PRSA vs Occupational Pension in Ireland — The Honest Comparison

When you change jobs, start working for yourself, or join an employer that offers you a choice, you will often face a decision between a PRSA (Personal Retirement Savings Account) and an occupational pension scheme. They both get the same income tax relief. They both grow tax-free inside the fund. But they work quite differently — and for many people, the distinction has a meaningful impact on charges, flexibility, and what happens when they change jobs.

This guide breaks down the honest differences, reflects the 2022 Pensions Act changes that shifted the landscape, and helps you think through which vehicle makes more sense for your situation.

What Is an Occupational Pension?

An occupational pension scheme (also called a company pension or employer pension) is set up by your employer. Contributions are made by you, often by your employer, or both. The scheme is managed by trustees under Pensions Authority oversight.

Occupational schemes come in two main types:

• Defined Benefit (DB): your pension is based on a formula — typically final salary and years of service. Common in the public sector and some older private schemes. The employer bears the investment risk.
• Defined Contribution (DC): your pension pot is built from contributions and investment returns. The most common type in private sector employment today. You bear the investment risk.

Most of what this guide covers applies to DC occupational schemes, since DB schemes are increasingly rare in the private sector and the comparison with a PRSA is most relevant for DC members.

What Is a PRSA?

A PRSA is a personal retirement savings vehicle that you own directly — not your employer. It is regulated by the Pensions Authority and must be offered by a Pensions Authority approved provider. There are two types:

• Standard PRSA: charges are capped by law at 1% annual management charge (AMC) and 5% contribution charge. Fund choice is limited to non-complex assets.
• Non-Standard PRSA: no charge cap; wider fund range including alternative assets and more complex investments.

Both types receive the same income tax relief at your marginal rate, subject to the age-related limits (capped contributions as a percentage of earnings up to €115,000).

Side-by-Side Comparison

Feature	Occupational Pension (DC)	PRSA
Portability	Not portable while employed. On leaving: Personal Retirement Bond (PRB) or transfer.	Fully portable. The PRSA belongs to you regardless of employer.
Employer contributions	Common; often matched (e.g. employer matches your 5% up to a cap).	Employer can contribute; legally permitted but less common in practice.
Vesting of employer contributions	2 years maximum vesting period (post-2022 Pensions Act). Employer contributions vest after 2 years of service.	No vesting period — employer contributions vest immediately.
Charges	Varies widely. Large employer schemes often have very low charges (0.3%–0.6% AMC). Smaller schemes may be higher.	Standard PRSA: capped at 1% AMC + 5% contribution. Non-standard: no cap; negotiate carefully.
Fund choice	Limited to whatever funds the scheme trustee has selected (often 5–15 options).	Wider range on non-standard PRSAs. Standard PRSAs limited to lower-complexity assets.
Access before retirement	Generally only on leaving employment or at retirement age (usually 60+).	Vested PRSA from age 50 — can access without leaving employment (post Finance Act 2023).
On leaving employer	Benefits transferred to PRB, deferred in scheme, or transferred to new employer scheme.	PRSA stays with you — continue contributing or leave to grow.
Consolidation	Old pots from previous employers become PRBs; can accumulate multiple PRBs over a career.	One PRSA can consolidate multiple employer periods — fewer pots to manage.
Contribution limits	Age-related limits as % of earnings (same structure). Employer contributions do not count against your personal limit.	Age-related personal limits apply. Employer contributions count against the overall PRSA limit for the year.

The 2022 Pensions Act — What Changed

The Pensions Act 2022 made significant changes that affect this comparison:

Vesting reduced to 2 years

Previously, many occupational schemes had vesting periods of up to 5 years — meaning you had to work for the employer for 5 years before you were entitled to keep the employer’s contributions if you left. The 2022 Act reduced this to a maximum of 2 years. If you leave after 2 years, you are entitled to the employer contributions that have accumulated to that point.

