Rates, thresholds, October changes and what employers actually pay
Employer PRSI is an extra payroll cost your business pays on top of an employee’s gross wages. For most private-sector employees, Class A applies. In 2026, the standard higher employer rate was 11.25% up to 30 September and is 11.40% from 1 October. The lower rate depends on the employee’s weekly earnings and PRSI subclass. It is not one blanket rate for everyone earning €552 or less.
The practical question is simple: what PRSI class and subclass applies to this employee on this pay date, and what earnings count? Get those three things right and your payroll budget becomes much easier to manage.
| 2026 at a glance | What you need to know |
|---|---|
| Higher Class A rate | 11.25% to 30 September; 11.40% from 1 October |
| Class A lower bands | 9.00% or 9.15% from October, depending on subclass |
| Higher-rate threshold | More than €552 in weekly reckonable earnings |
| Employer cost | Added to gross pay, not deducted from take-home pay |
Employer PRSI Rates for 2026
Class A is the usual class for employees working under a contract of service. The Department of Social Protection (DSP) publishes the following employer rates. These rates apply to all reckonable earnings within the relevant subclass, not just the portion above a threshold.
| Weekly reckonable earnings | Subclass | 1 Jan to 30 Sep | From 1 Oct |
|---|---|---|---|
| €38 to €352 | A0 | 9.00% | 9.00% |
| €352.01 to €424 | AX | 9.00% | 9.15% |
| €424.01 to €552 | AL | 9.00% | 9.15% |
| More than €552 | A1 | 11.25% | 11.40% |
Important: the October increase does not affect the A0 employer rate. It stays at 9.00%. Some short summaries of the 2026 change describe a 9.15% lower rate without mentioning this exception, so check the actual subclass before calculating your liability.
Why the €552 threshold matters
The higher Class A employer rate starts when weekly reckonable earnings exceed €552. At exactly €552, an employee is still in subclass AL. The threshold increased from €527 at the start of 2026 alongside the rise in the national minimum wage to €14.15 an hour. At 39 hours per week, that wage produces €551.85, within the lower band.
A threshold is not an annual exemption or a tax-free slice. If the employee is in A1 for a pay period, the higher employer rate is charged on all reckonable earnings for that period.
How Much Employer PRSI Adds to Payroll
Here is a straightforward example for one employee paid €1,000 gross per week, with no special PRSI treatment or additional taxable benefits.
| Annual gross pay | Assumed class | Illustrative 2026 employer PRSI | Gross pay plus PRSI |
|---|---|---|---|
| €25,000 | A1 throughout | €2,259.38 | €27,259.38 |
| €35,000 | A1 throughout | €3,950.63 | €38,950.63 |
| €50,000 | A1 throughout | €5,643.75 | €55,843.75 |
| €70,000 | A1 throughout | €7,901.25 | €77,901.25 |
A bonus, commission payment, change in hours or a shift in subclass can change the amount. For a full employment budget, other expenses such as pensions, paid leave, recruitment and equipment matter too.
Which Date Determines the PRSI Rate?
Use the pay date, not the date the employee did the work. A September salary paid on 5 October 2026 uses the October PRSI rates. A September salary paid on 25 September uses the earlier rates. Check the payment date entered in payroll and confirm your software has the updated Class A tables.
Weekly, Fortnightly and Monthly Payroll
The €552 dividing line is weekly. For an employee paid less frequently, use the corresponding pay-period threshold, subject to the official payroll rules.
| Pay frequency | Indicative dividing threshold |
|---|---|
| Weekly | €552.00 |
| Fortnightly | €1,104.00 |
| Four-weekly | €2,208.00 |
| Monthly | €2,392.00 (€552 × 52 ÷ 12) |
Variable overtime or commissions may move an employee into a different subclass in a particular pay run. Do not decide the rate once at hiring and assume it will never change.
What Pay Is Employer PRSI Calculated On?
Employer PRSI usually applies to reckonable earnings, including more than basic salary. You should account for the taxable value of benefits as well as cash payments where PRSI rules require it.
- Salary, wages, overtime, commissions and cash bonuses.
- Holiday pay, public-holiday pay and employer-paid statutory sick pay.
- Taxable allowances and benefits in kind, such as private use of a company car or employer-paid medical insurance, where chargeable.
For instance, a taxable company-car benefit worth €5,000 adds to reckonable pay. If the employee remains in A1, that benefit alone creates €570 of employer PRSI at the October 2026 rate of 11.40%, assuming the whole benefit is charged at that rate.
| Payment | Practical treatment |
|---|---|
| Employer occupational pension contributions | Generally not subject to employer PRSI when qualifying rules are met. |
| Employer PRSA or PEPP contributions | Generally excluded within the relevant employer contribution rules; excess contributions may create a taxable benefit. |
| Qualifying share-based remuneration | Employer PRSI generally not charged on qualifying share-based remuneration; employee PRSI may still arise. |
| Cash-settled or phantom share awards | Do not automatically treat these as exempt shares: cash payments may be reckonable pay. |
| Statutory redundancy payment | Generally exempt from PRSI. |
Does the National Training Fund Levy Cost Extra?
No additional 1% should be added to the published Class A employer rates. The National Training Fund Levy is already built into those rates. An employer using 11.40% should not calculate 11.40% plus another 1% levy. Class H rates also include the levy.
