Employer social-insurance costs in Ireland
Reviewed by Mellow Editorial Team, HR & payroll content team
Employer PRSI in Ireland currently sits at 11.15% of an employee's gross reckonable earnings under Class A, which applies to the majority of employees in private-sector employment. This is on top of the employee's own PRSI contribution and is a direct cost to the employer, separate from gross salary.
What is employer PRSI and who pays it
PRSI — Pay Related Social Insurance — funds a range of state benefits including Jobseeker's Benefit, Illness Benefit, and the State Pension. Both the employer and employee contribute, but at different rates.
For most employees on a standard employment contract, Class A applies. Under Class A, the employee contributes approximately 4.1% of their gross reckonable pay. The employer contributes 11.15%. These are separate charges — the employee's portion is deducted from their wages, while the employer's portion is an additional cost on top of the salary you have agreed to pay.
If you are budgeting for a new hire, the total PRSI cost sits entirely with you as the employer. An employee earning €50,000 gross will cost you an additional €5,575 in employer PRSI alone before you factor in any other on-costs.
How employer PRSI fits into the wider payroll deduction picture
When you run payroll in Ireland, three main deductions come off an employee's gross pay: income tax, USC, and employee PRSI. You, as the employer, manage all of these on Revenue's behalf through the PAYE system. But employer PRSI is different — it is not a deduction from the employee's wages. It is a separate liability you carry.
For reference, the other elements affecting an employee's take-home pay work as follows. Income tax is charged at 20% up to the standard rate cut-off point (around €44,000 for a single person in 2026/27) and 40% on earnings above that. Ireland does not use a personal allowance; instead, it uses a system of tax credits, which reduce the actual tax liability directly. USC is applied in bands at 0.5%, 2%, 3%, and 8% depending on earnings. Employee PRSI is approximately 4.1% under Class A.
As the employer, you calculate, deduct and remit all of these on the employee's behalf. Employer PRSI is then added to that remittance as your own separate contribution.
Real-time reporting and when payment is due
Ireland operates a real-time PAYE system. Each time you pay an employee, you must submit a payroll submission to Revenue through ROS (Revenue Online Service) on or before the date of payment. There is no end-of-month catch-up — the submission must happen before or on payday.
This submission includes the employee's gross pay, all deductions, and the employer PRSI due. Revenue uses this data to maintain each employee's tax record in real time.
Payment of the liabilities — including employer PRSI — is made monthly for most employers, by the 23rd of the following month if paying online through ROS. Smaller employers may qualify for a quarterly payment schedule. Staying on top of these deadlines matters; late payment attracts interest charges.
Different PRSI classes and when they apply
Not all employees fall under Class A. The class that applies depends on the nature of the employment and the individual's circumstances. Class S applies to self-employed people, including proprietary directors in certain situations. Modified PRSI classes apply to some public servants and employees in older pension schemes. These carry different contribution rates.
If you are unsure which class applies to a particular worker, Revenue's guidance and the PRSI class determination process can help you establish the correct treatment before you run your first payroll for that person. Getting the class wrong creates a compliance problem that is much easier to prevent than to unwind.
Auto-enrolment and future employer contributions
From 2026, Ireland's pension auto-enrolment scheme — known as My Future Fund — is being introduced. This will require employers to make pension contributions on behalf of eligible employees who are automatically enrolled. The scheme is being phased in gradually, with both employer and employee contribution rates increasing over time.
My Future Fund is separate from PRSI but adds another layer of mandatory employer cost to factor into workforce planning. Employers who have not yet reviewed their payroll systems and cost models in light of auto-enrolment should do so promptly, as the obligations apply from the point of enrolment, not from when you first become aware of them.
Understanding how Mellow runs payroll across six countries on one platform can give useful context if you are managing employees in multiple jurisdictions alongside your Irish headcount.
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