PRSA Requirement ( Current):

• Employers must continue to offer at least one PRSA payroll deduction scheme on a voluntary basis. This remains in place until the new Auto-Enrolment ( AE) system is fully operational.

National Auto-Enrolment Retirement Savings Starts January 1, 2026:

• Employee aged 23 to 60 who earns €20,000 or more per year and don’t already contribute to a workplace pension will automatically enroll in the new AE scheme.

Employer Responsibilities: Refer to Auto-enrolment retirement savings system for employees

• Register with the AE authority ( NAERSA) to manage contributions
• Enroll eligible employees into the AE Scheme
• Match contributions according to a phased schedule starting at 1.5% and increasing over time. See chart below

Opt-Out Rules: Refer to: Auto-enrolment retirement savings system for employees

• Employee can only opt out after a full 6 months of being enrolled if they do not want to participate in any payroll deduction scheme.
• Can opt out after each contribution rate increase

Employees that currently have PRSA with Zurich:

• They are not subject to the AE since they are currently participating in a private pension through our payroll deduction scheme
• Does the employer ( XML) need to contribute the 1.5% to an employee existing PRSA private pension through payroll? “ No Employers are not required to contribute to an employee’s existing private PRSA pension, they are only required to match the AE. However, best to seek legal advice to avoid any potential audit on differential treatment.”

Can employees have both AE & PRSA- Zurich?

• No, employee can only have one payroll deduction pension scheme, either AE or PRSA
• If an employee wants to join a PRSA instead of AE, they can opt out of AE immediately, and don’t have to wait the 6 months.
• If an employee wants to stop AE without switching to a PRSA, they must wait the full 6 months before opting out.

Benefit in staying with a PRSA:

• Employee may want to contribute more than the AE Limits
• Earns over €80,000 as PRSA allow for higher tax relief on contributions

Disadvantages for Employer to offer both PRSA and AE:

• Increase administrative burden and payroll coordination. ER must ensure that contributions are within the salary cap
• ER needs to accurately track who is on which scheme and handle opt-ins and out correctly
• AE has strict rules and timelines, while PRSAs are more flexible . Handling both increases the risk of non-compliance
• Offering both options for employees to pick from may cause confusion if they don’t understand the differences in tax relief , contribution limits or long-term benefits.