HR and payroll for creative agencies in Ireland
Reviewed by Mellow Editorial Team, HR & payroll content team
Creative agencies in Ireland face the same payroll obligations as any other employer, but the mix of permanent staff, freelancers, contractors and project-based workers makes getting those obligations right considerably more complicated. Here is a practical guide to the main areas you need to manage.
The employment status question
Before you process a single payslip, you need to be clear on how each person working for your agency is engaged. Irish Revenue and the Workplace Relations Commission (WRC) both scrutinise employment status, and getting it wrong is costly.
The core distinction is between an employee and a self-employed contractor. An employee has PAYE, PRSI and USC deducted at source by you, the employer. A contractor operating through their own limited company invoices you, and tax is their responsibility. A contractor engaged directly as an individual — without a company structure — may well be deemed an employee in practice, regardless of what the contract says.
Creative agencies often rely on freelance designers, copywriters, developers and directors for project work. If those people work exclusively or predominantly for you, follow your direction on how the work is done, and use your equipment, Revenue is likely to treat them as employees. If they are reclassified after the fact, you become liable for unpaid PAYE, PRSI and any penalties on top.
Take advice if you are unsure. The Revenue Code of Practice for Determining Employment or Self-Employment Status of Individuals is the practical starting point.
Running payroll for your permanent team
For employees, you operate PAYE in real time. Every time you pay someone, you submit a payroll submission to Revenue via ROS on or before payday. There is no grace period — the submission must arrive before or on the date wages hit the employee's account.
Deductions for each employee follow a consistent structure:
- 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% above that. Ireland does not use a personal allowance system; instead, employees have tax credits that reduce the actual tax liability. The personal tax credit and employee tax credit are the most common. Employees should keep their tax credits current via myAccount on Revenue Online Service.
- USC is levied in bands: 0.5%, 2%, 3% and 8%, applying to gross income above a low exemption threshold. Most full-time employees in an agency will have earnings that move through several USC bands.
- PRSI Class A applies to most employees. The employee contributes approximately 4.1% of gross pay; you, as employer, contribute approximately 11.15%. Employer PRSI is a significant employment cost that agencies sometimes underestimate when budgeting for a new hire.
Your payroll software handles the arithmetic once set up correctly, but you remain responsible for the accuracy of what is submitted.
Managing variable pay and project bonuses
Creative agencies often have variable pay elements — project bonuses, profit share, overtime for production staff. All of these are subject to PAYE, PRSI and USC in the same way as regular salary. There is no special treatment for creative-sector bonuses.
If you pay a bonus in a separate run outside the normal pay cycle, you still need to submit a payroll file to Revenue on or before that payment date. Running an off-cycle payment without a submission is a compliance breach.
Commission paid to account managers or business development staff is treated identically to salary for tax purposes.
Pension auto-enrolment from 2026
My Future Fund, Ireland's pension auto-enrolment scheme, is being introduced from 2026. For creative agencies, this is likely to affect the majority of your permanent staff who are not already in a qualifying occupational pension scheme.
Under auto-enrolment, both employee and employer will make contributions, with the State adding a top-up. Employees can opt out, but you cannot exclude them from being enrolled in the first instance. You will need to assess which employees qualify, ensure your payroll process can handle the new deductions, and factor employer contributions into your headcount costs. If you are currently budgeting for hires in late 2026 or 2027, build this cost in now.
Annual leave and employment rights in a project-based environment
Statutory annual leave in Ireland is four working weeks per year. In agencies where workloads spike around pitches, campaigns or productions, there is a common temptation to let leave accumulate. Irish employment law limits the carryover of leave, and employees are entitled to take their leave — not just accrue it on paper.
Part-time and irregular-hours workers, including those on variable creative contracts, accrue leave based on hours worked. If you engage someone on a fixed-term contract for a three-month project, they are entitled to statutory leave for that period. Failing to account for this creates WRC exposure.
Keep leave records accurate and up to date. If you use a time-tracking or project management tool already, check whether it connects to your HR system — duplicate data entry across creative production tools and HR records is a common source of error in smaller agencies.
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