tax-return-service budget-2027-ireland-summary

Budget 2027

What it means for you

Wondering what Budget 2027 means for your pay, family finances or future plans?

We’ve brought the key updates below - what’s changing, how it affects you and when it will happen.

Tax Credits & Rate Bands

  • Increase in Personal, Employee and Earned Income Tax Credits of €125
  • Home Carer Credit increased by €100 
  • Standard Rate Tax Band increased by €2,500 to €46,500 for a single person, with pro-rata increases for single parent families and married/civil partnership couples. 

Universal Social Charge (USC)

  • The entry threshold to the 3% USC rate will increase by €1,600 to €30,300. 

Minimum Wage

  • Increasing by 79c per hour to €14.94, effective from 1st January 2027. 

Vehicle Registration Tax (VRT)

  • VRT relief for electric vehicles is being extended to 31st December 2028
  • Increase in Category A VRT rates by 1% for Bands 3 to 20 (emissions more than 80g/km)

CGT (Capital Gains Tax)      

  • Reduction in CGT rate from 33% to 31% effective immediately

CAT (Capital Acquisitions Tax)      

Threshold adjustments for exemption for CAT, effective immediately:

  • Group A         €400,000 to €420,000 
  • Group B         €40,000 to €44,000 
  • Group C         €20,000 to €22,000             

Housing

Rental

  • The Rental Tax Credit is being increased by €150, up to €1,150, for single or separately assessed individuals & €2,300 for jointly assessed couples
  • Rent-a-room Relief will increase from €14,000 to €16,000 per annum, and it will be extended to include designated auxiliary dwellings between 32 and 45 square meters, once they comply with the new planning regulations implemented on 27th of July.

Help to Buy Scheme

  • Help to Buy Scheme relief has increased by €5,000, to a maximum amount of €35,000, with immediate effect for first time buyers.

Energy

  • Carbon Tax planned increases on auto fuels, marked gas oil and solid fuels will be postponed to May 2027
  • Fuel duty rates will remain unchanged until the end of February 2027, with restoration over 4 increments by 30th June 2027
  • The Income Tax Disregard for profits from micro-generation of electricity is increasing from €400 to €600 per year
  • The Carbon Tax on kerosene and natural gas will be reduced to €48.50 per tonne of CO₂ and will remain at this rate until 2030.

Excise Duty

  • Cigarettes Duty increased by €1.00 per pack of 20, and pro rata increases will be applied for all other tobacco products
  • 20c increase per ml for E-liquid products.

Education

  • The Student Contribution Fee will be permanently reduced by €150 a year, to €2,350.

Social Welfare

  • There will be a €10 weekly increase for Social Welfare Payments, including pensions
  • Fuel Allowance is up €5 per week
  • Living Alone Allowance increased by €3 per week
  • Child Support payments will increase by €6 per week to €64 for under 12s and to €84 for over 12s

Childcare Services

  • Increase in Childcare Service Relief Income from €15,000 to €20,000 per annum, with removal of the cap on the number of children that can be minded in a childminder’s home
  • Maximum Childcare Fees will fall from €735 to €550 per month for children under Senior Infants.

Savings & Investments 

  • New Investment Account will be available from July 2027. There will be a maximum annual contribution of €12,000, with a tax-free amount of €50,000.
  • Savings over this amount will be taxed at a flat rate of 1% on fund value. Tax to be administered by the provider, not the individual.
  • No other taxes and no deemed disposal rules will apply.
  • There will be one account per person for those aged 18 and over, who hold a PPSN
  • Decrease in Investment Undertakings Tax, Life Assurance Tax, Tax on Foreign Life Assurance policies and equivalent offshore funds, from 38% to 35% effective January 2027.

Our guide to Ireland’s new Savings and Investment Account covers everything we know so far. We’ll update this guide as more details emerge.

Read our guide

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Examples of how Budget 2027 could impact you!*

Single or Separately Assessed

Annual Income
€40,000
€50,000
€75,000
Rate Bands
€0
€500
€500
Tax Credits
€250
€250
€250
USC
€16
€16
€16
Annual Tax Saving
+€266
+€766
+€766

Married/Civil Partnership (One Income)

Annual Income
€40,000
€50,000
€75,000
Rate Bands
€0
€0
€500
Tax Credits
€375
€375
€375
USC
€16
€16
€16
Annual Tax Saving
+€391
+€391
+€891

Married/Civil Partnership (Both Earning)

Annual Income
€40,000
€50,000
€75,000
Rate Bands
€0
€1,000
€1,000
Tax Credits
€500
€500
€500
USC
€32
€32
€32
Annual Household Tax Saving
+€532
+€1,532
+€1,532

*Estimated annual savings compared with 2026, assuming unchanged gross income, PAYE employment and joint assessment for married couples/civil partners. Excludes PRSI changes, pension contributions and additional tax reliefs. Subject to final legislation.

Please note: There may be further changes to the above information following the Finance Bill. Every effort has been made to ensure that the information provided here is accurate and up to date (as of 7th October 2026). The information provided is of a general nature and may not address the specific circumstances of a particular individual. Cornmarket does not accept any liability arising from any errors or omissions.

Warning: The provision of this service does not require licensing, registration or authorisation by the Central Bank of Ireland, and as a result is not covered by Central Bank of Ireland rules designed to protect consumers or by a statutory compensation scheme.

Cornmarket’s Tax Return Service is not a regulated financial product.