On the 30th of September 2025, Ireland will take a major step in transforming its pensions landscape with the launch of My Future Fund, the country’s first Automatic Enrolment (AE) retirement savings system. Designed to boost retirement savings for hundreds of thousands of workers, this initiative will be overseen by the newly established National Automatic Enrolment Retirement Savings Authority (NAERSA).

With approximately 800,000 employees expected to be enrolled via payroll software, it’s crucial that accountants and payroll professionals are fully up to speed on how the system works.

What is Auto Enrolment?

Auto Enrolment is a mandatory workplace pension savings system for employees who are not currently saving for retirement. Under this system, eligible employees will be automatically signed up to contribute a portion of their salary into a pension fund, My Future Fund, which will be administered by NAERSA.

The goal is simple: increase retirement savings coverage across Ireland, especially for lower and middle-income workers who may not have access to an occupational pension.

Why Is It Being Introduced?

Ireland has long struggled with low pension participation rates among private sector workers. Many people either lack access to a pension through their employer or choose not to join one. Auto Enrolment is being introduced to address this gap and ensure that workers can build a more secure retirement income.

Research from the ESRI highlights that 75% of AE participants are likely to earn incomes that place them in the standard tax band or outside the tax net entirely. Traditional tax relief has offered little benefit to this cohort, prompting the shift to a top-up model instead of the usual tax relief approach.

Who Will Be Automatically Enrolled?

Employees will be automatically enrolled if they meet the following criteria:

• Aged between 23 and 60
• Earning over €20,000 per year
• Not already contributing to a pension scheme

Once enrolled, contributions will be automatically deducted from their salary through the employer’s payroll system.

How Will It Work?

The My Future Fund system will operate as follows:

• Employee Contributions: Deducted via payroll. Instead of tax relief, the State will contribute €1 for every €3 the employee puts in.
• Employer Contributions: Employers will match the employee’s contributions.
• Administration: Employers will not manage opt-outs or suspensions. All changes will be handled directly by NAERSA, which will notify employers through updated payroll notifications (AEPN).

Opting Out or Suspending Contributions

While participation starts automatically, employees can choose to opt out or pause their contributions under the following conditions:

• Opting Out:
• Only allowed in months 7 and 8 after initial enrolment.
• Employees receive a refund of their contributions, but employer and State contributions remain in the pension pot.
• The same opt-out window applies when contribution rates increase.
• Suspending Contributions:
• Allowed after the initial 6-month period.
• Suspension lasts a minimum of 1 year, up to a maximum of 2 years.
• No refunds are given; contributions simply pause.
• Employer and State contributions are also paused.

After two years, employees who opted out or suspended will be automatically re-enrolled if they still meet the eligibility criteria. They’ll again have the opportunity to opt out or suspend after 6 months.

Final Thoughts for Accountants and SMEs

As trusted advisors to many SMEs, accountants will play a pivotal role in helping businesses prepare for Auto Enrolment. Although NAERSA will manage most administrative functions, payroll systems must be ready to support enrolment, contribution deductions, and real-time updates from AEPN notifications.

Understanding My Future Fund inside and out will be essential to guiding clients through this transformative shift and ensuring smooth compliance.

For more, Róisín Nolan and Lisa Phillips of the Automatic Enrolment Programme Management Office explains more in this session.

In this course, the following topics are covered:

• Overview of auto-enrolment
• Eligibility criteria
• Contribution rates
• Explanation of the process
• What it means for employees and employers

The contents of this article are meant as a guide only and are not a substitute for professional advice. The author/s accept no responsibility for any action taken, or refrained from, as a result of the material contained in this document. Specific advice should be obtained before acting or refraining from acting, in connection with the matters dealt with in this article. The information at the time of publishing was accurate and could be subject to final changes.