The Live Q&A is now closed, but you can continue to submit questions to dominic.coyle@irishtimes.com and we will try to address them in our weekly Q&A columns.
Thank you for all your questions. The Live Q&A is now closed, but you can continue to submit questions either here or to dominic.coyle@irishtimes.com and we will try to address them in our weekly Q&A columns.
Q: On the new 38 per cent tax rate on funds, is this only on gains from today, or does it apply to untaxed profits in gross roll up funds (last eight years not yet deemed disposed)?
From L Fitz
A: The new rate is likely to apply to disposals (or deemed disposals) on or after the commencement date of the new rate.
It is unclear when the commencement date might be but we believe that it might be January 1st, 2026.We will need to see the detail in the Finance Bill to confirm the position.– BP
Q: Is there any update on deemed disposal on exchange traded funds (EFTs)? My understanding is that it would be abolished in Budget 2026.
From Peter
A: The Minister did not comment on the deemed disposal rule for ETFs in the budget announcement. He has committed to publish a roadmap early next year setting out the plans to simplify and update the taxation of these investments.
We will need to wait and see if there is any clarity regarding deemed disposals in this publication. – JL
Q: There was no mention of benefit in kind (BIK) company electric cars.
What is the exempt value for 2026, 2027 and 2028? Is there an extension to the €35,000 + €10,000 for 2026 before BIK kicks in?
From Niall
A: An extension of the temporary reduction to the original market value used in assessing for benefit in kind was announced by Minister Donohoe. It means the €10,000 relief available this year will be repeated next year.
Relief will be available in subsequent years but at a reduced level – €5,000 in 2027 and €2,500 in 2028 before, the Minister said, it would be abolished in 2029.
So, a vehicle made available for the partial private use of an employee this year will attract €35,000 relief plus a €10,000 reduction on original market value (OMV) – meaning a car worth €55,000 will have a value for BIK purposes of just €10,000 for 2025 and 2026, before the BIK value rises to €15,000 in 2027, €17,500 in 2028 and €20,000 in 2029.
However, the initial EV relief figure is also falling in coming years so if your employee first gets use of this car next year rather than this year, the initial relief will only be €20,000, not €35,000.
The other reductions in OMV outlined above also apply, so the value for BIK purposes of the same vehicle will be €25,000 next year, €30,000 in 2027 and €32,500 in 2028 - solely because it was first given to the employee in 2026, not 2025. – DC
Q: Any changes to jobseeker’s?
From James Gavin
A: From January, the jobseeker’s allowance will increase by €10 to €254 per week for individuals aged 25 years and over. For those under 25 years of age, the maximum weekly rate will increase to €163.70. – JL
Q: Was there any change to the discriminatory inheritance tax for the estates of single people, no children?
From Lucy
A: Unfortunately, there were no changes announced to inheritance tax for the estates of single individuals with no children. The Tax Strategy Group suggested blended rates for individuals with no children, but so far this hasn’t been implemented. – JL
Q: On mortgage interest relief – I currently have €600,000 outstanding on my mortgage. Do I get any relief, or is there a sliding scale? Thank you.
From Diarmuid
A: Unfortunately, the Mortgage Interest Tax credit is not available to you as the outstanding loan balance must be between €80,000 and €500,000 on December 31st 2022. – JL
Q: Is the taxation rate on gains for exchange traded funds (EFTs) now 38 per cent, and is this effective immediately?
From John O’D
A: The Minister announced in the budget that the tax rate on certain investments such as Irish domiciled funds, life assurance policies, offshore funds and certain foreign life assurance policies, would reduce from 41 per cent to 38 per cent.
The commencement date of this change is unclear but it looks that it might be January 1st. We will need to wait until the Finance Bill to see the detail on this. – BP
Q: I see that the income disregard for Carer’s Allowance is being increased substantially. When is that likely to take effect?
From Paul
A: The increase announced in income disregard for carers will kick in in July next year. – DC
Q: Will the €2,500 charge for third level student take effect immediately?
I have a child who started third level this year – September 2025 – and I understand I need to pay €3,000 before the end of October? Thank you.
From Joanne
A: Yes, it does. The Government has said that the reduced fee will benefit students in the current 2025/2026 academic year.
For those who have paid fees in full, a refund should be on the way, though you may need to formally apply for it, depending on the college. For people in your position, who have yet to pay the fee, your bill is now €500 lower. – DC
Q: What date does the pension get the €10?
