The Department of Social Protection has confirmed that new PRSI contribution rates will come into effect from 1 October 2025. These changes are part of a broader plan to secure Ireland’s Social Insurance Fund and protect future State Pension and social welfare payments. 

From October, both employee and employer PRSI rates will increase by 0.1% across most classes and subclasses. Self-employed PRSI contributions will also rise from 4.1% to 4.2%. Employees earning €352 or less per week will remain exempt from PRSI, so this change mainly affects middle and higher-income earners. 

Although the increase is small, it forms part of a multi-year schedule of PRSI rate rises running from 2024 to 2028. Two further increases of 0.1% are planned for 2026 and 2027, followed by a 0.2% increase in 2028. These gradual adjustments are designed to spread the cost and give businesses time to plan while ensuring the State can continue funding essential benefits. 

What Employers Should Do

Employers should ensure their payroll systems are ready to apply the updated rates from October. Most payroll software will update automatically, but it is worth checking with your provider. 

It can also help to notify staff about the changes in advance so they are not surprised by a slightly higher PRSI deduction on their payslips. 

Need Assistance?

If you have questions about the upcoming PRSI changes or need help updating your payroll, contact our team at Easy Payroll. We are here to guide you through the updates and make sure your payroll stays accurate and compliant.