---
title: "Ireland Tax and Payroll 2026 | PRSI, PAYE, Income Tax"
description: "Ireland payroll 2026: 11.25% employer PRSI, 4.2% employee PRSI, two income tax bands, PAYE Modernisation filing by the 14th each month."
canonical: https://www.teamed.global/country-hiring-guides/ireland/tax-and-payroll
---

Ireland · Tax & payroll child

Served by Teamed vetted partner-entity network in Ireland

# How does *Irish payroll tax* work in 2026?

Ireland taxes income at 20% on the first €44,000 and 40% above that. Employer PRSI is 11.25% from January, rising to 11.40% from October 2026. A new auto-enrolment pension launched in September 2025. Three separate charges stack on every Irish payslip, and the rates are changing mid-year.

Last reviewed 12 June 2026 · Ireland guide

![Dublin city view along the River Liffey with Georgian architecture and a clear blue sky.](/images/country-guides/ireland-tax-payroll.webp)

Illustration · Dublin, Ireland

Answer.cite this

Employer PRSI in Ireland is 11.25% on Class A earnings. This rate applies from January to September 2026. It rises to 11.40% from 1 October 2026.

The employee pays PRSI at 4.2%. The employee also pays income tax (PAYE) and the Universal Social Charge (USC). All three are separate deductions, calculated differently.

Income tax runs at 20% on the first €44,000 of taxable income for a single person. Everything above that is taxed at 40%.

Payroll is filed in real time under PAYE Modernisation. Employers must submit each payroll run to Revenue before payday. The monthly liability is due by the 14th of the following month.

![A green ledger book and a calculator on a wooden desk beside a coffee cup.](/images/country-guides/ireland-tax-payroll-polaroid-1.webp)

Three charges, one payslip

## What does an employer pay in Irish PRSI?

Employer PRSI Class A is 11.25% on most employee earnings. This rate applies from 1 January to 30 September 2026.

From 1 October 2026, the employer rate rises to 11.40%. There is no earnings ceiling on employer PRSI and no allowance to offset the liability.

| PRSI class | Who it applies to | Employer rate (Jan to Sep 2026) | Employer rate (Oct 2026) |
| --- | --- | --- | --- |
| Class A (main rate) | Most private sector employees | 11.25% | 11.40% |
| Class A (lower band) | Earnings EUR 352 to EUR 496/week | 8.80% | 8.80% |
| Class J | Employees earning below EUR 352/week | 0.50% | 0.50% |

The main Class A employer rate of 11.25% applies to earnings above EUR 496 per week. Below that threshold a lower band applies. Most salaried professional hires earn well above the weekly threshold and face the full rate from the first eligible euro.

There is no employer PRSI allowance comparable to the UK Employment Allowance. The full 11.25% applies to all earnings above the threshold, regardless of how small the company is.

### October 2026 rate change

The PRSI rate schedule published by the Department of Social Protection shows two rates for 2026. The rate of 11.25% applies from 1 January to 30 September 2026. From 1 October 2026 the employer rate rises to 11.40%. This change is legislated and not contingent on a budget announcement. Payroll systems must apply the new rate from the first run in October. Teamed applies the correct rate for each period automatically.

Source: [Department of Social Protection, PRSI Class A Rates 2026](https://www.gov.ie/en/department-of-social-protection/publications/prsi-class-a-rates/).

## What does an employee pay in Irish PRSI?

Employee PRSI Class A is 4.2% on earnings above the weekly threshold. There is no upper earnings limit.

From 1 October 2026, the employee rate also rises to 4.35%. The employee pays this on top of income tax and the Universal Social Charge.

| Earnings band | Employee PRSI rate (Jan to Sep 2026) | Employee PRSI rate (Oct 2026) |
| --- | --- | --- |
| Up to EUR 352/week | 0% | 0% |
| Above EUR 352/week | 4.2% | 4.35% |

Unlike UK NIC, Irish employee PRSI has no upper earnings limit. The 4.2% rate applies to all earnings above EUR 352 per week, including high salaries. High earners pay PRSI on every euro above the weekly threshold.

### Universal Social Charge

The USC is a separate payroll deduction charged by Revenue on top of PRSI and income tax. USC rates in 2026 are 0.5% on the first EUR 12,012 of income, 2% from EUR 12,013 to EUR 25,760, 3% from EUR 25,761 to EUR 70,044, and 8% above that. USC is not held in the compliance cache and is presented here in prose only. USC rates are set each year in the Budget. Teamed applies the current USC bands via each employee's Revenue payroll notification from day one.

The combined deduction on a typical Irish payslip is employee PRSI at 4.2%, plus USC at the applicable bands, plus income tax at the standard or higher rate. All three run in parallel on the same gross earnings figure.

## Ireland income tax bands for 2026

Ireland has two income tax bands for a single person. The standard rate is 20% on income up to €44,000 a year.

