My Budget 2025 Summary
1st October 2024
The Highlights of Budget 2025: Key Takeaways
Income Tax
The standard rate income tax band will be increased by €2,000 to €44,000 for single persons and to €53,000 for married couples with one earner; no other changes to income tax rates or bands.
The 4% Universal Social Charge rate will be reduced to 3%.
The entry point for the new 3% Universal Social Charge rate will be increased by €1,622 to €27,382.
The Personal, Employee (PAYE) and Earned Income (Self-Employed) Tax Credits will be increased by €125 to €2,000.
The Home Carer tax credit will be increased by €150 to €1,950.
The single person child carer tax credit will increase by €150 to €1,900.
The incapacitated child tax credit will increase by €300 to €3,800.
The dependent relative tax credit will increase by €60 to €305.
The blind tax credit will increase by €300.
The Rent tax credit will be increased from €750 to €1,000 per year.
Mortgage Interest Relief extended for another year.
The sea-going naval personnel tax credit of €1,500 will be extended for 5 years to the end of 2029.
The Help to buy (HTB) scheme will be extended in its current form until December 2029.
Tax relief on pre-letting expenses for landlords extended to December 2027.
Vacant homes tax will be increased from 5 to 7 times the property’s existing Local Property Tax rate, with effect from November 2024. This tax applies to residential properties which are occupied for less than 30 days in a 12-month period.
Regarding the Residential Zoned Land Tax, there will be a targeted exemption available to landowners if they seek to have their land re-zoned to reflect the activity they carry out on the land.
Corporation Tax
The main Corporation Tax rate will remain unchanged at 12.5% for companies with revenues less than €750m.
The first-year payment threshold for the Research & Development Tax Credit will be increased from €50,000 to €75,000.
A participation exemption for certain foreign dividends will be introduced from the 1st January 2025.
The Employment Investment Incentive, Start-up Relief for Entrepreneurs & Start-up Relief for Entrepreneurs will be extended for another 2 years.
Relief available under the Start-up relief for entrepreneurs will be increased from €700,000 to €900,000.
The CGT relief targeted at angel investors in innovative start up companies will be amended to provide a lifetime limit on gains to which the relief applies from €3m to €10m.
The amount that can be claimed under the Employment Investment Incentive Scheme (EIIS) will be doubled from €500,000 to €1,000,000.
The Motor Insurers Insolvency Compensation Fund levy will be reduced from 1% to zero.
The accelerated capital allowance scheme for gas and hydrogen-powered vehicles will be extended for a further year.
There will be an 8% uplift in the Section 481 Film Tax Credit, this is subject to state aid approval. This will apply to feature film productions with a maximum qualifying expenditure of €20 million.
There will be a new tax credit for Unscripted Production at a rate of 20% on qualifying expenditure up to €15 million, subject to state aid approval and similar to the other audio visual reliefs, the project will be required to pass a cultural test.
The accelerated capital allowances scheme for energy efficient equipment will be extended for a further year.
The Bank Levy will be extended for another year.
Small Benefit Exemption
The annual limit for the Small Benefit Exemption will increase to €1,500 and the number of non-cash benefits will increase to 5 in a single year.
Benefit in Kind – Motor Vehicles
In relation to the Benefit in Kind on company cars, the temporary universal relief of €10,000 to the Original Market Value will be extended for another year.
For an employee with an electric company vehicle, this will give an overall benefit in kind relief of €45,000 in 2025.
There will be a benefit in kind exemption for the provision of electric vehicle chargers at the home of a director or employee.
VRT
There will be a VRT amendment for battery electric commercial vehicles so that they can qualify for the €200 VRT rate.
An emissions-based approach will be introduced for B commercial vehicles, which will provide for a lower 8% rate for category B vehicles with a CO2 emission of less than 120grams per KM.
Vat
The Vat Registration thresholds for businesses will be increased from €40,000 to €42,500 for services and from €80,000 to €85,000 for goods.
The reduced 9% Vat rate applicable to Electricity & Gas will continue until the 30th April 2025.
The VAT rate on the installation of heat pumps will be reduced from the standard rate (23%) to zero from the 1st January 2025.
