Merry Mullen

2026 Budget Summary - headline items announced includ:

Taxation & Income

· No changes to income tax bands, meaning higher earners may pay more tax
· USC 2% band ceiling raised to €28,700
· CGT Entrepreneur relief cap increased from €1 million to €1.5 million
· SARP extended for five years, with min qualifying income upped to €125,000
· FED extended to 2032
· The tax rate of Irish and equivalent offshore funds will be reduced from 41% to 38%
· Minimum wage rises by €0.65 to €14.15/hour

VAT & Business Support

· VAT for food and catering businesses cut to 9% from July 2026
· R&D tax credit increased from 30% to 35%, with a higher threshold
· Digital Games Tax Credit extended to 2031 (now includes post-release content)

Climate & Energy

· €5,000 VRT relief on electric vehicles extended to end of 2026
· A new category for zero emission cars to be created
· The €10,000 reduction in original market value for BIK purposes will reduce gradually and to be phased out by 2029
· 9% VAT rate on gas and electricity extended to end of 2030
· €400 income disregard for household microgeneration extended to 2028

Housing & Property

· €5 billion capital investment in housing, plus €200 million for Home Building Finance Ireland
· VAT on apartment sales cut from 13.5% to 9% until December 2030 to boost construction
· Residential Zoned Land Tax open for exemptions in 2026
· Living City initiative extended to 2030, adding towns like Athlone and Sligo
· New derelict property tax to be introduced at a minimum rate of 7%

Renters & Landlords

· Renters tax credit extended to end of 2028
· Mortgage interest relief extended for two years, with reduced rate in final year
· Three-year extension for income tax deduction for landlords retrofitting properties

For more details, please email: [email protected]

Please find attached a copy of our Budget 2025 Summary outlining some of the headline items as announced on Tuesday 1 October 2024.

An increase of –
€2,000 to the standard rate tax band from €42,000 to €44,000 (for a single person)
€125 to the personal tax credit, employee tax credit and earned income credit
€150 to the home carer tax credit and the single parent child credit
€300 to the incapacitated child credit and the blind persons tax credit
€250 in the rent tax credit for single individuals and €500 for jointly assessed couples


The 4.0% USC rate is reduced to 3% and the bands have also been widened in line with increases in the minimum wage.

The Help-To-Buy Scheme is extended from the end of 2025 to the end of 2029

The Mortgage Interest Tax Credit will be extended for one further year.

An increase in the annual limit for the Small Benefit Exemption to €1,500 and allowing employers to provide up to 5 non-cash benefits per year.

The VAT Registration thresholds will be increased to €85,000 for goods and €42,500 for services

The CAT Thresholds will be increased as follows:

Group A – from €335,000 to €400,000
Group B – from €32,500 to €40,000
Group C – from €16,250 to €20,000

A 6% rate of stamp duty for residential property purchases above €1.5m (effective from 2 October 2024). Existing rates of 1% (first €1m) and 2% (next €500k) remain.

An energy credit of €250 per household (paid in two instalments pre/post year-end)

Various increases to Social Welfare Payments (including but not limited to)
€12 increase in most weekly payments from January 2025
Double payment of child benefit to be paid in November and December 2024
Hot school meals to be extended to all primary schools in 2025 (from April onwards)
Free Travel Scheme Companion Pass for all those aged over 70 from September 2025
Various cost of living lump sum payments (in November) as well as the traditional Christmas bonus


Should you have any queries regarding any aspect of the measures announced and what it means for your business, please feel free to contact a member of our team.