From Dorothy
A: The weekly State pension will increase by €10 from January. – JL
Q; Will the Working Family Payment get the €400 cost of living lump sum again this year?
From Pauline
A: The €400 lump sum payment for households on the Working Family Payment was one of that battery of one-off cost of living measures that the Government decided not to repeat this year. So it will not be paid again this winter. – DC
Q: Does the €5,000 increase to SUSI income thresholds apply to all bands or just the top band?
From Pamela
A: The upper family income limit for access to third level grant support through SUSI has been increased by €5,000 as you say, to €120,000.
It is not clear, as yet, whether each of the SUSI bands will be increased or just that highest band where you qualify for a further €500 discount in registration fees.
I expect more clarity will emerge from the Department of Further and Higher Education, Research, Innovation and Science in the coming days. – DC
Q: I signed contracts for a new build apartment last week, but it doesn’t look like any VAT savings will be passed on to me. Does that mean the developer keeps the extra money?
From Sarah
A: If the VAT the developer has to pay Revenue is 4.5 percentage points lower than it was before the budget and your developer does not pass the benefit on to you, then they will certainly benefit from that extra money.
Revenue is not going to come looking for it so it will just stay padding his account. Worse, as another reader has pointed out, you will be hit by a higher stamp duty charge.
Stamp duty is charged on the price of a new property, less VAT. So, if the VAT element is reduced but the purchase price remains the same, a greater portion of that price is subject to stamp duty. I’d certainly press the developer to adjust your purchase prices downwards as his costs are now lower. – DC
Q: Will the Help to Buy Scheme and the First Home Scheme’s current maximum ceiling (for example up to €500,000 in Dublin) increase above the existing threshold, as it’s very hard to find any new build properties in Dublin within this limit?
From Nomi Khan
A: You’re certainly correct that it is a challenge to find properties in Dublin that will meet the price criteria for some of the home purchase incentive schemes, although the Government may hope its new incentive for building apartments helps with that.
In the meantime, as you suspect, there was no change announced in the budget in the ceiling above which Help to Buy and First Home are not available to buyers. There is always a chance that that may change when the Finance Bill is published, which is expected to be next week, but we will have to wait and see. – DC
Q: We are buying a new apartment which is due to be completed in December or January.
We have signed contracts which state the price includes VAT at 13.5 per cent but the contract states the final price can be adjusted if the VAT rate rises or falls. Does this mean that we will get a reduction in the final price when the sale closes?
From Sarah
A: That will be down to discussion between you and the developer, but if the contract allows for an adjustment on the basis of changes in VAT, it sounds to me that the developer in this case is open to reducing the price you will pay to reflect the lower VAT they will have to pay as and from today. – DC
Q: Any change to inheritance tax?
From Claire Noonan
A: Unfortunately, the budget did not announce any changes to gift or inheritance tax. Changes could emerge in the Finance Bill, but this remains uncertain at present. – JL
Q: Have there been any change in the bands for Capital Acquisitions Tax (CAT) or in the rate of tax levied for CAT? Thanks.
From David
A: No changes to the CAT bands or the CAT rate were announced in the budget. In fact, there was no mention of CAT at all. However, there could be changes in the Finance Bill, which is due to issue in the coming weeks, so keep an eye out for this. – BP
Q: Are the tax rules changing for exchange traded funds (EFTs)?
From Sarah
A: The tax rate on ETFs is being reduced from 41 per cent to 38 per cent.
The Minister also announced that he would publish a roadmap early next year setting out the intended approach to simplify and adapt the tax rules with such investments.While this is positive, we will need to wait to see the detail in the report next year. – BP
Q: Will the reduction of the VAT rate on new apartments result in me paying higher stamp duty given my situation?
I am in the process of purchasing a new mews type property (which I think can be considered an apartment). Contracts are not yet signed. I don’t expect the developer to reduce the price to me given the change in the vat rate from 13.5% to 9% in the budget.
Given the stamp duty is paid on the value of the building less VAT 1%, this means I will be paying more in stamp duty. Hardly what they intended, to penalise purchasers more?
From John
A: I’m sceptical whether a mews type development will be accepted as an apartment for the purposes of the new VAT regime by Revenue but that’s between your developer and the tax people.
If it does qualify, I see no reason why you would not push for a price cut given the developer now has a lower tax bill. If the developer does not budge and the mews does qualify as an apartment development, then, yes, you will be hit with a slightly higher stamp duty bill. – DC
Q: Are there any proposed changes that would make it more attractive to postpone taking the State pension until after 66 years of age? See Fiona Reddan’s article dated January 30th, 2024, for details of the issues.
