Reminder: Auto-Enrolment in Ireland

Introduction

From 1 January 2026, Ireland will introduce a new auto-enrolment pension scheme called MyFutureFund. This scheme will automatically enroll eligible employees, with contributions from the employee, employer, and the Government. The goal is to help more people save for retirement by making pension participation automatic. Here’s a summary of how it works.

Who is Automatically Enrolled?

Employees aged 23-60, earning €20,000 or more per year (or €5,000 over 13 weeks), and not paying into a pension through payroll will be automatically enrolled. Employees who don’t meet these criteria can still opt in.

Employer Participation:

Employers must participate in the scheme if an employee is eligible or opts in. Employers who fail to contribute may face penalties.

Existing Workplace Pensions:

Employees with an existing pension plan through their employer will not be enrolled in MyFutureFund.

Contribution Structure:

• Employee: Initially contributes 1.5% of salary.
• Employer: Matches the employee’s contribution (1.5%).
• Government: Adds 0.5%.
• Total contribution in the first year: 3.5% of salary, increasing to 6% by year 10.

Opting Out:

Employees can opt out after 6 months but must remain in the scheme for at least that long. Contributions will be refunded if opting out within 8 months.

Suspending Contributions:

After 6 months, employees can pause contributions but must wait 12 months before resuming them.

Re-enrolment:

If you leave or suspend your contributions, you will be automatically re-enrolled after 2 years if you are still eligible, unless you are contributing to another pension.

What Happens to Savings If You opt Out?

If you opt out, your contributions (plus employer and government contributions) remain in your fund and continue to be invested.

Comparison with Personal Pensions:

Whether auto-enrolment is better than a personal pension depends on individual circumstances, and employees are encouraged to compare the benefits.

Conclusion

The MyFutureFund auto-enrolment scheme aims to ensure more people save for retirement by automatically enrolling eligible employees. With a clear contribution structure and options to opt out or pause contributions, the scheme offers flexibility while encouraging long-term savings. Employers must comply with the new regulations by 1 January 2026, and employees should be aware of their rights and options within the scheme.