Pension changes in 2026: everything you need to know 

Understanding the various changes to pensions in 2026, whether it’s a personal, occupational, or State pension, can be difficult. With this guide, we want to make it easy for you to understand what is changing and what it means to you.  

Zurich has been meeting the financial needs of people in Ireland for over 40 years. Our award-winning₁ investment team, in Dublin, is responsible for funds under management of approximately €44.8 billion, of which pension assets amount to €38.3 billion₂.  

Table of contents:  

1. Contributory State pension increase
2. My Future Fund launch
3. Standard Fund Threshold (SFT) increase
4. Pay Related Social Insurance (PRSI) contribution increases  

Contributory State pension increase

From 1^st January 2026, the State pension (contributory) personal rate will increase by €10 per week from €289.30 to €299.30 per week (assuming at least 2080 full rate contributions were made to obtain the maximum rate)₃. Ancillary social welfare rates were also increased in Budget 2026.  

Since 1^st January 2024, people born after 1^st January 1958 can choose when they would like to begin receiving their State pension (contributory) at any age between 66 and 70. For people born before 1st January 1958, the State pension age remains 66. This change was highlighted in a previous article we wrote about how the State pension is becoming more flexible.  

In essence, these changes aim to provide people with more choices and potentially increase their State pension payments when they retire. It also means that for people who started working later in life, they will now be able to work longer in order to qualify for the State pension.  

This table shows the increase in the State pension (contributory) in 2026 and the rate payable depending on the age of the recipient₄.

State pension (contributory) maximum weekly rates in 2026:

The table below shows the contributory pension increases between in 2026₅

My Future Fund launch (Auto-enrolment)  

On 1st January 2026, employees will be automatically enrolled into the new pension system - auto-enrolment (AE).  

The My Future Fund auto-enrolment scheme will mandate enrolment for employees aged 23–60 earning over €20,000 if not already in an employer pension plan.  

The Finance Bill included some changes for how tax works on some aspects of the auto-enrolment (AE) retirement savings scheme:

• AE scheme providers will no longer have to pay investment undertaking tax.   
• Employer contributions to AE will be exempt from Universal Social Charge (USC).   

These changes aim to make the AE scheme fairer and more beneficial for everyone involved.   

Employee and employer contributions start at 1.5% of gross earnings, with a further 0.5% State top-up; these rates will increase over the next decade, reaching a total 14%.  

Opt-outs are only permitted in designated windows after initial enrolment or after contribution increases.  

• If you are an employee visit our auto enrolment for employees page to learn more.
• If you are an employer visit our auto enrolment for employers page to learn more.  

Standard Fund Threshold increase 2026  

From 1st January 2026 the Standard Fund Threshold (SFT) is going up. It will increase by €200,000 each year from 2026 to 2029, reaching €2.8 million by 2029.   

So, what is the SFT?  It’s the maximum value of tax-relieved pension benefits you can take out in your lifetime from all your pension plans. If you go over this limit, you’ll face an additional tax on the amount over the SFT.

Right now, the current limit on SFT is €2 million. This limit has been in place since 2014.  In September 2024, the government announced that the SFT would increase starting in 2026. This is good news for pension savers with larger funds.   

Gerard Tyrrell, Pension Consultant at Zurich, explains: “The Standard Fund Threshold is the maximum tax-efficient pension fund you can build up in Ireland. If your pension assets go over the SFT, a 40% tax called ‘chargeable excess tax’ applies straight away to the amount over the limit.”   

He adds: “The SFT hasn’t changed since 2014, even though the cost of living and wages have gone up. That’s why there have been calls to review it.”   

PRSI contribution increases  

The PRSI (Pay Related Social Insurance) contribution is set to increase in Ireland in 2026. In October 2025 they rose by 0.1% and will rise again later in 2026. This means that by 2026, employees, employers, and self-employed individuals will be paying higher PRSI contributions₆.

So, what does this mean for you?

• If you work in Ireland, your PRSI deductions from your salary will increase.
• Employers will also pay higher PRSI on wages.
• The change aims to support the sustainability of Ireland’s Social Insurance Fund, which finances state pensions and other social welfare benefits.

As part of the Governments PRSI roadmap, there will be incremental increases in all classes of PRSI (employer, employee and self-employed) over the coming years₇. They are as follows:

• 2025: 0.1%
• 2026: 0.15%
• 2027: 0.15%
• 2028: 0.2%

For more information and changes introduced in Budget 2026 you can read our article that looks at some of the changes and updates to pensions, auto-enrolment, savings and tax. 

The information contained herein is based on Zurich Life’s understanding of current Revenue and Dept of Social Protection practice as at December 2025 and may change in the future.

Sources: 
₁Investment Excellence Award, Brokers Ireland, 2014 - 2025. No awards held in 2020. Pension Provider Excellence Award, Brokers Ireland, 2021 – 2025. Fund Management Company of the Year 2025 Award, Business and Finance Financial Services Awards. Pensions and Life Assurance Company of the Year, InBUSINESS Recognition Awards, 2025. 
₂Zurich as at 30th September 2025. 

₃Gov.ie: Social welfare increases   

₄Citizens Information: Applying for the State Pension 

₅Citizens Information: Social welfare rates announced in Budget 2026 

₆Citizens Information: Paying social insurance (PRSI)

₇Gov.ie: Government PRSI increases