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Budget Summaries

Budget 2019

9 October 2018

Last Updated: 9 October 2018

Please note that implementation dates for announced changes have been indicated below where available. Not all changes take immediate effect.

Personal Taxation (from 1st January 2019)
• Home carer tax credit increased from €1,200 to €1,500
• PRSI higher rate threshold increased from €376 to €386 per week
• REMINDER: The government had previously announced an increase in the minimum wage to €9.80 per hour from January 2019

Business Taxation & Regulation
• Earned income tax credit increased from €1,150 to €1,350
• Residential property loan interest deduction for landlords increased to 100% from 1st January 2019
• Corporation tax start-up relief (3 year tax exemption for new ventures) extended until the end of 2021
• Employer’s PRSI rate increase 0.1% in 2019, and expected to increase again in 2020 by 0.1%

Relevant Contracts Tax and Construction Industry
• No changes noted

Indirect Taxes
• VAT on tourism activities & hairdressing increased from 9% to 13.5% from 1st January 2019. Newspapers and sports facilities will retain the 9% rate.

• VAT on e-books and electronically supplied newspapers reduced from 23% to 9% from 1st January 2019.

Stamp duty
• Extension of Young Trained Farmers stamp duty relief extended until 31st December 2021

Carbon Tax
• No changes

Capital Taxes
• Increase in the Group A Threshold from €310,000 to €320,000 for gifts/inheritances received on or after 10th October 2018.

(Local) Property Tax (LPT)
• Review Group’s report will be published in due course. Any future changes in LPT will be moderate and affordable.

Miscellaneous Provisions & Announcements
• Excise duty on cigarettes increased by 50c from 9th October 2018
• Betting duty increased from 1% to 2%
• Extension of 0% BIK rate for electric vehicles for 3 years, and extension of VRT relief on hybrid vehicles until the end of 2019
• €5 increase in all social welfare weekly payments from next March, and full Christmas bonus this year
• 50c reduction in prescription charges for all medical card holders over the age of 70
• DPS Scheme threshold decreased from €134 to €124
Summary Statistics

Budget 2019 Budget 2018
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 €1.650 €1,650
Married Couple €3,300 €3,300
PAYE Credit €1,650 €1,650
Earned Income Tax Credit €1,350 €1,150
Rate Bands
Single/widowed €35,300 €34,550
Single/widowed with dependent children €39,300 €38,550
Married -one income earner €44,300 €43,550
Married – two income earners €70,600 €69,100
PRSI
Contribution Ceiling No limit No limit
Universal Social Charge
< €13,000 Exempt Exempt
€ 0 – €12,012 0.5% 0.5%
€12,013 – €19,874 2.0%
€12,013 – €19,372 2.0%
€19,874 – €70,044 4.50%
€19,373 – €70,044 4.75%
€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% 2.5%

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.

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Budget 2018

10 October 2017

Last Updated: 10 October 2017

Please note that implementation dates for announced changes have been indicated below where available. Not all changes take immediate effect.

Personal Taxation
• Home carer credit increased from €1,100 to €1,200

• Benefit in Kind (BIK) on Electric Vehicles to be set to 0% for a period of 1 year, along with 0% BIK on electricity used in the workplace for charging vehicles.

• Pre-letting expenses incurred of up to €5,000 allowed as revenue expense for tax relief against rental income for properties vacant for 12 months or more.

•Plan to amalgamate USC and PRSI over the medium term

• REMINDER: The government had previously announced an increase in the minimum wage to €9.55 per hour from January 2018

Business Taxation & Regulation
• Earned Income Credit increased from €950 to €1,150

Relevant Contracts Tax and Construction Industry
• No changes noted

Indirect Taxes
• VAT refund scheme for Charities, to compensate for VAT incurred on inputs. Scheme to refund expenses incurred in 2018 in the next tax year

• Tourism rate of 9% to be retained

Stamp duty
• Rate of duty on non-residential property increased from 2% to 6%

Carbon Tax
• No changes noted

Capital Taxes
• Qualifying assets under the ‘7 year CGT relief’ scheme can now be sold between the fourth and seventh anniversaries of acquisition and still enjoy full CGT relief on any chargeable gains.