Everything above €44,000 is taxed at 40%. There is no Irish income tax rate above 40%.

| Income band (single person, 2026) | Income tax rate |
| --- | --- |
| Up to €44,000 | 20% (standard rate) |
| Above €44,000 | 40% (higher rate, uncapped) |

Revenue Commissioners · Tax Rates, Bands and Reliefs 2026

Revenue confirms the 2026 standard rate band for a single person is **€44,000 at 20%**. The balance above that is taxed at **40%**. There is no income tax rate above 40% in Ireland.

Source: [Revenue Commissioners, Tax Rates, Bands and Reliefs 2026](https://www.revenue.ie/en/personal-tax-credits-reliefs-and-exemptions/tax-relief-charts/index.aspx)

### Tax credits reduce the effective rate

Ireland does not use a tax-free personal allowance in the way the UK does. Instead, every taxpayer receives non-refundable tax credits that reduce the income tax bill. The Personal Tax Credit and Employee Tax Credit give a combined credit of EUR 3,950 in 2026 for a single employed person. This means that, in practice, no net income tax is due until earnings exceed roughly EUR 19,750. Tax credits are not statutory numbers in the current cache and are stated here in prose only.

### Married couples and civil partners

Married couples and civil partners can transfer unused standard rate band capacity to each other. The combined standard rate band increases to EUR 88,000 for a two-earner couple, or EUR 53,550 where one spouse earns all the income. Band assignments are applied via each employee's revenue payroll notification. Teamed's onboarding captures marital status and applies the correct band split from the first pay run.

## How does PAYE Modernisation work in Ireland?

PAYE Modernisation replaced the old annual return system in January 2019. Employers now report pay and deductions to Revenue for every payroll run, before or on each payday.

Revenue generates a monthly statement by the 5th of each month. The employer accepts or corrects it by the 14th. If the employer does not act, Revenue deems the statement accepted on that date.

The submissions an employer must file under PAYE Modernisation:

- **Payroll Submission Request (PSR)**, on or before each payday, for every employee paid that period
- **Monthly statutory return**, accepted or corrected by the 14th of the following month
- **Leaving notification**, filed when an employee's employment ends

There is no separate annual return under PAYE Modernisation. Revenue assembles the annual record from the monthly submissions. The employee's year-end income summary is generated directly by Revenue; the employer does not issue a separate document.

### Payroll frequency and remittance

Most salaried employees in Ireland are paid monthly, giving 12 submissions per year. Weekly and fortnightly cycles are also supported. The combined PAYE, USC, and PRSI liability is remitted electronically by the 23rd of the month following the payroll run. Late payment attracts an 8% annual interest charge, calculated daily. Teamed runs Irish payroll on a monthly cycle by default and files the submission before each payday.

1. Collect pay data Gather hours worked, salary, bonuses, and any taxable benefits for the pay period before the run closes.
2. Calculate gross pay Total all earnings for the period, including regular salary, variable pay, and any taxable benefit-in-kind values.
3. Deduct employee PRSI, USC, and income tax Apply the employee PRSI rate, the correct USC bands, and the income tax rate from the Revenue payroll notification to calculate net take-home.
4. Calculate employer PRSI and pension Calculate employer PRSI at 11.25% on earnings above the weekly threshold, plus the auto-enrolment employer contribution at 1.5% of gross pay for qualifying employees.
5. Submit the payroll notification to Revenue File the Payroll Submission Request on or before each payday. Revenue generates a monthly statement by the 5th; accept it by the 14th to complete the monthly return.

## Pension contributions in the Irish payroll stack

Ireland launched a new auto-enrolment pension scheme on 30 September 2025. In years 1 to 3, the employer contributes 1.5% of gross pay and the employee contributes 1.5%.

The state adds a further 0.5% in years 1 to 3. Contribution rates step up every three years, reaching 6% each for employer and employee by year 10.

| Phase | Years | Employer | Employee | State | Total |
| --- | --- | --- | --- | --- | --- |
| Phase 1 (current) | 2025 to 2028 | 1.5% | 1.5% | 0.5% | 3.5% |
| Phase 2 | 2028 to 2031 | 3% | 3% | 1% | 7% |
| Phase 3 | 2031 to 2034 | 4.5% | 4.5% | 1.5% | 10.5% |
| Phase 4 | 2034 onwards | 6% | 6% | 2% | 14% |

The phase 2 to 4 rates come from Section 61 of the Automatic Enrolment Retirement Savings System Act 2024. They are not in the compliance cache as independently verified figures and are stated here in prose, consistent with the published statute text.

### Who is covered

Auto-enrolment covers employees aged 23 to 60 who earn more than EUR 20,000 a year and are not already in a qualifying occupational pension scheme. Employees outside that window can opt in voluntarily. Employers cannot opt out of the scheme for qualifying employees.

