Hiring someone in Ireland means taking on a specific set of payroll obligations from day one. You’ll need to register with Revenue before you run your first payroll, withhold the correct income tax, USC, and PRSI from each employee’s pay, and keep up with rates that changed at the start of 2026. This guide covers everything you need to know to run Irish payroll correctly.
Payroll frequency and payment date
Ireland runs on a monthly payroll cycle. Most employers process pay on or around the 27th of each month, which gives employees a predictable schedule and gives finance teams enough time to close the books before month-end.
Weekly and fortnightly payroll cycles exist but are far less common. Whatever frequency you choose, you must report payroll data to Revenue in real time through its online portal, using the PAYE Modernisation system that has been in place since 2019.
Minimum wage in 2026
The national minimum wage increased on 1 January 2026. The rates depend on the employee’s age:
| Age | Hourly rate |
|---|---|
| 20 and over | €14.15 |
| 19 | €12.74 |
| 18 | €11.32 |
| Under 18 | €9.91 |
The standard full-time working week in Ireland is 39 hours. There’s no statutory 13th-month salary requirement, so you don’t need to budget for an additional month’s pay at year-end unless it’s written into the employment contract.
How irish payroll deductions work
Every payroll run involves three separate deductions from an employee’s gross pay: income tax under the PAYE system, the Universal Social Charge (USC), and Pay Related Social Insurance (PRSI). Here’s how each one works.
Income tax (paye)
Ireland uses a two-rate income tax system. A single person pays 20% on income up to €44,000 per year and 40% on anything above that threshold. The cut-off points are different for married couples and civil partners, but the rates themselves stay the same.
You withhold income tax through the PAYE system on every payroll run. Revenue issues each employee a tax credit certificate that tells you their personal tax credits and rate band, and your payroll software uses that certificate to calculate the correct withholding amount each period.
Universal social charge (usc)
The USC is a separate charge applied to gross income before pension contributions. The 2026 bands are:
- 0.5% on the first €12,012
- 2% on €12,012.01 to €28,700
- 3% on €28,700.01 to €70,044
- 8% on income above €70,044
Employees whose total annual income is under €13,000 are exempt from USC entirely. Medical card holders and people over 70 with income under €60,000 pay a reduced rate, so it’s worth checking each employee’s status when you onboard them.
Prsi
PRSI funds Ireland’s social insurance system, covering benefits like jobseeker’s payments and the state pension. Both the employee and the employer contribute.
For most employees in Class A (the standard employment class):
- Employee rate: 4.2% from January through September 2026, rising to 4.35% from 1 October 2026. Employees earning €352 or less per week are exempt.
- Employer rate: 9% on weekly earnings up to €552, and 11.25% on earnings above that threshold, from January through September 2026. From 1 October 2026, those rates increase to 9.15% and 11.40% respectively.
PRSI is calculated on gross pay and is reported to Revenue on every payroll submission.
Employer prsi and auto-enrolment
Employer PRSI is one of your largest payroll costs in Ireland. At the standard rates, you’re contributing between 9% and 11.25% of each employee’s gross pay on top of their salary, depending on where their earnings fall relative to the €552 weekly threshold. That increases to between 9.15% and 11.40% from October 2026.
From 1 January 2026, Ireland also launched a mandatory auto-enrolment pension scheme. Under the initial phase, both you and your employee contribute 1.5% of the employee’s gross salary. The scheme is designed to phase up over time, but 1.5% is the starting rate. This is separate from any occupational pension scheme you already run, so check whether your existing arrangements satisfy the auto-enrolment rules or whether you need to enrol employees separately.
Payslip requirements
You’re legally required to give every employee a payslip on or before each pay date. The payslip must show:
- Gross pay
- All deductions, listed individually (PAYE, USC, PRSI)
- Net pay
Most Irish employers issue payslips digitally through their payroll software, but a physical payslip also satisfies the requirement. You can’t replace a payslip with a bank transfer notification; the deduction breakdown must be clearly itemised.
Registering for paye
You must register with Revenue as an employer before you pay anyone. You can’t run payroll first and register later. The registration process goes through Revenue’s myAccount portal (for individuals) or Revenue Online Service (ROS) for businesses.
Once you’re registered, Revenue will give you an employer registration number. You’ll use that number on every payroll submission. You’ll also need to ensure each new employee’s tax credit certificate is received from Revenue before their first pay run, so that you’re applying the correct rate band and credits from day one.
If you’re setting up an Irish entity from outside the country, allow enough time for the registration process before your employee’s first pay date. Delays in employer registration are one of the most common reasons international companies run late on their first Irish payroll.
Running irish payroll through an Employer of Record
If you want to hire in Ireland without setting up a local entity, an Employer of Record (EOR) handles the entire payroll process on your behalf. The EOR employs your worker legally in Ireland, runs payroll under Irish law, withholds PAYE, USC, and PRSI correctly, files submissions with Revenue, and manages auto-enrolment obligations, while you retain full day-to-day control over the employee’s work.
This is a common route for companies expanding into Ireland for the first time or hiring a small number of people before committing to a local entity. If you’re comparing providers, look at EOR services that have established Irish payroll infrastructure and can handle the October 2026 PRSI rate changes automatically.
Book a demo to see how RemotePass handles Irish payroll end to end.
Frequently asked questions
What payroll taxes does an employer pay in ireland?
Your main employer-side cost is PRSI, which runs between 9% and 11.25% of gross salary depending on the employee’s weekly earnings (rising to 9.15% and 11.40% from October 2026). From January 2026 you also contribute 1.5% of gross salary into the mandatory auto-enrolment pension scheme. You don’t pay income tax or USC on behalf of employees; those are withheld from the employee’s gross pay.
Is there a 13th-month salary requirement in ireland?
No. Ireland has no statutory 13th-month or annual bonus requirement. If a contract includes a bonus or additional payment, you’re obligated to pay it, but there’s no legal requirement to offer one in the first place.
When do prsi rates change in 2026?
Both employee and employer PRSI rates increase on 1 October 2026. The employee rate moves from 4.2% to 4.35%. Employer rates move from 9%/11.25% to 9.15%/11.40%, depending on the weekly earnings threshold. These changes apply from the first pay period that includes 1 October.
What is an Employer of Record and how does it work in ireland?
An Employer of Record is a third-party company that employs workers on your behalf in a country where you don’t have a legal entity. In Ireland, the EOR handles Revenue registration, payroll processing, tax withholding, PRSI filings, and auto-enrolment. You manage the employee’s work and pay the EOR a service fee. It’s a straightforward way to hire in Ireland without the cost and time of setting up an Irish company.
