Two payroll changes took effect on 1 January 2026. MyFutureFund, the State's automatic enrolment retirement savings scheme, began collecting contributions, and the national minimum wage rose to €14.15 an hour under S.I. No. 472 of 2025. Budget 2027, announced on 6 October 2026, confirmed a further minimum wage rise to €14.94 from 1 January 2027.

What happened: auto-enrolment and the minimum wage

Auto-enrolment: MyFutureFund

The National Automatic Enrolment Retirement Savings Authority (NAERSA) was established on 14 October 2025 to run MyFutureFund. Contribution collection began on 1 January 2026, after being moved from September 2025.

According to the Department of Social Protection, employees are automatically enrolled if they are aged 23 to 60, earn €20,000 or more a year across all employments, and are not already in a pension scheme through payroll. Contributions are a percentage of gross pay:

  • Years 1 to 3: employee 1.5%, employer 1.5%, State 0.5%
  • Years 4 to 6: employee 3%, employer 3%, State 1%
  • Years 7 to 9: employee 4.5%, employer 4.5%, State 1.5%
  • Year 10 onwards: employee 6%, employer 6%, State 2%

Contributions are not charged on gross pay above €80,000. MyFutureFund's employer handbook says payments are due by 18:30 on each employee's pay date.

Minimum wage

The national minimum wage for workers aged 20 and over has been €14.15 an hour since 1 January 2026. Citizens Information reports that Budget 2027 will raise it by 79 cent to €14.94 an hour from 1 January 2027. It takes effect when the Minister signs the order. Lower rates apply to younger workers: since 1 January 2026, €12.74 an hour at age 19, €11.32 at age 18 and €9.91 under 18, set at 90%, 80% and 70% of the full rate. The employer PRSI threshold will rise from €552 to €600 a week for 2027, which the Government said is meant to ease the PRSI impact of the higher minimum wage.

What it means for Irish limited companies

Both changes raise the cost of employing people, and both are paid out of cash every pay day. Neither can be deferred. Unlike a supplier invoice, there is no 30-day credit period on wages or pension contributions.

Illustrative example: a full-time employee working 39 hours a week on €14.15 earns about €28,700 a year. If they are 23 or over and not in a payroll pension, they are auto-enrolled. The employer's 1.5% contribution is about €430 a year. From 1 January 2027, the minimum wage rise adds about €31 a week, or about €1,600 a year, to the same employee's pay before employer PRSI. For a company with ten such staff, that is roughly €16,000 more a year. These are round figures for illustration only.

The Department of Social Protection also sets out what employers must do. You must match each enrolled employee's contribution, make sure your payroll software can calculate and pay contributions, pay them at the same time as wages, and tell employees when they are first enrolled. You must stop employer contributions when an employee suspends theirs. Withheld or underpaid contributions attract interest, and the Workplace Relations Commission deals with cases where employees are hindered or penalised.

Contribution rates also step up. Employers pay 3% from year four of the scheme, so the cost of auto-enrolment will double in 2029 under the current schedule.

What to do now

  1. Check that your payroll software is calculating MyFutureFund contributions correctly and that your MyFutureFund employer portal profile and payment method are set up.
  2. Make sure contributions leave your account on each pay date. Late payment can lead to interest, fines and penalties.
  3. Do not encourage staff to opt out. Employers who prevent enrolment or pressure staff to leave can be prosecuted.
  4. Update your 2027 budget for the €14.94 minimum wage and the new €600 PRSI threshold.
  5. Review pricing for 2027. Sectors with many minimum wage staff, such as hospitality and retail, feel the change most.
  6. Build a cash flow forecast that shows payroll weeks alongside your VAT and preliminary taxAn advance payment of corporation tax made before the end of a company's accounting period. dates.

If payroll cost rises leave your company short around tax deadlines, read our guide to phased payment arrangements and tax funding. Our working capital calculator can help you test your numbers, and our guide to overdraft alternatives compares short-term options. Payroll finance is a specialist product some employers use. For hospitality companies, our post on the 9% VAT rate covers the other side of the ledger.

How Welcome Finance can help

Our lender panel can consider working capital loans and short-term business loans for companies that need to bridge a temporary gap. A loan adds a repayment, so it suits a short-term timing problem better than a permanent rise in costs. No outcome is guaranteed. Welcome Finance is a commercial finance broker, not a lender, and is not regulated by the Central Bank of IrelandIreland's financial regulator and part of the Eurosystem.. We work only with companies registered in Ireland (LTD, DACA type of Irish private company under Part 16 of the Companies Act 2014 that keeps an objects clause in its constitution, limiting what it can do, and uses the suffix DAC., PLCA company type under Part 17 of the Companies Act 2014., ULCA company under Part 19 of the Companies Act 2014 whose members have unlimited liability for its debts.) and are paid commission by lenders. We do not charge your company a fee and never ask for payment upfront.