Employer PRSI and MyFutureFund
MyFutureFund, Ireland’s automatic enrolment retirement savings scheme, started contributions from 1 January 2026. This is a separate employer cost, not part of PRSI. For an employee enrolled in the scheme, the employer contribution is 1.5% of qualifying gross earnings during the initial 2026 to 2028 period, subject to the scheme’s €80,000 annual earnings cap and applicable scheme rules.
Take an illustrative €50,000 employee who is enrolled for the whole of 2026 and remains A1. Employer PRSI is about €5,643.75 under the even-pay assumptions above. The employer’s MyFutureFund contribution is €750. Together with salary, that makes approximately €56,393.75 before other employment costs. If the worker is not enrolled, do not add that contribution.
Eligibility and any existing qualifying pension arrangements must be checked. MyFutureFund is not an automatic extra contribution for every person on the payroll.
What About Other PRSI Classes?
Not every employee is Class A. Modified-rate employments, certain Defence Forces personnel, people in subsidiary employment and some directors need a different analysis. The rates below are employer percentages for the named classes; choose the correct class by the employment rules, not by which rate is cheaper.
| Class | To 30 Sep 2026 | From 1 Oct 2026 | Typical context |
|---|---|---|---|
| B | 2.21% | 2.36% | Certain pre-1995 public service roles |
| C | 2.05% | 2.20% | Certain pre-1995 commissioned Defence Forces roles |
| D | 2.55% | 2.70% | Other eligible pre-1995 public servants |
| H | 10.55% | 10.70% | Certain Defence Forces personnel |
| J | 0.70% | 0.85% | Specified low-pay, subsidiary or pension-age employments |
| S | No employer PRSI | No employer PRSI | Self-employment, including some company directors |
Company directors require particular care. A Class S director may still be paid through company payroll, with their own Class S contribution deducted and remitted, even though no employer PRSI is due. A director is not automatically Class S or Class A simply because of their job title.
Do not automatically switch an employee to Class J on their 66th birthday. For people born on or after 1 January 1958, PRSI may continue to apply until State Pension (Contributory) is awarded or age 70, depending on the circumstances. Check the employee’s date of birth, pension status and insurability.
The PRSI Roadmap Through 2028
Legislated increases have lifted PRSI rates in stages since October 2024, with further increases scheduled in 2027 and 2028. For a conventional Class A A1 employee, the higher employer rate moved from 11.15% in October 2024 to 11.25% in October 2025 and 11.40% in October 2026. Under the existing schedule, further increases would take that rate to 11.55% in October 2027 and 11.75% in October 2028, unless legislation changes.
Treat the later-year figures as scheduled rates, not a substitute for checking official tables when budgeting or running those future payrolls. Future thresholds and class-specific details may also change.
How to Report and Pay Employer PRSI
Employers report pay and statutory deductions in their payroll submissions to Revenue on or before the pay date. Employer PRSI forms part of the PAYE/PRSI/USC liability shown on the monthly statement, normally made available by the 5th of the following month. The statement becomes the monthly statutory return when accepted, or is deemed accepted on the 14th.
Payment is normally due by the 14th of the following month, extended to the 23rd where the conditions for ROS electronic filing and payment are met. Revenue notes that late-payment interest is charged at 0.0274% per day from the 14th where payment is late. Some qualifying smaller employers may be approved for quarterly remittances, although payroll submissions remain due on each pay date.
A Quick Employer PRSI Check Before Each Pay Run
- Confirm the employee’s PRSI class and subclass, especially after a role or status change.
- Use the correct payment date, including the 1 October 2026 rate change.
- Check the full reckonable pay, including taxable benefits and variable payments.
- Verify whether the €552 weekly threshold or its pay-frequency equivalent changes the subclass.
- Check employee age and State Pension (Contributory) status before switching classes.
- Reconcile employer PRSI in the payroll submission with Revenue’s monthly statement.
- Keep your calculation records and resolve mismatches rather than carrying them forward.
If your team is spending too much time checking subclasses, BIK, payment dates and payroll reconciliations, a professional payroll review can help prevent small mistakes from becoming expensive corrections.
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Employer PRSI Frequently Asked Questions
Q. Is employer PRSI deducted from wages?
A. No. The employer pays it in addition to agreed gross pay. Employee PRSI, PAYE and USC are separate employee deductions.
Q.What happens if somebody earns exactly €552 a week?
A. For ordinary Class A employment, they remain within subclass AL, not A1. The higher employer rate applies when weekly reckonable earnings are more than €552.
Q. Did every lower-rate employee move to 9.15% in October 2026?
A. No. The A0 employer rate for weekly earnings between €38 and €352 remains 9.00%. AX and AL rise to 9.15% from 1 October 2026.
Q. Is there a cap on employer PRSI for highly paid staff?
A. There is generally no upper annual earnings ceiling on Class A employer PRSI. High earnings and chargeable benefits can increase the employer contribution.
Q. Does employer PRSI apply to a company car?
A. Generally yes. Where the car gives rise to taxable benefit in kind, its cash equivalent is included in reckonable pay for the applicable PRSI calculation.
Q. Is the MyFutureFund contribution included in employer PRSI?
A. No. It is a separate contribution for eligible enrolled employees. The initial employer rate is 1.5% of qualifying earnings, subject to the scheme rules and cap.
