Upcoming PRSI Rate Changes in Ireland: What Employers Need to Know
From October 1st, 2025, the Irish government will implement changes to the Pay Related Social Insurance (PRSI) contribution rates. These adjustments are part of a broader effort to strengthen the country’s social insurance fund and ensure long-term sustainability of its social protection policies.
While the updates are relatively minor, they will have a direct impact on payroll costs for both employers and employees. If your company employs people in Ireland, it’s important to be aware of these changes and plan accordingly.
New PRSI Contribution Rates
Here’s a breakdown of the upcoming changes:
- Employee PRSI contribution will increase from 4.1% to 4.2%.
- Employer PRSI contributions will be adjusted as follows:
- From 11.15% to 11.25% for employees earning over €496 per week.
- From 8.9% to 9% for employees earning €496 or less per week.
- Employees earning €352 or less per week will continue to be exempt from PRSI contributions.
Although these are small percentage changes, they will slightly raise the total payroll costs and should be factored into your Q4 2025 budgeting and forecasting.
Looking Ahead: Pension Auto-Enrolment Postponed
In addition to the PRSI update, it’s worth noting that Ireland’s Pension Auto-Enrolment Scheme, which was initially expected to roll out earlier, has now been postponed to January 2026. Once active, this scheme will require mandatory employer contributions to employee pensions—another important cost to consider in your future workforce planning.
How Parakar Supports You
If you work with Parakar to employ talent in Ireland, you don’t need to take any action. Our local payroll experts will ensure that all changes are implemented seamlessly in your monthly payroll, in full compliance with the updated regulations.
We’re committed to staying ahead of all legislative updates, so you don’t have to. Should you wish to discuss the impact of these changes on your organisation, or if you’d like support with your financial planning for 2025 and beyond, our team is here to help!
