08/10/2026
Budget 2027 at a glance.
AT A GLANCE
€46,500 new point where the 40% tax rate starts for a single person
+€125 on the personal, employee and earned income tax credits
€14.94 minimum wage per hour from 1 January 2027
31% standard capital gains tax rate, down from 33%
€35,000 maximum Help to Buy, up from €30,000
Income tax and USC
The point where you start paying tax at 40% goes up by €2,500. For a single person it moves from €44,000 to €46,500.
The personal, employee and earned income tax credits each go up by €125 to €2,125. The home carer credit goes up by €100 to €2,050.
The 2% USC band is widened from €28,700 to €30,300. This means a full time worker on the new minimum wage should not move into the 3% USC band.
Payroll
The national minimum wage goes up by 79c from €14.15 to €14.94 an hour from 1 January 2027. Employers should plan for this in their payroll costs.
The weekly pay threshold for the higher rate of employer PRSI goes up from €552 to €600. This is due to the increase in the minimum wage.
Business
The start up relief for new companies (section 486C) is extended to the end of 2030.
Several enhancements are being made to the R&D tax credit following a review of the regime.
From 1 January 2027, changes to the Enhanced Reporting Requirements (ERR) system will give employers the option to report travel expenses and other ERR information either before making a reportable tax-free payment or by the 14th day of the following month.
Capital gains, inheritance and investments
The standard rate of capital gains tax drops from 33% to 31% for disposals on or after 7 October 2026.
The tax free thresholds for gifts and inheritances go up for anything received on or after 7 October 2026. Group A (children) goes from €400,000 to €420,000. Group B goes from €40,000 to €44,000 and Group C from €20,000 to €22,000.
Exit tax on investment funds and life assurance policies drops from 38% to 35%.
A new Investment Account will be introduced from 1 July 2027, subject to detailed qualifying conditions.
Housing and rent
The rent tax credit goes up by €150 to €1,150 for a single person and by €300 to €2,300 for a couple.
Help to Buy for first time buyers goes up from €30,000 to €35,000. This applies straight away.
Rent a room relief goes up from €14,000 to €16,000 a year from 1 January 2027. It will also cover detached homes in back gardens built from 27 July 2026 if they meet the size and planning rules.
The tax free amount for selling solar electricity back to the grid goes up from €400 to €600. There is also more funding for home energy upgrades and solar panels.
Families and social welfare
Many social welfare payments will go up by €10 from January 2027. A double Christmas bonus will be paid in the week starting 7 December 2026.
There is a new €500 Cost of Disability payment for people on long term disability payments. It will be paid in 2027.
The student contribution fee will be reduced by €150 a year, from €2,500 to €2,350.
Childminders will be able to earn up to €20,000 a year tax free, up from €15,000. The limit of three children is removed.
Motoring and fuel
Carbon tax on home heating oil and gas is cut from €63.50 to €48.50 a tonne.
Carbon tax on petrol and diesel stays at €71 a tonne until 1 May 2027 and then rises to €78.50.
The temporary cut in excise on petrol and diesel is extended to 28 February 2027. Excise rates will then gradually increase to their previous levels by 30 June 2027.
The €5,000 VRT relief for electric cars is extended to the end of 2028.
VRT goes up by 1% on cars with emissions over 80g/km from 1 January 2027.
What happens next
Some of these changes apply straight away and others from 1 January 2027 or later. Many of the tax changes still need to pass in the Finance Bill.