This significantly weakens one of the arguments in favour of PRSAs for people who move jobs, since the PRSA’s “immediate vesting” advantage is less dramatic when the alternative is only a 2-year wait.

Auto-Enrolment (My Future Fund)

The new auto-enrolment scheme — My Future Fund — is neither a PRSA nor a traditional occupational pension. It is a separate centrally administered scheme for workers who are not already in a qualifying occupational pension. If your employer does not offer an occupational scheme, auto-enrolment will apply from 2025 onwards (subject to phased rollout). Employers can, however, offer a PRSA as their vehicle for meeting auto-enrolment obligations in some circumstances. See our auto-enrolment guide for the full picture.

When a PRSA Makes More Sense

A PRSA is likely the better choice when:

• You change jobs frequently. Every time you leave an occupational scheme, you typically end up with a Personal Retirement Bond (PRB/buyout bond) sitting with an insurer, often at higher charges. A PRSA that travels with you avoids this fragmentation.
• Your employer does not offer an occupational scheme. A PRSA is often the only option available, particularly for self-employed people and those in smaller businesses. See our self-employed pension guide for more on this.
• You want to consolidate existing pension pots. A PRSA can receive transfers from old PRBs and other schemes, keeping everything in one place.
• You want early access from age 50. The Vested PRSA rules (Finance Act 2023) allow a PRSA to be accessed as a Vested PRSA from age 50 without leaving employment. This is a meaningful flexibility advantage over most occupational schemes.
• Your employer’s occupational scheme has high charges. If your employer’s scheme is expensive (common in smaller employer arrangements), a Standard PRSA with its charge cap may deliver better long-run outcomes.

When an Occupational Pension Makes More Sense

An occupational pension is likely the better choice when:

• Your employer offers meaningful matching. If your employer matches your contributions up to a significant percentage of salary — and they only do this through the occupational scheme, not a PRSA — leaving money on the table by opting out is almost never the right call. Employer match is the best return you will ever get on a pension contribution.
• You are in a Defined Benefit scheme. DB pensions are rare and valuable. The employer bears investment risk; you receive a guaranteed income in retirement based on salary and service. If you have access to a DB scheme, the PRSA comparison is largely irrelevant — stay in the DB scheme unless there is a very specific reason not to.
• The occupational scheme has very low charges. Large employer schemes — particularly in the public sector and major corporates — often negotiate AMCs of 0.3% to 0.5%. This is lower than most Standard PRSAs and far lower than many non-standard PRSAs. Charges matter enormously over a 30-year horizon.
• You intend to stay with your employer long-term. If you plan to stay for 10–20 years, the portability advantage of a PRSA is less relevant. A stable employer scheme with low charges and good employer contributions is a strong offering.

Personal Retirement Bonds — The Legacy Problem

If you have changed jobs more than once, you may have built up a collection of Personal Retirement Bonds (PRBs) — sometimes called buyout bonds — from old occupational schemes. These are individual insurance contracts that hold the value of your benefits from a scheme you left. Problems with PRBs:

• They tend to have higher charges than the original scheme
• They are often passively managed in a default fund with no ongoing review
• People forget they exist — particularly after several job changes
• They cannot receive new contributions

If you have PRBs sitting unattended, consolidating them into an active PRSA (or a new occupational scheme, if your current employer permits transfers in) is often worth doing — both for charge management and for keeping your retirement planning visible in one place. See our guide to tracing lost pensions if you have pots you cannot locate.

What About My Future Fund (Auto-Enrolment)?

My Future Fund, Ireland’s new auto-enrolment scheme, is a separate structure managed by a central authority. It is not a PRSA and not a traditional occupational pension. Workers who are not already in a qualifying pension scheme will be enrolled automatically, with contributions phased in from 2025. Existing PRSA or occupational scheme members are generally exempt from auto-enrolment. This is an evolving area — check the auto-enrolment page for current rules.