PRSA vs company pension in Ireland: which is better in 2026?

The rules on PRSAs changed substantially in 2023 and again in 2025, and a lot of what people believe about them is now out of date. Here is where things stand, and how to decide which suits you.

What each one is

A PRSA, a Personal Retirement Savings Account, is a pension contract between you and a provider. It is in your name, you choose the provider, and it comes with you when you change jobs. Your employer can contribute to it, but does not have to.

A company pension is an occupational scheme set up by your employer. Since the pension reforms of recent years, most are now run through a master trust, a large scheme operated by a provider on behalf of many employers, with a professional trustee board. The employer decides the contribution rates and the scheme rules.

Contributions and tax relief

On your own contributions, the tax relief is the same for both. You get relief at your marginal rate, 20% or 40%, on contributions up to an age-related percentage of your earnings: 15% under 30, 20% from 30 to 39, 25% from 40 to 49, 30% from 50 to 54, 35% from 55 to 59 and 40% at 60 and over, on earnings up to €115,000 a year. Those limits cover all your pension contributions combined, so if you have both a PRSA and a company pension, they share the allowance.

On employer contributions, the rules used to favour company schemes heavily. That changed. Since 1 January 2023, an employer contribution to your PRSA is no longer taxed as a benefit in kind, and it does not use up your own age-related allowance. This opened the door to very large employer PRSA contributions, particularly for company directors, so from 1 January 2025 a cap was introduced: employer PRSA contributions are limited to 100% of your salary from that employment in the year. Anything above that is treated as a benefit in kind.

For an employee whose employer offers a company scheme, the practical point is this: if the employer contributes, join. An employer contribution is money you do not otherwise get, and it is the single biggest factor in how large your pension will be.

Charges

Standard PRSAs have charges capped by law: no more than 5% of each contribution and no more than 1% a year of the fund. Non-standard PRSAs can charge more and offer wider fund choices. Company scheme charges are set by the employer's arrangement with the provider and are often lower than 1% on larger schemes, but not always. Ask for the figure in writing in both cases.

Access and flexibility

You can normally take benefits from a PRSA from age 60, or from 50 if you have left the employment that contributed to it. You must draw down by 75. At retirement you can take 25% as a lump sum (the first €200,000 tax free) and put the balance into an ARF, buy an annuity, or leave it in the PRSA as a vested PRSA.

Company schemes have a normal retirement age set by the scheme, usually between 60 and 70, and you can access benefits from 50 if you have left the employer. The lump sum options are similar, though some schemes calculate the tax-free lump sum on salary and service rather than as 25% of the fund, which can be better or worse depending on your circumstances.

Governance and protection

A company pension has trustees who are legally responsible for running it in members' interests. A PRSA has no trustees; you deal with the provider directly and the Pensions Authority regulates the product. Neither is inherently safer. A master trust with a professional trustee board and a standard PRSA with a large provider are both well-regulated homes for your money.

Which is better for you

If you are an employee and your employer offers a company scheme with an employer contribution, join it and contribute at least enough to get the full employer match. Use a PRSA on top if you want to contribute more or hold a previous pension separately.

If your employer offers nothing, a PRSA is the straightforward choice. Your employer must at least give you access to a PRSA and deduct contributions through payroll if you ask.

If you are self-employed, a PRSA or a personal pension are your options. They work similarly; a PRSA is more portable and has the charge cap.

If you are a company director, the 2023 and 2025 changes make the PRSA a serious alternative to an executive pension, particularly if you want the company to fund your pension heavily in some years and not others. The 100% of salary cap needs to be planned around. This is one of the areas where advice pays for itself many times over, and I have written about it in the context of business owner planning.

The MyFutureFund factor

Ireland's auto-enrolment scheme started on 1 January 2026. If you are between 23 and 60, earn over €20,000 and are not in a pension through payroll, you will be enrolled automatically. MyFutureFund is neither a PRSA nor a company scheme in the usual sense, and it does not allow additional voluntary contributions or use the age-related tax relief system. For higher-rate taxpayers a company scheme or PRSA usually gives more relief. If you have been auto-enrolled and are unsure whether to stay in, that is worth a conversation.

Get in touch if you want to know which structure suits your situation, and what your employer is required to offer you.