Adding starters to payroll in Ireland
Reviewed by Mellow Editorial Team, HR & payroll content team
Adding a new employee to payroll in Ireland requires you to register them with Revenue before their first payday, set up their tax deduction details correctly, and make real-time submissions on or before each pay date. Get any of those steps wrong and you risk deducting the wrong tax or falling foul of Revenue.
Register the employee with Revenue first
Before you run your first payroll for a new starter, you need to notify Revenue through the Revenue Online Service (ROS). This is done by adding the employee to your employer record using their PPS number, start date, and the pay frequency you will use.
Once registered, Revenue will issue a Revenue Payroll Notification (RPN) for that employee. The RPN tells you their tax credits, standard rate cut-off point, and any USC status (such as an exemption). You must retrieve this RPN before calculating their first pay — it is the basis for every deduction you make.
If you cannot get an RPN before the first payday — for example, the employee has not yet provided their PPS number — you must operate emergency tax instead. Emergency tax uses a zero-credit, higher-rate basis that results in the employee being significantly overtaxed. It is corrected once a valid RPN is received, but it creates friction for the employee, so getting the PPS number before day one is worth the effort.
Understanding the deductions you will make
Every employee on Class A PRSI pays three deductions from gross pay:
- Income tax at 20% up to the standard rate cut-off point (roughly €44,000 for a single person in 2026/27, though the employee's personal cut-off will be stated on their RPN), and 40% above that.
- USC (Universal Social Charge) on a banded basis: 0.5%, 2%, 3%, and 8% at different income levels.
- PRSI at approximately 4.1% (employee share).
As the employer, you also pay the employer share of PRSI at approximately 11.15% on top of gross pay. This is your own cost — it is not deducted from the employee's wages.
Ireland operates a tax credit system, not a personal allowance. This means the employee's credits (personal tax credit, PAYE credit, and any others they hold) are applied to reduce the actual income tax liability after the rate has been calculated. The RPN reflects these credits, so as long as you apply the RPN correctly, the system handles the credit offset automatically.
The real-time payroll submission
Ireland uses real-time PAYE reporting. You must submit a Payroll Submission Request (PSR) to Revenue on or before each payday — not monthly, not at year end, but each time you pay someone. The PSR is filed through ROS, either directly or via payroll software that connects to ROS.
The PSR records gross pay, income tax deducted, USC deducted, PRSI (both employee and employer shares), and the pay date. Revenue uses this data to maintain each employee's live tax position throughout the year. Late or missed submissions can trigger compliance notices, so building the submission into your payroll run — not as an afterthought — is essential.
What the employee needs to do
Your new starter should register for myAccount on Revenue's website if they have not already done so. From there, they can manage their own tax credits, declare additional income, and see their tax position. If they are moving from another employer, their credits will already be in the system; Revenue simply links those credits to your employer registration once you add them.
Employees should also give you their PPS number and confirm their address — you need both for the Revenue registration. If they are new to Ireland and do not yet have a PPS number, they must apply through the Department of Social Protection before you can set them up correctly.
Payroll records and employment documentation
Beyond the Revenue registration, there are employment law obligations that sit alongside payroll. You must provide a written statement of core employment terms within five days of the start date (a requirement under the Employment (Miscellaneous Provisions) Act 2018), and a full contract is best practice.
From a payroll records perspective, you are required to keep accurate records of hours worked, wages paid, and deductions made. These must be retained for several years and be available for inspection by the Workplace Relations Commission (WRC) or Revenue if requested.
One further point to note: pension auto-enrolment under the "My Future Fund" scheme is being introduced from 2026. This will require employers to enrol eligible employees automatically and make matching contributions, adding a new layer to the onboarding payroll setup. It is worth familiarising yourself with the scheme requirements now so that new starters are enrolled correctly from the outset.
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