(Local) Property Tax
• No changes noted

Miscellaneous Provisions & Announcements
• Excise duty on cigarettes increased by 50c

•Sugar tax to be introduced on 1 April 2018

• Tapered residential mortgage interest relief (‘tax relief at source’) for home owners who took out qualifying mortgages between 2004 – 2012 over 3 years (2018: 75% of 2017 relief, 2018: 50% relief, 2019: 25% relief)

•Enhanced Revenue budget for PAYE Compliance interventions, in preparation for the PAYE Modernisation from 1 January 2019

• Brexit loan scheme to assist SMEs

Summary Statistics

Budget 2018 Budget 2017
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 €1.650 €1,650
Married Couple €3,300 €3,300
PAYE Credit €1,650 €1,650
Earned Income Tax Credit €1,150 €950
Rate Bands
Single/widowed €34,550 €33,800
Single/widowed with dependent children €38,550 TBC €37,800
Married -one income earner €43,550 €42,800
Married – two income earners €69,100 €67,600
PRSI
Contribution Ceiling No limit No limit
Universal Social Charge
< €13,000 Exempt Exempt
€ 0 – €12,012 0.5% [No change] 0.5%
€12,013 – €18,772 2.5%
€12,013 – €19,372 2.0%
€18,773 – €70,044 5%
€19,373 – €70,044 4.75%
€70,045 – €100,000 8% [No change] 8%
Self employed income > €100,000 11% [No change] 11%
PAYE income in excess of €100,000 8% 8%
Age >70/medical card holders with income < €60,000 – Max rate 2.0% 2.5%

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.

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Budget 2017

11 October 2016

Last Updated: 11 October 2016

Please note that implementation dates for announced changes have been indicated below where available. Not all changes take immediate effect.

Personal Taxation
• Increase in the home carer tax credit from €1,000 to €1,100
• Rent a room relief increased from €12,000 to €14,000
• Mortgage interest relief extended to 2020

Business Taxation & Regulation
• Earned Income Credit increased from €550 to €950
• Allowable interest deduction for rental of residential property increased from 75% to 80%.

Relevant Contracts Tax and Construction Industry
• The Home Renovation Incentive (HRI) Scheme is being extended until 31 December 2018.

Indirect Taxes
• The 9% VAT rate is being retained.
• Farmer’s flat rate addition increased from 5.2% to 5.4%

Stamp duty
• No changes noted

Carbon Tax
• Fuel inputs to create high efficiency electricity now exempt from carbon tax.

Capital Taxes
• Capital Acquisitions Tax: Tax free threshold which applies primarily to gifts and inheritances from parents to their children is being increased from €280,000 to €310,000.

(Local) Property Tax
• No changes noted

Miscellaneous Provisions & Announcements
• Excise duty increase on tobacco 50c per 20 pack.
• Income tax rebate to assist first time buyers fund 20% deposit required by the Central Bank.
• The DIRT rate will be decreased by 2% each year for the four years until it reaches 33%.
• State pension will rise by €5 per week from March 2017, along with other weekly social welfare payments
• Excise duty on alcohol, petrol and diesel remains unchanged
• Sugar tax to be introduced in April 2018

Summary Statistics

Budget 2017 Budget 2016
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) 41% (41% – where payments made less frequently than annually)
Tax Credits
Single Person €1.650 €1,650
Married Couple €3,300 €3,300
PAYE Credit €1,650 €1,650
Earned Income Tax Credit €950 €550
Rate Bands
Single/widowed €33,800 €33,800
Single/widowed with dependent children €37,800 €37,800
Married -one income earner €42,800 €42,800
Married – two income earners €67,600 €67,600
PRSI
Contribution Ceiling No limit No limit
Universal Social Charge
< €13,000 Exempt Exempt
€ 0 – €12,012 0.5% 1%
€12,013 – €18,772 2.5%
€12,013 – €18,668 3%
€18,773 – €70,044 5%
€18,669 – €70,044 5.5%
€70,045 – €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 2.5% 3%

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.

