child reaches age 12. Source: https://www.citizensinformation.ie/en/employment/employment-rights-and-conditions/leave-and-holidays/parental-leave/
Statutory sick pay (2026): 7 days at 70% of normal daily pay, capped at €110 per day per sick leave year. Source: https://www.gov.ie/en/publication/06eb9-statutory-sick-pay/
Statutory notice periods:
Continuous service | Minimum statutory notice |
13 weeks – 2 years | 1 week |
2 – 5 years | 2 weeks |
5 – 10 years | 4 weeks |
10 – 15 years | 6 weeks |
15+ years | 8 weeks |
Statutory redundancy payment: 2 weeks' gross pay per year of service + 1 bonus week, capped at a weekly earnings ceiling of €600 per week. Applies after 2 years' continuous service. Source: https://www.citizensinformation.ie/en/employment/employment-rights-and-conditions/losing-your-job/redundancy-payments/