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There will be a big change to employment law regarding Pensions coming in early 2025, in that the government are planning on introducing Auto-enrolment for all employees into a pension.

  • All employees with an income greater than €20,000 and aged between 23 and 60 will be auto-enrolled in a pension.

  • Contributions will start at 1.5% Employee, 1.5% Employer and 0.5% Government and will increase to 6% Employee, 6% Employer and 2% Government as a % of monthly salary, on a phased basis every three months.

  • These pension contributions will *not* be eligible for income tax, USC or PRSI relief as source. Contributions are deducted from net pay.

  • The State will instead contribute €3 for every €4 paid by the employee, equivalent to 25% tax relief

  • Average Pension age in Ireland is 59 but you will not be able to access your AE pension until the state pension age of 66.

  • Participants will be allowed to opt-out or suspend their contributions after a mandatory six-month participation period. They will be brought back into the system again after two years unless they have an alternative pension arrangement.

Note that this is a mandatory cost to the employer, and mandatory for the employee also. It is the employer’s responsibility to ensure compliance via payroll.

To avoid being auto-enrolled in the Revenue pension scheme, we are advising all of our clients to instead set up a Group/Executive pensions schemes before Auto-enrolment is introduced in 2024. If a Company has an existing occupation pension scheme set up, they will be exempt from the Revenue one.

There are a number of advantages to setting up your own company pension scheme compared to the mandatory Revenue scheme as follows:

Revenue Autoenrolment Your own Company Pension
Contribution Levels Employer & Employee contribuitions are fixed and cannot be changed by you. You can decide your own Employee and Employer contributions, subject to revenue max and min limits.
Max funding Contribution amount is fixed. Currently no facility for AVC (Additional Voluntary Contribution) top-ups More generous funding limits for your pension. Employees habe the opportunity to do AVC`s (many Employees look for this)
Accessing Retirement Savings Only at Retirement Age. E.g. if an employee wished to retire at 62, they would not have access to their pension. Benefits can be accessed from Age 50+, subject to revenue rules
Investment choises No choice available; controlled by Central Processing Authority Variety of fund choices available to suit employees’ risk appetite
Investment Advice None available Professional, personal advice from a Qualified Financial Advisor
Administration Employer must deal directly with Revenue for any queries Professional and personal customer service from an experienced financial advisor; happy to assist with any queries.
Transfer in or Out Not Available Available e.g. Buy Out Bond
Tax Relief Effective 25% Full Tax relief at marginal rate of rax

Take control of your retirement today by setting up a private pension plan with us.
Don’t wait until 2025 for auto-enrolment.
Our tailored pension solutions offer greater flexibility, higher contribution limits, and personalized investment choices that can better secure your financial future.
Contact us now to start planning for a comfortable and worry-free retirement or book your appointment online now.

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