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Budget 2016

13 October 2015

Last Updated (bold type): 13 October 2015

Please note that implementation dates for announced changes have been indicated below where available. Not all changes take immediate effect.

Personal Taxation
• Increase in home carer tax credit to €1,000, with an increase in the income limit to €7,200.
• PRSI relief for income in excess of €352 weekly, up to weekly income of €424. Reducing sliding scale of relief as income increases above €352, with maximum relief of €12.

Business Taxation & Regulation
• Earned Income credit of €550 for self-employed traders and professionals, along with directors who are not entitled to the PAYE tax credit.
• From 1st January 2016, the statutory minimum wages will be €9.15 per hour
• Increase in the threshold for paying higher rate employer’s PRSI from €356.01 to €376.01.
• 3 Year Relief for Start-Up Companies is being extended
• Supporting retailers by incentivising electronic payments (see Stamp Duty below)
• Maximum rate of commercial motor tax reduced from €5,195 to €900

Relevant Contracts Tax and Construction Industry
• The Home Renovation Incentive (HRI) Scheme is being extended until 31 December 2016.

Indirect Taxes
• The 9% VAT rate has been retained.

Stamp duty
• With effect from 1st January 2016, the current €2.50/€5.00 per annum charge on ATM cards/combined ATM & Debit Cards is being replaced with a 12c ATM withdrawal fee, but capped at €2.50/€5.00 per annum per card

Carbon Tax
• No changes to note.

Capital Taxes
• Capital Acquisition Tax: Tax free threshold which applies primarily to gifts and inheritances from parents to their children is being increased from €225,000 to €280,000

(Local) Property Tax
• 2016 property revaluations postponed until 2019

Miscellaneous Provisions & Announcements
• Increased duty on a packet of 20 cigarettes 50 cent, with a pro-rata increase in all other tobacco products.
• Paternity benefit scheme to be introduced from September 2016
• €5 increase in child benefit
• Extension of free Pre-School Year from age 3 until aged 5.5 years/start primary school
• Extension of free GP care to children under 12 years
• €3 weekly increase in pension rates
• Respite care grant €1,700 in 2016
• Social welfare Christmas bonus increased to 75%
• Pension fund levy to end in 2015

Summary Statistics

Budget 2016 Budget 2015
Capital Gains Tax Rate 33% 33%
Capital Acquisitions Tax Rate 33% 33%
Income Tax Rates
Lower 20% 20%
Higher 40% 40%
DIRT Tax
41% (41% – where payments made less frequently than annually) 41% (41% – where payments made less frequently than annually)
Tax Credits
Single Person €1.650 €1,650
Married Couple €3,300 €3,300
PAYE Credit €1,650 €1,650
Earned Income Tax Credit €550 €0
Rate Bands
Single/widowed €33,800 €33,800
Single/widowed with dependent children €37,800 €37,800
Married -one income earner €42,800 €42,800
Married – two income earners €67,600 €67,600
PRSI
Contribution Ceiling No limit No limit
Universal Social Charge
< €13,000 Exempt
< €12,012 Exempt
€ 0 – €12,012 1% 1.5%
€12,013 – €18,668 3%
€12,013 – €17,576 3.5%
€18,669 – €70,044 5.5%
€17,577 – €70,044 7%
€70,045 – €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 3% 3.5%

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.

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Budget 2015

14 October 2014

Last Updated (bold type): 15 October 2014

Please note that implementation dates for announced changes have been indicated below where available. Not all changes take immediate effect.

Items marked TBC (To Be Confirmed) are attaching/related to taxation elements which were amended in Budget 2015. We await further details to confirm what changes, if any, apply to these related items.

Personal Taxation
• Artists’ Exemption increased by €10,000 to €50,000.
• Rent-A-Room Relief threshold increased to €12,000.
• Water charges tax credit of 20%, up to a maximum water charge of €500. Credit available in following year.