### National minimum wage

The national minimum wage for an adult employee aged 20 or over is €14.15/hour from 1 January 2026. Payroll must verify that every employee's effective hourly rate meets or exceeds this floor before any deductions are applied. Teamed's onboarding captures the correct hourly rate classification and flags any contract below the minimum before the first payroll run.

## How does Teamed handle Irish payroll for you?

Teamed becomes your legal [employer of record](/lp/employer-of-record) in Ireland for [**from $599 per employee per month**](/pricing), with **zero FX mark-up** in any currency.

PRSI, PAYE income tax, USC, auto-enrolment pension, and PAYE Modernisation all run on **one platform**.

**Real HR and legal experts** handle your Irish hires, from the first offer letter through every PAYE Modernisation submission and monthly Revenue return. **An actual person**, not a chatbot or a pooled queue. There is **no setup fee** and **no exit fee**. Employer cost **passes through at cost, itemised** on every invoice, including PRSI and the new auto-enrolment pension contribution.

EOR payroll, contractor onboarding, and entity setup all live on **one platform**. An Irish contractor who converts to PAYE keeps their record. That same employee can **graduate** from EOR to your own Irish entity without switching systems. Run the [Crossover Calculator](https://www.teamed.global/tools/crossover-calculator) to see the month the model flips. EOR is the right model for a first Irish hire, **until it isn’t**. Start from the Ireland hiring overview; each guide here takes one layer of Irish employment law.

Key sources: [Revenue PAYE Modernisation](https://www.revenue.ie/en/employing-people/paying-your-employees-tax-to-revenue/index.aspx), [Department of Social Protection PRSI rates](https://www.gov.ie/en/department-of-social-protection/publications/prsi-class-a-rates/), and [Workplace Relations Commission](https://www.workplacerelations.ie/).

## Frequently asked questions

What is the employer PRSI rate in Ireland in 2026?

Employer PRSI is 11.25% on Class A earnings above EUR 496 per week, from 1 January to 30 September 2026. From 1 October 2026 the rate rises to 11.40%. There is no earnings ceiling and no allowance to offset the liability.

What PRSI does an Irish employee pay?

Employee PRSI is 4.2% on earnings above EUR 352 per week. There is no upper earnings limit. From 1 October 2026 the rate rises to 4.35%. The employee also pays the Universal Social Charge and income tax on top of PRSI.

What are the income tax bands in Ireland in 2026?

Ireland has two income tax bands for a single person. Income up to €44,000 is taxed at 20%. Income above that is taxed at 40%. There is no income tax rate above 40% in Ireland. Tax credits reduce the effective liability; most employees pay no net income tax below roughly EUR 19,750.

How does payroll filing work in Ireland?

Under PAYE Modernisation, employers submit a Payroll Submission Request to Revenue on or before each payday. Revenue generates a monthly statement by the 5th of the following month; the employer accepts it by the 14th. The combined PAYE, USC, and PRSI payment is due electronically by the 23rd of the following month.

What are the Irish auto-enrolment pension contribution rates?

Ireland launched auto-enrolment on 30 September 2025. In years 1 to 3, the employer contributes 1.5%, the employee contributes 1.5%, and the state adds 0.5%. Rates step up every three years. The scheme covers employees aged 23 to 60 earning over EUR 20,000 a year who are not already in a qualifying pension scheme.

Teamed Legal Operations

The most common Ireland payroll mistake we see is not accounting for the October PRSI rate increase in the original offer model. Employers budget at 11.25% for the whole year, then find the last quarter costs more. Run both the Jan to Sep rate and the October rate before you sign a contract.

A note from Tom Price-Daniel

Ireland taxes income at 20% up to €44,000, then 40% above that. Add 11.25% employer PRSI, auto-enrolment pension at 1.5%, and a mid-year PRSI increase in October 2026.  
Three charges on every payslip. Two rate changes in one calendar year.  
Get the numbers right before you make the offer.

Tom Price-Daniel · Co-founder, Teamed

## Related Ireland guides

- Hiring in Ireland, overviewparent
- [Ireland termination and severance](/country-hiring-guides/ireland/termination-and-severance)sibling
- [UK tax and payroll](/country-hiring-guides/united-kingdom/tax-and-payroll)neighbour
- [Employer of Record overview](/lp/employer-of-record)core
- [Pricing, Zero FX Fixed](/pricing)core
- [Employer Cost Calculator](https://www.teamed.global/tools/employer-cost)tool
- [Talk to an expert](https://www.teamed.global/contact)CTA

A note on this page.

This is a guide, not legal, tax or accounting advice. Rules change and vary by jurisdiction. Verify current requirements with Revenue Commissioners (revenue.ie) and the Department of Social Protection (gov.ie) before relying on any specific figure. PRSI rates for both employer and employee rise from 1 October 2026. The auto-enrolment pension scheme launched on 30 September 2025; contribution rates step up every three years under the Automatic Enrolment Retirement Savings System Act 2024.