In our latest blog we explain Ireland's new retirement savings scheme.

So, what is auto Enrolment and what does it mean for your business ?

• Government backed pensions scheme: Expected to launch in Q1 2026, Auto Enrolment (AE) aims to increase pension coverage for employees without workplace pensions.
• Mandatory employer contributions: Employers will have no choice and must match employee contributions. With additional top–ups from the government.
• Automatic but with an opt out: Eligible employees will be enrolled automatically but can opt out after 6 months.

Who is Included and what are the eligibility Criteria for AE?

• Age & Income requirements: Employees aged 23+ earning more than €20,000 annually (across all sources /jobs) will be automatically enrolled.
• Exclusions: Self employed individuals and those already in a workplace pension scheme will not be included
• Opt-Out Rules: Employees can opt-out after six months. They will be re-enrolled every two years if they still meet the eligibility criteria.

AE vs .Existing Pension Schemes

• Contribution Flexibility: AE has fixed rates, While existing pensions allow additional voluntary contributions (AVCs)
• Retirement Age: AE is tied to the State Pension Age ( currently 66, raising to 68), while workplace pensions offer more flexibility ( 50 -70).
• Tax Benefits & Fund: AE offers a 33% top – up on after-tax contributions, While workplace pensions provide 20-40% tax relief and more investment options.

Employer Concerns & How to Prepare

• The key challenges and steps for compliance Increased Payroll Costs: 42 % of employers expect to adjust future pay rises to offset the AE expenses.
• Administration Burden: Businesses must manage payroll deductions, enrolments, and compliance reporting.
• Employee Education: Clear communication is crucial to help employees understand AE and its impact on take-home pay.

Final Thoughts & Next Steps

• Review existing Pension Scheme: Ensure your current pension plan meets compliance and avoid unnecessary enrolment.
• Budget for Employer Contributions: Plan ahead for the increasing payroll costs starting at 1.5% and increasing to 6% by 2034.
• Educate& Communicate: Engage with employees to explain AE's impact on take home pay and long-term benefits.