Business Taxation
• Corporation tax 3 year exemption extended to new businesses starting in 2015.
• 12.5% corporation tax rate being retained.

Relevant Contracts Tax and Construction Industry
• Home Renovation Scheme extended to rental properties where the landlord is subject to income tax.

Indirect Taxes
• Increase in Farmers’ Flat-Rate Addition from 5% to 5.2% from 1 January 2015.
• 9% VAT rate being retained.

Stamp duty
• No changes to note.

Carbon Tax
• No changes to note.

Capital Taxes
• Property purchases incentive (no capital gains tax if purchased property by 31st December 2014 and held for seven years) is not being extended.

(Local) Property Tax
• No changes to note

Miscellaneous Provisions & Announcements
• Extension of VRT relief on hybrid electric vehicles to 31 December 2016.
• Child benefit increased by €5 per child from 1 January 2015.
• Price of 20 pack cigarettes to increase by 40c from midnight (Other tobacco products pro-rata increase).
• 25% of Social Welfare Christmas Bonus restored.
• DIRT exemption on deposit funds for first time buyers, for private dwellings purchased from Budget night until 2017.
• No change in excise duty on old reliables – petrol/diesel, motor tax, VRT alcohol.

Summary Statistics

Budget 2015 Budget 2014
Capital Gains Tax Rate 33% 33%
Capital Acquisitions Tax Rate 33% 33%
Income Tax Rates
Lower 20% 20%
Higher 40% 41%
DIRT Tax
41% (41% – where payments made less frequently than annually) 41% (41% – where payments made less frequently than annually)
Tax Credits
Single Person €1,650 €1,650
Married Couple €3,300 €3,300
PAYE Credit €1,650 €1,650
Rate Bands
Single/widowed €33,800 €32,800
Single/widowed with dependent children €36,800 TBC €36,800
Married -one income earner €42,800 €41,800
Married – two income earners €67,600 €65,600
PRSI
Contribution Ceiling No limit No limit
Universal Social Charge
< €12,012 Exempt
< €10,036 Exempt
€ 0 – €12,012 1.5%
€ 0 – €10,036 2%
€12,013 – €17,576 3.5%
€10,037 – €16,016 4%
€17,577 – €70,044 7%
>€16,016 7%
€70,044 – €100,000 8%
Self-employed > €100,000 11% 10%
Age >70/medical card holders with income < €60,000 – Max rate 3.5% 4%
Age >70, income > €100,000 – Max rate TBC 7%

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.

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Budget 2014

15 October 2013

Last Updated (bold type): 7 November 2013

Please note that implementation dates for announced changes have been indicated below where available. Not all changes take immediate effect.

Personal Taxation
• No change in tax rates so no major changes in net pay. However, changes in medical insurance relief and one-parent family credits will affect some individuals.
• One-Parent Family Tax Credit – replaced by Single Person Tax Credit from 1st January 2014. Of same value but now only available to one ‘principal carer’.
• Tax relief on private medical insurance limited to first €1,000 per adult subscription and €500 per child. Please note this threshold relates to the gross premium payable. Medical insurance is usually quoted net of tax relief at 20%. The portion of the gross premium above €1,000 will not qualify for tax relief. Where renewals have already been issued/paid a balancing statement will need to be issued by the insurer.
• Start your own business tax exemption available to long-term unemployed (at least 15 months). Income tax exemption of up to €40,000 per annum for the first two years.
• PRSI on all income of PAYE workers from 2014.

Business Taxation
• No change in corporate tax rate.
• Lower rate of employer PRSI was due to revert to 8.5% in 2014. This was funded by the pension levy which has not been abolished (see stamp duty below). There has been no announcement on reverting to the 8.5% PRSI rate. The increase to 8.5% employer’s PRSI from 1st January 2014 was confirmed in the Social Welfare Bill.