From Daniel
A: The last government did introduce the option of deferring drawing down your State pension beyond 66 (and as late as the age of 70) in return for a higher weekly payment. There was no further move in this area in Budget 2026.
The main likely beneficiaries of the new regime will be those struggling to meet the minimum social insurance criteria to qualify for a State pension. – DC
Q: As regards inheritance tax, I want to leave my house to my niece, but she won’t be able to afford the inheritance tax. Any advice? It’s worth about €400,000.
From Mary Power
A: The Capital Acquisitions Tax (CAT) Group B tax-free threshold of €40,000 should apply to your niece on the inheritance of your home on the assumption that she has not previously utilised this threshold.
As the property has an estimated value of €400,000, the amount subject to CAT should be €360,000, resulting in a CAT liability of €118,800.
Your niece may be exempt from CAT on the inheritance of your home if the conditions of the Dwelling House Exemption are met.
The conditions are: (1) The house was your only or main home at the date of your death (2) Your niece lives in the house for three years immediately before the date of inheritance (3) Your niece does not own or have an interest in any other houses at the date of the inheritance (4) Your niece continues to live in the house as her only or main property for six years after the date of inheritance. – JL
Q: Is there any change to social welfare payments for jobseekers?
From Rachel
A: People on Jobseeker’s Benefit see their payment rise €10 to a maximum weekly payment of €254, or by €16.60 to €422.60 if they have a qualified adult. The maximum figures (and the increases) are the same under means-tested Jobseekers’ Allowance if you are aged 25 or over.
For those under the age of 25, the maximum personal rate rises €10 to €163.70 a week, while those claiming with a qualified adult can get up to €327.40, up €22 on the current rate. – DC
Q: Previous budgets had an electric vehicle (EV) allowance of €20,000 in 2026 and €10,000 in 2027 against the open market value (OMV) of the car for benefit in kind (BIK) purposes. Those allowances now seem to be gone in Budget 2026?
This means someone with a EV company car out to the end of 2027 will actually be paying significantly more BIK annually even when factoring in the reduced new BIK rates for zero emission cars.
How does this incentivise the transition to EVs and where is the consistency in Government planning when people are trying to budget based on criteria stated for multiple previous budgets that then significantly changes a year later?
From Anthony
A: The previous EV OMV deductions remain in place on a tapered basis and will continue as outlined last year. In Budget 2026, it was confirmed that the additional temporary €10,000 OMV deduction has been extended into 2026 with a phase out of the relief over 2027 and 2028.
It may be possible that with the recently introduced lower BIK rates for EVs, that the fall in the OMV deduction will be somewhat offset by a lower rate BIK being applied (subject to business mileage).
The introduction of the A1 zero-mission (EV) BIK rates will be attractive for employers who want to ensure the lowest rate of BIK applies, where they provide a company car to their employees.– BP
Q: Is there anything for foster carers in budget?
From Josephine Haddock
A: Foster care again failed to feature in the budget. The last time the rate of foster care allowance increased was under Budget 2024, when weekly rates were increased to €400 (for children under 12) and €425 (for older children) from November 2024.
They had risen to €350 and €377 respectively at the start of that year and had been paid at €325 and €352 a week in 2023. – DC
Q: Will there be any change to the pupil/teacher ratio in primary schools?
From Eoin Cleary
A: This time around, there was no mention in the budget speeches of any change in the targeted pupil/teacher ratio in primary schools. Most of the increase in spending in education seems to be targeting special needs education. – DC
Q: Were the incentives for first time buyers changed?
From Seamus Byrne
A: From today, the VAT rate applied to the construction of new apartments will be reduced from 13.5 per cent to 9 per cent. This measure is due to last until December 31st, 2030.
It is hoped that this new measure will make new apartments more affordable which will be of benefit to first time buyers.
While not a new initiative, the Help to Buy Scheme is very useful for first time buyers. The scheme allows first time buyers to claim a tax refund of up to €30,000 for the deposit on a new home or self-build property. The refund is a portion of the income tax, and DIRT paid over the previous four years.
To qualify, individuals must be first time buyers, purchase or self-build a home to live in as their primary residence, and they must meet certain other conditions. – BP
Q: I’m one of the squeezed middle in a two income household and probably considered to be high earners. It appears to me we are worse off under this budget – is that the case?