No other changes to Vat rates.
Capital Taxes
The Group thresholds for Capital Acquisitions Tax (CAT), which apply to gifts and inheritances, will increase for Group A from €335,000 to €400,000, for Group B from €32,500 to €40,000 and for Group C from €16,250 to €20,000.
The upper age limit for Retirement Relief extended from 65 until the age of 70 will be retained.
In relation to retirement relief, where there are disposals by the child or children above €10 million within 12 years of receiving the assets, a clawback of the retirement relief will apply.
The 6-year active farmer test for agricultural relief will be extended to the person who provides the gift or inheritance
Stamp Duty
The rate of stamp duty applicable to residential property valued at €1.5 million or above will be increased to 6% with immediate effect. The existing rate will continue to apply to any value up to €1 million & 2% on values above €1 million, with a third rate of 6% on any value above 41.5 million.
The higher rate of stamp duty on the bulk acquisitions of houses will be increase from 10% to 15% with immediate effect.
The Young Trained Farmer stamp duty relief will be amended so it is available where it is claimed by an individual farmer who carries on the farm business through a company.
The Stamp duty relief which applies to farmers who lease land will be amended to include farmers who have chosen to incorporate their farming business.
Excise Duties
The price of 20 cigarettes will increase by €1, with pro rata increases on other tobacco products.
A domestic tax on e-cigarettes and vaping products will be introduced in 2025. The tax will apply to all e-liquids at a rate of 50 cent per ml of e-liquid.
Carbon Tax
The rate per tonne of carbon dioxide emitted for petrol and diesel will go up from €56.00 to €63.50 from the 9th October next.
Farming
The flat rate addition for farmers will be increased from 4.8% to 5.1% from 1st January 2025
General stock relief, stock relief for young trained farmers and stock relief for registered farm partnerships will be extended to the end of 2027.
The relief for young trained farmers will be amended so it will be available where it is claimed by an individual farmer who carries on the farm business through a company.
Welfare
There will be a €12 increase in the state pension & other welfare recipients in 2024.
An October bonus of 100% will be paid to all social welfare recipients.
The qualified child payment will be increased to €62 per week for Over 12’s and to €50 per week for Under 12’s.
The carers allowance means test disregard will be increased to €625 for a single person and €1,250 for a couple.
The Domiciliary Care Allowance will increase by €20 to €360.50 per week.
Carers’ Support Grant will be increased by €150 to €2,000.
The carers allowance will be made a qualifying payment for the fuel allowance.
Maternity, Paternity, Adoptive and Parents payments will be increased by €15.
A newborn grant of €420 will be paid to families of each newborn child, in addition to first month of child benefit.
The hot school meals programme will be expanded to all remaining primary schools in 2025.
Free schoolbooks will be extended for all transition and senior cycle pupils in recognised post primary schools.
Free public transport to be extended all children aged 5 & 8 years old.
Cost of Living (Once-off) Measures
An Electricity Credit of €250 for all households to be paid in two instalments of €125 before and after Christmas.
An additional lump sum payment of €400 to those in receipt of the working family payment.
An additional lump sum payment of €400 to those in receipt of the Carer’s Support Grant, Disability Allowance, Blind Person, Invalidity Pension and Domiciliary Care Allowance in November.
A double payment of Child Payment, worth an additional €140 for each child, will be made to all qualifying households in November and December.
A double payment of the Foster Care allowance will also be made this year.
A €300 lump sum payment will be made to recipients of the Fuel Allowance in November.
All recipients of the Living Alone Allowance will receive a once-off payment of €200.
An extension of the fee reduction on school transport services for a further year.
An extension of the fee waiver for students sitting state exams.
The continued reduction in the Student Contribution of €1,000 for eligible students.
A once-off reduction of approximately 33% in the contribution fee for apprentices in higher education
An increase in the Post Graduate Tuition fee contribution by €1,000 for student grant recipients
Other
The national minimum wage will increase by €0.80 per hour to €13.50 per hour from 1st January 2025.
We hope you find this information useful. If you have any questions, feel free to contact us.
Landline/WhatsApp: +353 (0) 64 6632105
Email: info@timothykelliher.ie
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