Relevant Contracts Tax
• No changes to note

Indirect Taxes
• No change in the 9% VAT rate for the tourism industry.
• Increase in cash receipts threshold for VAT to €2 million from 1 May 2014.
• Farmer’s flat rate addition increased to 5% from 1 January 2014.
• VAT Anti-Fraud Measures introduced such as reversal of input credit on invoices which are not paid within six months of supply.

Stamp duty
• Pension fund levy increased to 0.75% in 2014.
• Bank levy to raise €150 million.

Carbon Tax
• No changes to note

Capital Taxes
• Property purchase incentive extended to the end of 2014 (exemption from capital gains tax for properties purchased and held for seven years).

(Local) Property Tax
• No changes to note

Miscellaneous Provisions & Announcements
• Bereavement allowance of €850 has been abolished.
• Jobseekers allowance for those under 25 cut to €100, and new rate of €144 for those reaching age 25 in 2014.
• Free GP care for under 5s (i.e. GP only medical card).
• Air travel tax abolished (“reduced to zero”). This tax was introduced in 2011 and costed around €3 per flight.
• DIRT rate increased to 41% in 2014.
• No change in motor tax, no change in duty on petrol/motor diesel
• Prescription charge increased to €2.50 per item.
• Excise duty increases from midnight 15 October 2013: standard measure +10c, 75cl bottle of wine +50c, pack of 20 cigarettes +10c
• Telephone allowance to be abolished in 2014.
• Maternity and adoptive benefit to be standardised at €230 for new claimants in 2014.
• Illness benefit waiting period increased from 3 to 6 days.
• Home renovation incentive will allow taxpayers to claim relief at 13.5% on improvements to their principal private residence. This is designed to encourage the employment of tax compliant contractors. Spend bracket €5,000 – €30,000. Further details on this scheme is now available on the Revenue website here.
• Income threshold on over 70s medical cards has been reduced to €900 to week for a couple and €500 for a single person.

Summary Statistics

Budget 2014 Budget 2013
Capital Gains Tax Rate 33% 33%
Capital Acquisitions Tax Rate 33% 33%
Income Tax Rates
Lower 20% 20%
Higher 41% 41%
DIRT Tax
41% (41% – where payments made less frequently than annually) 33% (36% – where payments made less frequently than annually)
Tax Credits
Single Person €1,650 €1,650
Married Couple €3,300 €3,300
PAYE Credit €1,650 €1,650
Rate Bands
Single/widowed €32,800 €32,800
Single/widowed with dependent children €36,80 €36,800
Married -one income earner €41,800 €41,800
Married – two income earners €65,600 €65,600
PRSI
Contribution Ceiling No limit No limit
Universal Social Charge
< €10,036 Exempt Exempt
€ 0 – €10,036 2% 2%
€10,037 – €16,016 4% 4%
>€16,016 7% 7%
Self-employed > €100,000 10% 10%
Age >70/medical card holders with income < €60,000 – Max rate 4% 4%
Age >70, income > €100,000 – Max rate 7% 7%

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.

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Budget 2013

5 December 2012

Personal Taxation
• 4% USC cap for those aged > 70 years or medical card holders has been abolished where income is greater than €60,000.
• Employee PRSI: Removal of weekly PRSI allowance from full rate and modified rate PRSI contributors (€127).
• Self employed PRSI: Increase in minimum contribution from €253 to €500 annually.
• PRSI on Unearned Income: To apply to PAYE workers from 2014 onwards.

Business Taxation
• Committed to 12.5% corporation tax rate.
• 3 Year Relief for Start-Up Companies: Relief is extended to allow unused relief from 1st 3 years to be carried forward for use in subsequent years (subject to maximum relief in relation to employers’ PRSI).
• Close company surcharge de minus limit has been increased from €635 to €2,000.

Relevant Contracts Tax
• No changes to note

Indirect Taxes
• VAT cash receipts threshold increased from €1 million to €1.25 million from 1 May 2013.
• Motor tax increases – From 1 January 2013 higher rates apply for all categories with the exception of electric vehicles, and CO2 band A0.

