# Payroll in Ireland: employer costs, taxes and compliance

> Machine-readable page from Payroll Overview (https://payrolloverview.com/), the independent index of global payroll providers.
> Canonical page: https://payrolloverview.com/countries/ireland/
> Methodology: every figure carries a source and a date in our database; ratings are averages of third-party platforms (https://payrolloverview.com/methodology/).
> Disclosure: Payroll Overview is free to use. We may earn a referral fee from some providers; this never affects inclusion or order (https://payrolloverview.com/disclosure/).
> Data updated: February 2026
> Every figure below carries its statutory source and year.

Running payroll in Ireland means handling a monthly cycle of salary payments, income tax withholdings, and social insurance contributions for both the employee and the employer. You collect tax at source on behalf of your worker, add your own employer contributions on top of gross pay, and file everything with the Irish tax authority. There is no annual reckoning to wait for, it all moves in real time each pay period.
This guide covers what an employee actually costs beyond their gross salary, how the pay cycle works in practice, the leave entitlements that create accrual obligations, and the notice and severance rules that land in final pay. The tables on this page carry the exact rates and statutory figures.

## Employer costs & taxes

| Item | Value | Source |
|---|---|---|
| Employer social security (on top of gross salary) | 11.2% | OECD (2025) |
| Employee social security (withheld from pay) | 4.1% | OECD (2025) |
| Total tax wedge (taxes as share of labor cost) | 32.6% | OECD (2025) |
| Corporate tax rate | 12.5% | OECD (2025) |

## Pay & payroll operations

| Item | Value | Source |
|---|---|---|
| 13th-month salary | none | National government (2026) |
| Minimum wage (per month) | €2,391 | Eurostat (2026) |
| Average wage (per year) | 60,431 | OECD (2024) |

## Leave & time off

| Item | Value | Source |
|---|---|---|
| Paid annual leave | 20 days | National government (2026) |
| Public holidays | 10 days | National government (2026) |
| Maternity leave | 26 weeks | OECD Family Database (2024) |
| Paternity leave | 11 weeks | World Bank Women, Business and the Law (2026) |
| Parental leave | 9 weeks | OECD Family Database (2024) |

## Termination

| Item | Value | Source |
|---|---|---|
| Notice period | 3.7 weeks | World Bank Employing Workers / B-READY (2019) |
| Severance pay (at 1 year tenure) | 10.7 weeks | World Bank Employing Workers / B-READY (2019) |
| Employment protection (OECD EPL, scale 0-6) | 2.1 | OECD (2019) |

## Labor market context

| Item | Value | Source |
|---|---|---|
| Retirement age | 66 | OECD Pensions at a Glance (2024) |
| Unemployment rate | 4.4% | OECD (2025) |
| GDP per capita | $112,895 | World Bank Open Data (2024) |
| Union density | 22.2% | OECD/AIAS ICTWSS (2024) |
| Collective bargaining coverage | 34% | OECD/AIAS ICTWSS (2017) |

## Worked example: total employer cost

| Line | Annual |
|---|---|
| Gross annual salary | 60,000 |
| Employer contributions (about 11%) | + 6,705 |
| Total employer cost | 66,705 |

Rounded from the average wage, before benefits, allowances or provider fees.

The gap between what an employee earns and what they cost you is where most employers get a surprise. On top of every euro of gross salary, you owe employer social insurance contributions, and that adds roughly one tenth again to your payroll bill. It is not as heavy as some countries, but it is real money and it compounds quickly across a team. See the table below for the precise rate.
The overall tax wedge, meaning the share of total labour cost that goes to tax and social contributions rather than the worker's pocket, sits at around a third. In plain terms, for every three euros you spend on an employee, about one euro goes to the state between your contributions and theirs. That is a useful mental model when budgeting headcount.

Most Irish employers pay monthly, though weekly and fortnightly cycles are common in sectors with hourly workers. There is no statutory thirteenth-month payment in Ireland, so you do not need to budget for a mandatory bonus salary at year end. The minimum wage floor is set at a monthly level, and as of 2026 it sits at €2,391 per month, so any fixed salary needs to clear that bar before you hire.

Employees in Ireland are entitled to 20 days of annual leave per year, plus 10 public holidays, and you need to account for those accruals in your payroll system from day one. Holiday pay is a real cost, not just a scheduling issue. On the termination side, notice and severance both translate into cash items in the final pay run. Notice sits at just under four weeks and severance at around ten and a half weeks, so exiting an employee is not cheap. Build those figures into your headcount cost modelling well before you ever need to act on them.

If you do not already have a legal entity in Ireland, you will need one before you can hire directly, and setting that up takes time and ongoing administrative effort. Even with an entity in place, keeping up with contribution rate changes, leave rule updates, and local filing requirements is a real operational load. A global payroll provider or employer of record can take that off your plate, handling the filings, keeping rates current, and making sure final pay calculations are correct when someone leaves. It tends to make the most sense when you have a small team in Ireland, or when you are testing the market and do not want to commit to a full local setup yet.