Q. I am working for the last few years in the same job, we have no workplace pension and I hear people lately talking about next year’s auto-enrolment. What is it exactly and will I be covered?
Auto-enrolment is a new pension savings scheme for certain employees who are not paying into a pension. The introduction of the Auto-Enrolment Retirement Savings Scheme, called My Future Fund, will start from January 1, 2026.
Under the scheme, the employee, employer, and government all pay a certain amount into the employee’s pension fund. Qualifying employees will be automatically included in the scheme, but you can opt out after six months. A new public body, the National Automatic Enrolment Retirement Savings Authority (NAERSA) will administer the auto-enrolment scheme and the scheme is supervised by the Pensions Authority.
What does it mean for me and who will be automatically enrolled?
You will be automatically enrolled in the new pension scheme if you are an employee and: you are aged between 23 and 60, you are not currently part of a pension plan and; you earn €20,000 or more per year.
If you earn less than €20,000 per year, or you are aged under 23 or over 60, you can choose to join My Future Fund if you are not already part of a pension plan.
What happens if I already have a workplace pension?
If you are paying into your workplace pension through payroll, you will not be auto-enrolled for that employment. If you have another job where you are not making pension contributions, you can be auto-enrolled or opt into the scheme for that job.
How much do I pay?
The amount you pay will be a set percentage of your annual salary. Your employer will match your contributions, and the government will contribute an additional amount. You cannot pay more or less than the set rate. You and your employer will pay 1.5 per cent of your annual salary in the first year. This will increase to six per cent by year 10. The government will contribute 0.5 per cent, rising to two per cent by year 10.
Both the employer’s and the government’s contributions are capped at €80,000 gross annual salary. This means that for the first three years, the maximum amount an employer can contribute is €1,200 a year (1.5 per cent of €80,000 is €1,200). The maximum amount the government can contribute is €400 a year (0.5 per cent of €80,000).
If you earn over €80,000, you can still contribute but your employer or the government won’t match your contributions on any income over €80,000