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Budget 2026
6th October 2025
Last Updated: 6th October 2025
Please note that implementation dates for announced changes have been indicated below where available. Not all changes take immediate effect.
We will endeavour to update this with any major changes or announcements as we digest the budget this year.
Personal Taxation
- Minimum wage to increase to €14.15 from 1st January 2026. 2% USC rate band increases by €1,318 in line with minimum wage increase.
- Rent tax credit extended to 31 December 2028
- Mortgage interest tax credit extended until 31 December 2026. The maximum tax credit will remain at €1,250 for 2025, but decreases to €625 for 2026
- Micro-generation of electricity – income tax relief of €400 per individual annually, extended until 31 December 2028
Cost of Living Update & Supports
- 9% VAT rate for supply of gas and electricity extended to 31 December 2030
- 9% VAT rate (instead of 13.5%) will be applied to the sale of new apartments from 8th October 2025 to 31 December 2030
- 9% VAT rate on food, catering and hairdressing from 1st July 2026
- €500 permanent reduction to the student tuition contribution fees for 2025/2026 academic year
Business Taxation & Regulation
- Extend BIK relief of €10,000 for certain categories of electric vehicles on a tapered basis, until 31 December 2028 (€5,000 in 2027 then 2,500 in 2028)
- A new band for EVs for BIK calculations is to be introduced – More details to follow when known
Relevant Contracts Tax and Construction Industry
- No changes noted
Indirect Taxes
- Farmers flat rate – decreased from 5.1% to 4.5% from 1st January 2026
- Carbon tax – increase will be applied to auto fuels from 8th October 2025 and all other fuels on 1 May 2026
Stamp duty
- No changes noted
Capital Taxes
- No changes noted:
- Category A Threshold remains €400,000
- Category B Threshold remains €40,000
- Category C Threshold remains €20,000
(Local) Property Tax (LPT)
- No changes noted. Property revaluations are already in progress for 2026 to 2030 (LPT returns due by 7 November 2025)
Miscellaneous Provisions & Announcements
- Tobacco – excise duty increase of €0.50 on a pack of 20 cigarettes
- €10 increase in weekly social protection payments
- Working Family Payment income thresholds increase by €60 per week for all families
- Increase in Carer’s Allowance income disregard of €375 to €1,000 for a single person, or +€750 to €2,000 for a couple
- €3m in additional support to establish League of Ireland football academies
- €1.6m increased funding to intercounty GAA players
- Derelict Property Tax (DPT) to replace Derelict Sites Levy
- Revised Entrepreneur Relief: Lifetime limit increased to €1.5m (from €1.0m) from 1 January 2026; rate remains 10% on qualifying disposals.
Summary Statistics:
| Budget 2026 | Budget 2025 | ||
| Capital Gains Tax Rate | 33% | 33% | |
| Capital Acquisitions Tax Rate | 33% | 33% | |
| Income Tax Rates | |||
| Lower | 20% | 20% | |
| Higher | 40% | 40% | |
| DIRT Tax | |||
| 39% (39% – where payments made less frequently than annually) | 39% (39% – where payments made less frequently than annually) | ||
| Tax Credits | |||
| Single Person | €2,000 | €2,000 | |
| Married Couple | €4,000 | €4,000 | |
| PAYE Credit | €2,000 | €2,000 | |
| Home Carer Credit | €1,950 | €1,950 | |
| Earned Income Tax Credit | €2,000 | €2,000 | |
| Rate Bands | |||
| Single/widowed | €44,000 | €44,000 | |
| Single/widowed with dependent children | €48,000 | €46,000 | |
| Married -one income earner | €53,000 | €53,000 | |
| Married – two income earners | €88,000 | €88,000 | |
| PRSI | |||
| Contribution Ceiling | No limit | No limit | |
| Universal Social Charge | |||
| < €13,000 | Exempt | Exempt | |
| € 0 – €12,012 | 0.5% | 0.5% | |
| €12,013 – €28,700 | 2% | ||
| €12,013 – €27,382 | 2% | ||
| €28,701 – €70,044 | 3% | ||
| €27,383 – €70,044 | 3% | ||
| €70,044 – €100,000 | 8% | 8% | |
| Self employed income > €100,000 | 11% | 11% | |
| PAYE income in excess of €100,000 | 8% | 8% | |
| Age >70/medical card holders with income < €60,000 – Max rate | 2.0% | 2.0% |
Whilst every care has been taken in the production of this budget summary, neither Royal Canal Financial Control Services nor Ronan Duffy and Co. can be held responsible for any action taken or deferred, resulting from any errors contained therein. For a more comprehensive summary please refer to the government press release.