From Mark
A: With no change in income tax bands, just a fractional (€13.18 per annum) “win” on USC and higher PRSI having kicked in at the start of this month (and again next October), I suspect you may be worse off, even before any increase in wages over the next year.
The distributional analysis published by the Government says that the poorest 10 per cent of the households fared best this time around with a 4.9 per cent rise in their weekly disposable income.
The benefit falls as you climb the household income ladder – to about 1 per cent for middle income households and just 0.2 per cent for the top 10 per cent, that analysis says. – DC
Q: If I, a single male in my late 30s, earn minimum wage for 39 hours per week while claiming some disability allowance along with the living alone increase and fuel allowance, what has Budget 2026 done for my finances?
From Patrick
A: You should benefit from the 65 cent an hour rise in the national minimum wage to €14.15 per hour, which equates to a 4.8 per cent pay rise. In addition, disability allowance has been increased by €10 a week to a maximum payment of €254.
The living alone allowance stays as it was but the fuel allowance will rise by €5 a week. All told, you will benefit more than most this time around. – DC
Q: Has there been any funding directed towards the much needed review of the drugs reimbursement process? As a cancer patient and advocate, this is something which has been promised but has seen no real progress in several years.
Aligned with a full review of the process, an early access scheme for drugs not yet fully considered for reimbursement has also been suggested. Thank you.
From Martin Sweeney
A: Budget 2026 contained no mention of additional funding for drug reimbursement although I understand talks are ongoing between the HSE and the groups representing the pharmaceuticals industry on a new four-year plan on access to medicines and pricing. – DC
Q: What changes have been made to the 41 per cent tax on investment funds and exchange-traded funds (ETFs)?
From Tim Cooke
A: The tax rate for some investments, including ETFs, certain offshore funds, ICAVs, unit trusts, authorised investment companies and foreign life assurance policies are being reduced from 41 per cent to 38 per cent. – JL
Q: Will the VAT reduction apply to all new apartments to be constructed? We have full planning on a 20 unit site in Dublin area.
I imagine as a consequence of the budget proposal that apartment prices may increase so as to make some individual locations in a lesser prime area more attractive to financial institutions to back the project. We have completed 340 units to date but are currently inactive. Thanking you.
From Liam Dowling
A: The VAT reduction to 9 per cent, from 13.5 per cent previously, applies from today on the sale of any completed apartment. That new rate, for now, runs until the end of 2030.
In addition, the Government announced enhanced deductions from corporation tax of certain costs incurred in building apartment complexes. This will apply for schemes that issue a commencement notice between today or the end of 2030.
An increase in the price of apartments that are largely already unaffordable for many will hardly do much to tackle the housing crisis but we will have to wait and see how the VAT reduction plays out. – DC
Q: Will the mortgage interest tax relief for 2025 be calculated against 2022 (as was the case for the 2023 and 2024 relief)?
From Stephen
A: Yes, it will and the same approach will be taken for mortgage interest paid in 2026 (and claimed in 2027), which now looks to be the final year for that credit. – DC
Q: Any changes to parents, maternity or paternity leave?
From Conor
A: Maternity and paternity leave arrangements remain as they were before the budget. – DC
Q: Will a qualified adult get the €10 rise?
From Adrian
A: The increase in respect of a qualified adult will not be a standard €10 and the amount will depend on the welfare payment.
For the State contributory pension, the payment for a qualified adult rises by €6.70 to €199.40 if the adult is under the age of 66 and to €268.40 – a rise of €9 a week – if they are older than that.
When it comes to the non-contributory State pension, a person with a qualified adult gets an additional €6.60 in respect of the qualified adult, a figure that seems to apply to a lot of the social assistance payments. – DC
Q: I am a grandfather Can I pay and later claim for my three grandkids university undergrad fees as well as give them the annual €3,000 tax free allowance?
From John Smyth
A: Yes, tuition fee tax relief at 20 per cent can be claimed by the individual who pays qualifying fees for an approved third level course. Therefore, you can claim income tax relief in respect to the college fees paid for your grandchildren.
Tuition fees relief is subject to a single disregard amount of €3,000 for full-time students and €1,500 for part time students each tax year. If you will pay tuition fees for more than one student, this disregard amount will only be deducted from your claim once.
The small gift exemption of €3,000 should apply for each of your grandchildren on the gift of the fees paid by you on their behalf. However, any fees paid in excess of €3,000 will be subject to Capital Acquisitions Tax (CAT) at 33 per cent if they have previously utilised their Group B threshold of €40,000.
