How to Prepare for Auto Enrolment Ireland: Employer Guide

Ireland’s Auto Enrolment (AE) pension scheme is set to launch on September 30, 2025. 

It aims to increase retirement savings participation among the 750,000 workers, particularly private sector employees, who lack pension coverage beyond the State Pension.  

Employers should start preparing now to meet compliance requirements, streamline processes, and avoid penalties.

Wondering how to prepare for Auto Enrolment in Ireland?

We’ve got you covered with the basics and key steps to ensure a smooth transition for your business.

Preparing for Auto Enrolment Ireland: What Employers Need to Know

The Automatic Enrolment Retirement Savings System Act was passed in 2024, paving the way for the introduction of Auto Enrolment pension in Ireland in 2025. 

For the first time, Irish employers will be legally obliged to contribute to a pension (the Auto Enrolment scheme) on behalf of their employees. 

Similarly, employees must contribute for set periods before they can opt out.

Here are some key details employers must be aware of to prepare for the Auto Enrolment pension scheme: 

1. Who Needs to be Enrolled? 

• As per the scheme’s eligibility criteria, employees aged 23 to 60 earning over €20,000 annually will be automatically enrolled.

• Employees who don’t meet the eligibility criteria may still have the option to ‘opt-in’ voluntarily.

• Eligibility is determined by the National Automatic Enrolment Retirement Savings Authority (NAERSA) — the government body responsible for overseeing Ireland’s Auto Enrolment scheme. They will notify employers which employees must be enrolled. 

2. What Are the Employer and Employee Contributions?

• Pension contributions for employers and employees start at 1.5% of their gross earnings and increase incrementally over ten years to 6% each.

• The State contributions provide an additional top-up to the employee’s pension fund, starting at 0.5% and reaching 2% by year ten.

3. Can Employees Opt Out of Auto Enrolment? 

• Employees can opt-out after the first six months but will be automatically re-enrolled every two years unless they opt out again.

4. Who Will Oversee the Auto Enrolment Scheme and How? 

• The new scheme will be overseen by the National Automatic Enrolment Retirement Savings Authority (NAERSA).

• NAERSA will manage compliance, oversee pension contributions, and ensure transparency.

• Employer and employee deductions will be sent to NAERSA, where the top-up will be added and sent to the pension providers. 

• Employers and HR will need to link in with NAERSA to ensure funds flow to them in the approved manner.

5. What Is the Impact on Existing Occupational Pension Schemes?

• Employers offering qualifying occupational pension schemes (aka company pension schemes) that meet basic contribution requirements are exempt from Auto Enrolment. These requirements include employer contributions (even if minimal) and coverage of eligible employees.

• Non-qualifying company pension schemes will need to be adjusted or replaced to meet AE compliance requirements.

Auto Enrolment Checklist for Employers in Ireland

To comply with the requirements of the new scheme, employers should check off the following 10 HR-related tasks:

1. Assess the eligibility of your current workforce.

2. Ensure your payroll system can calculate and process contributions.

3. Communicate with your employees about the Auto Enrolment scheme and its benefits.

4. Establish a process for managing opt-outs and re-enrolments.

5. Update employee contracts to reflect Auto Enrolment participation.

6. Budget for phased employer contributions.

7. Choose an appropriate pension scheme provider.

8. Train your HR and payroll teams to handle Auto Enrolment requirements.

9. Set up systems for tracking and reporting contributions.

10. Liaise with NAERSA for ongoing compliance.

In addition to these, employers have defined responsibilities to ensure Auto Enrolment compliance.

Let’s check them out.

What Are the Employer’s Responsibilities for Auto Enrolment in Ireland?

In Ireland's Auto Enrolment scheme, employers are responsible for:

• Processing contributions through payroll systems.

• Informing employees about their enrolment and rights, including opt-out and re-enrolment options.

• Matching contributions for eligible employees.

How Much Can Auto Enrolment Cost Irish Employers?

The Auto Enrolment scheme comes with various costs which Irish employers may need to consider, including: 

• Implementation costs: Upgrading payroll systems and training HR teams to manage AE requirements.

• Employer contributions: Initial contributions start at 1.5% of gross pay, increasing to 6% over ten years.

• Phased contribution increases: Employers must prepare for the financial impact of gradually higher contribution rates.

Why Occupational Pensions May Be a Better Option

• Flexible contribution rates: Employers can set contribution levels based on business capacity.

• Cost management: Avoid mandatory contribution increases tied to Auto Enrolment.

• Administrative control: Occupational pensions offer more control over investment options and employee benefits.

• Tax relief: Employer pension contributions can be offset against corporation tax, meaning the employer's contributions are reduced by 12.5%. Unlike Auto Enrolment, employees contributing to an occupational pension get tax relief of either 20% or 40%, depending on their marginal tax rate.

*Assumes a single individual taxpayer with no additional tax credits or band allocations. Figures are for illustrative purposes to highlight the differences between top-up and tax relief.

Set Up Your Occupational Pension Scheme in Minutes with Kota

Kota provides easy and efficient solutions to set up your occupational pension scheme.

Our platform is designed to simplify the process, offering tailored options for contributions, tax relief, and investments.

With Kota, employers have the flexibility to create pension arrangements that work for their teams.

6 Auto Enrolment Ireland FAQs 

Let’s answer some common questions employers may have about the Auto Enrolment pension:

1. Who Is Exempt from the Auto Enrolment Scheme in Ireland? 

Employers who already offer a qualifying occupational pension arrangement and contribute on behalf of their employees are exempt from Auto Enrolment.

2. Do Small Businesses Need to Comply with Auto Enrolment? 

Yes, all Irish employers must comply, regardless of business size.

3. Are Employees Contributing to Personal Pension Plans Eligible for Auto Enrolment?

Yes, personal pension plan contributions do not exempt employees from AE unless facilitated through payroll.

4. Do Employers Still Need to Provide Employees Access to a PRSA?

Ireland’s Automatic Enrolment Retirement Savings System Act 2024 doesn’t affect existing pension schemes or legislation. 

This means you still have an obligation to provide your employees with access to a Personal Retirement Savings Account (PRSA) if they wish to avail of it.

5. How Are Auto Enrolment Contributions Calculated? 

Contributions are based on gross earnings, starting at 1.5% and increasing over time.

6. How Will Employer and Employee Contributions Be Collected and Paid?

Contributions will be processed via payroll and transferred to the designated Auto Enrolment provider.

Still have more questions?

Check out our detailed Auto Enrolment Guide for all the answers.

Empower Your Employees: Get Auto Enrolment Ready

The introduction of Auto Enrolment in 2025 has prompted companies to reconsider their approach to employee benefits and pension savings — whether through the Auto Enrolment scheme or existing occupational pension schemes. 

While this retirement savings scheme may increase workloads and responsibilities for business owners, HR teams, and finance departments, its long-term benefits are undeniable.

By starting preparations early, employers can ensure a smooth transition, stay ahead of compliance, and give themselves the flexibility to budget and adapt. 

Most importantly, you’re investing in your most valuable asset—your people—by helping them build a secure and comfortable retirement.