Global Partner. Integrated Solutions.
26 October 2026
Ireland PRSI Rate Increase Effective 1 October 2026
 
At a glance
From 1 October 2026, Ireland's PRSI rates increase by 0.15%: employee Class A rate rises to 4.35%; employer lower rate to 9.15% and standard rate to 11.40%. A further 0.15% increase is scheduled for 2027, with a 0.20% increase planned for 2028.

PRSI (Pay Related Social Insurance) contributions in Ireland are compulsory payments that employees and employers make into the Social Insurance Fund, which finances social welfare benefits and pensions. Starting from 1 October 2026, PRSI rates have increased by 0.15%, with a further increase of the same rate in 2027. This increase is part of a phased plan to secure the long-term financial sustainability of the National Social Insurance Fund and to strengthen the State Pension system.

Increase in PRSI rates
  • The employee Class A rate has increased from 4.20% to 4.35%, slightly reducing net take-home pay.
  • The employer's lower rate has increased from 9% to 9.15%, and the standard rate has increased from 11.25% to 11.40%.
Next steps for employers

To ensure a seamless transition, employers should undertake the following steps:
  • Software configuration: Coordinate with your payroll software vendor to ensure system updates are deployed and tested.
  • Internal audit: Verify that the new 0.15% calculation is accurately reflected in both the employer and employee deduction lines during the first October pay run.
  • Employee communication: Proactively inform employees of the minor reduction in their net pay due to the mandatory statutory rate increase.
Our Comments

While a 0.15% increase may appear minimal on an individual level, the cumulative impact across a large workforce represents a definitive increase in the total cost of employment (TCE). Global organizations operating in Ireland must ensure that their operational budgets are realigned immediately. This increase is part of a strict, multi-year escalation pathway. Companies should explicitly factor the scheduled 0.15% increase for 1 October 2027 and the further 0.20% increase for 1 October 2028 into their rolling three-to five-year fiscal forecasts to prevent mid-year budget variances.

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