Your grandchildren will also be required to file CAT returns if the total taxable value of gifts/inheritances taken exceeds 80 per cent of the Group B threshold.
If the qualifying tuition fees exceed €3,000, the gift could be given by you and your spouse (if relevant). This would provide that the total small gift exemption of €6,000 would apply (€3,000 each). – JL
Q: Are there any changes to the amount of income a married couple can earn before being liable for the base rate of tax? Thank you for this great service you’re offering.
From Mairead
A: There was no change in Budget 2026 to any income tax bands or rates. As a result, the amount you can earn next year before being liable for the standard 20 per cent income tax rate is the same, as is the point at which you move into the higher 40 per cent bracket.
With wages rising for most people, it means they will pay more income tax next year. – DC
Q: Does the increase in social welfare and Christmas bonus payments include the working family payment?
From James
A: The working family payment is not a flat rate payment. It pays eligible families 60 per cent of the difference between their average weekly family income (their earnings less tax, PRSI, USC and any pension or superannuation contributions) and the income limit that applies to the family which is determined by the number of children they have. The budget has added €60 to each of the weekly income limits. – DC
Q: On the Mortgage Interest Tax Relief, I believe this relief is being extended? How is the interest relief calculated? Is it 2025 interest versus 2024?
From Stephen
A: Yes, Mortgage Interest Relief is being extended, on a tapered basis, for two further years, to December 31st, 2026. Homeowners with an outstanding mortgage balance between €80,000 and €500,000 as of 31 December 2022 will be eligible.
The current level of relief will be maintained for the increase in interest paid in the 2025 tax year over 2022, with a maximum tax credit of €1,250 per property being available. This relief can be claimed in 2026.
A reduced level of relief will be available for the increase in interest paid in the 2026 tax year over 2022, with a maximum tax credit of €625 per property. This relief can be claimed by taxpayers in 2027.– BP
Q: I am paying crèche fees for three children. Are there any benefits in this budget for someone in my position?
From Elaine
A: Not immediately as far as I can see. Minister Norma Foley has hailed investment that “will reduce costs for families and increase supports for staff and providers” and promised a new maximum fee cap.
However, we will apparently have to wait months for further details of that, according to the Department of Children, Disability and Equality. Meantime, the budget funding will increase places available for early years childcare and keep fees at 2021 level in crèches availing of core State funding. – DC
Q: Is there change in the Capital Gains Tax rate?
From Tony
A: There is no change to the headline Capital Gains Tax rate of 33 per cent.However, the Minister announced that the lifetime limit for Entrepreneur’s Relief would be increased from €1 million to €1.5 million.
The relief provides for a 10 per cent tax rate on gains of up to €1.5 million (previously €1 million) arising on the sale of qualifying business assets. This change comes into effect from January 1st. – BP
Q: Was child benefit not mentioned?
From Tanya
A: There was no change to the Children’s Allowance in the budget, but the Minister did announce a change to the Child Support Payment which will increase by €16 to €78 per week for children aged 12 and over, with an increase of €8 to €58 per week for children under 12. – BP
Q: Does the mortgage interest relief extension only apply to mortgages pre-December 2022? Seems unfair for mortgage-holders post-2022. Thank you.
From Fiona
A: The mortgage interest tax credit has been extended for a further two years – albeit at a reduced rate in 2027.
However, to be eligible, you still need to have had a mortgage with a balance of between €80,000 and €500,000 at the end of 2022. There has been no change there.
For those who are eligible, it is worth up to €1,250 a year, although that figure will be halved to €625 in 2027 as the scheme is phased out. – DC
Q: On the relief for benefit-in-kind (BIK) on electric vehicles on open market value (OMV) that was given last year of €35,000 which was to reduce to €20,000 in 2026, has this been scrapped in place of the €10,000 announced or is the €10,000 in addition to the €20,000 that was mentioned last year?
From Mark
A: The EV OMV relief of €20,000 for 2026 remains in place. The announcement in the budget is an additional relief to extend the universal reduction to OMV for cars in categories A to D (which includes EVs) and all vans. The relief will remain at €10,000 for 2026, €5,000 for 2027, and €2,500 for 2028. – BP
Q: Are there any changes to how standard fund thresholds (SFTs) are calculated or to allowed SFT fund values?