Stamp duty
• No changes to note

Carbon Tax
• Extended to solid fuels – rate of €10 per tonne from 1 May 2013, and €20 per tonne from 1 May 2014.

Capital Taxes from 5 December 2012 (midnight)
• Rate increased from 30% to 33% from midnight.

(Local) Property Tax
• Collection will commence on 1 July 2013, with a half year charge in 2013.
• Rate of 0.18% of market value for properties up to €1 million, rate of 0.25% to any excess value over €1m. Charges calculated at the midpoint of property bands of €50,000 increments.
• Three year exemption for first time buyers, or those buying new or previously unoccupied houses.
• Non principal private residence charge will cease on 31 December 2013.
• Deferral of property tax in some cases subject to 4% interest charge.
• Non payment may result in deduction at source (PAYE workers) or refusal of a tax clearance certificate (self employed).

Miscellaneous Provisions & Announcements
• Maternity benefit will be taxable from 1 July 2013, but not liable to universal social charge
• BIK on preferential home loans decreased from 5% to 4%, other loans rate increased from 12.5% to 13.5%.
• Tobacco excise increased by 10c on pack of 20, 50c per 25kg pouch of roll-your-own from midnight 5 December 2012.
• Licenced road hauliers diesel excise rebate will apply from 1 July 2013.
• DIRT rate increased from 30% to 33% from payments received from 1 January 2013.
• Respite Care Grant decreased from €1,700 to €1,375 per annum.
• Dual car registration for 2013 – prefix 131 for 1st 6 months, and 132 for 2nd 6 months. The objective is to create a two period sales peak each year to help stabilise the industry.
• Medical cards will be replaced with GP Only cards for those aged > 70 and with income of €600 – €700 for a single person, or €1,200 – €1,400 for a married couple.
• Drugs Payment Scheme (DPS) increased from €132 to €144 per month, with the prescription charge for medical card holders increased to €1.50.
• Child benefit rate to be reduced by €10 per month.
• Duration of Jobseekers payment to be reduced by 3 months.
• Extension of the Credit Review Office to provide more assistance to the SME sector.
• Simplification of charitable donations so charity now gets tax relief on all donations at blended rate of 30%.

Summary Statistics

Budget 2013 Budget 2012
Capital Gains Tax Rate 33% 30%
Capital Acquisitions Tax Rate 33% 30%
Income Tax Rates
Lower 20% 20%
Higher 41% 41%
DIRT Tax
33% (36% – where payments made less frequently than annually) 30% (33% – where payments made less frequently than annually)
Tax Credits
Single Person €1,650 €1,650
Married Couple €3,300 €3,300
PAYE Credit €1,650 €1,650
Rate Bands
Single/widowed €32,800 €32,800
Single/widowed with dependent children €36,800 €36,800
Married -one income earner €41,800 €41,800
Married – two income earners €65,600 €65,600
PRSI
Contribution Ceiling No limit No limit
Universal Social Charge
< €10,036 Exempt Exempt
€ 0 – €10,036 2% 2%
€10,037 – €16,016 4% 4%
>€16,016 7% 7%

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.

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Budget 2012

6 December 2011

Personal Taxation
• No changes in Income Tax rates, bands or credits.
• Universal social charge exemption increased from €4,004 to €10,036, and the move to a cumulative system will allow adjustments for under/over payments during the year.

Business Taxation
• Corporation tax exemption for new companies extended to 2014
• Employer’s relief from PRSI on pension contributions made by employees reduced to Nil from 1 January 2012 (currently 50% relief applies)
• No change in the Corporation Tax rate

Relevant Contracts Tax
• No changes to note

Indirect Taxes
• Standard VAT rate increased from 21% to 23% from 1 January 2012, in his speech Mr Noonan, said that this was the front loading of the increases in VAT from the EU/IMF deal and said that there will be no more increases in VAT in the life time of this government.
• Open farms can avail of tourism rate of 9% from 1 January 2012
• Increase in excise duty on cigarettes by 25c; no increase in alcohol excise duty, however legislation due on low cost selling

• Motor tax increases – average increase of 7.5% for cars taxed by engine capacity. But increases of over 50% for those taxed under the CO2 model (e.g. Class A increase of €56 to €160). This adjustment is required to reflect the increase in cars eligible for the lower CO2 model rates (17.69% of cars taxed in 2011 to date qualify, but they only account for 9.46% of the total motor tax income).

Stamp duty
• Abolition of multiple rates for non-residential stamp duty. For such instruments executed after 6 December 2011 a rate of 2% will apply.

Carbon Tax
• Increase of €5 to €20 per tonne on fossil fuels.

This equates to 1.4 cent per litre on petrol, and 1.6 cent per litre on diesel, this will take effect from midnight of the budget.

For a typical domestic oil fill of 1,000 litres of kerosene, the cost has increased by €14.40, and for natural gas €14.46 per kilowatt hour. Carbon tax increases on heating fuel will only take effect from 1st May 2012.

Capital Taxes from 6 December 2011 (midnight)
• Rate of capital acquisitions tax increased from 25% to 30%. Group A threshold to be reduced to €250,000.
• Rate of capital gains tax increased from 25% to 30%.
• New capital gains tax exemption for properties bought until the end of 2013, once property is held for at least seven years.

Miscellaneous Provisions & Announcements
• For items of public expenditure including health and social welfare, please see our Budget 2012 – Public Expenditure Measures page.
• Removal of the 36 day tax exemption for illness benefit.
• Mortgage interest relief to increase to 30% for first time buyers who bought at the height of the boom in the the period 2004 – 2008. A 25% rate applies for first time buyers in 2012, with a 15% rate for non-first-time buyers
• Household charge of €100 to be introduced in 2012, pending the development of a full property tax from 2014. Waiver for those on mortgage supplement and unfinished estates.
• DIRT rate increase by 3% for interest received on or after 1 January 2012

 

Summary Statistics

Budget 2012 Budget 2011
Capital Gains Tax Rate 30% 25%
Capital Acquisitions Tax Rate 30% 25%
Income Tax Rates
Lower 20% 20%
Higher 41% 41%
DIRT Tax
30%(33% – where payments made less frequently than annually) 27%/(30% where payments made less frequently than annually)
Tax Credits
Single Person €1,650 €1,650
Married Couple €3,300 €3,300
PAYE Credit €1,650 €1,650
Rate Bands
Single/widowed €32,800 €32,800
Single/widowed with dependent children €36,800 €36,800
Married -one income earner €41,800 €41,800
Married – two income earners €65,600 €65,600
PRSI
Contribution Ceiling No limit No limit
Universal Social Charge
< €4,004 Exempt
< €10,036 Exempt
€ 0 – €10,036 2% 2%
€10,037 – €16,016 4% 4%
>€16,016 7% 7%

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.

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Budget 2012 – Public Expenditure Measures
Finance Bill 2011
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Budget 2012 – Public Expenditure Measures

5th December 2011

Minister for Public Expenditure & Reform, Brendan Howlin addressed the Dail today in relation to the expenditure budget for 2012.

The main points are as follows:

• Target deficit of 8.6% of GDP in 2012
• Public service pay bill to fall by €400m in 2012, with a 12% staff reduction
• No reduction in weekly rates of social welfare payments
• Basic child allowance rate to be maintained. Over the next two years however, they will standardise the rate payable per child, by reducing the allowance for additional children.
• Fuel allowance period to be reduced from 32 to 26 weeks.
• Employer’s redundancy rebate to be decreased by 60% to 15%
• Increase in the monthly threshold under the Drugs Payment Scheme (DPS) from €120 to €132
• Increase in €250 of the student contribution to third level fees
• Job seeker benefit to be assessed on a 5 day week were recepient is a part-time worker (currently based on 6 day week)

Budget 2012 continues with Minister Michael Noonan’s speech tomorrow at 3pm.

Related Articles
Budget 2012
Finance Act (No. 3) 2011
Finance Bill 2011
Budget 2011
National Recovery Plan 2011 – 2014