From Tony
A: Pensions were notable by their absence from the budget day speeches apart from the €10 increase in State pensions and a passing mention of auto-enrolment.
There was certainly no change to the €2 million SFT – the upper limit on the size of a pension fund that can benefit from tax relief – or how it is calculated for those in defined benefit schemes (especially in the public service) where their pension is determined by years of service and their salary. – DC
Q: I have paid €3,000 each for my two university students for this academic year. Will I get reimbursed automatically? How much?
From Bobby Cogan
A: Many people pay the third level registration fee in stages and will see the impact of the new €500 cut in the fees as they make their remaining payments. Those, like yourself, who paid the full fee upfront are eligible for a refund.
Some colleges organise that automatically; for others, you may need to apply. My advice is to contact the third level institutions attended by your two children to see what arrangements they are putting in place. – DC
Q: Any changes to the age limit for free GP visits for children?
From Orla
A: No further expansion of the free GP scheme was announced this time around. The focus instead was on providing more hospital and nursing home beds and more hours of home care. – DC
Q: Is the €10 increase in the state pension per person? I.E. will a couple receive an increase of €10 or €20?
From Conal O’Sullivan
A: There will be a €10 increase in the weekly state pension per person from January. Therefore a couple will receive an additional €20 each week.– JL
Q: Is the Back to Education Allowance also due the €10 raise as well the Christmas bonus? (My son has just returned to college after a few years on Jobseeker’s Allowance). Thank you.
From Michelle Keary
A: While the Back to Education allowance did not feature in the ministerial speeches, my understanding is that the rate it is paid at is determined by the payment you were on before moving to Back to Education.
In your son’s case, this was Jobseeker’s Allowance and, as that will go up by €10 from January, I expect your son’s payment will also rise at that point. – DC
Q: Will those currently in receipt of the Basic Artist Income continue to receive it after expiration of the pilot scheme now that payment is made permanent?
From Denise Ryan
A: We’re waiting for full details of this new permanent scheme. As I understand it, the pilot scheme ends in February.
It would be surprising if the permanent scheme was up and running that quickly – the talk seems to be of a September application date – so the question is whether existing beneficiaries will continue to receive payment and also whether they will be automatically transitioned to the new permanent scheme or will have to apply again.
Hopefully, there will be some clarity emerging from the Minister for Culture Patrick O’Donovan. – DC
Q: Any increase in home retrofit grants?
From Aisling
A: No mention was made of improved grants for people undertaking home energy retrofitting projects.
There was an extension of income tax relief for landlords on retrofitting expenses and an additional €140 million put in place to fund the retrofitting of social housing, but that was it. – DC
Q: The Entrepreneurial Relief threshold is being increased to €1.5 million. Does that mean a company owner retiring from the business can take that amount tax free before paying tax (capital gains tax?) on the remainder?
From John Wallace
A: The Minister announced that the lifetime limit for which revised Entrepreneur Relief can be claimed will increase from €1 million to €1.5 million from January 1st.
The relief provides a reduced capital gains tax rate of 10 per cent to lifetime gains up to €1.5 million arising from the disposal of qualifying business assets. This provides an additional tax saving of €115,000. – JL
Q: Is there any increase to stamp duty?
From Aodhbaird
A: There were no increases to stamp duty rates announced in the budget. A new exemption has been introduced which will apply to purchases of listed shares in Irish companies with market capitalisations of less than €1 billion.
We have to wait for the Finance Bill to see how they are going to apply the €1 billion test as market capitalisation constantly changes.
The Residential Development Stamp Duty Refund Scheme, which applies to the purchase of development land which is subsequently developed for residential properties, has been extended.
Also some farming stamp duty reliefs were extended in the budget such as Young Trained Farmers Relief, and the Farm Consolidation Relief. – BP
Q: Is there a change to child benefit?
From Ann
A: There was no change announced in the rate of child benefit. This might have something to do with the mooted second tier child benefit that is currently being considered by the Department of Social Protection.
Minister Calleary has said he expects that to feature in next year’s budget as part of a move towards more targeted supports. – DC
Q: I receive a household benefits package where I receive about €33 a month for fuel. It failed to go up in 2025. Why hasn’t the Government increased this amount whilst those receiving the fuel has been increased?
From John
A: The amount of the fuel allowance has increased – or at least it will. From January 1st, it will be paid at €38 a week, up €5 a week on the current payment. As you say, it is some time since it was last increased – again by €5 back in November 2021.
As you have noted, the allowance will also be extended to recipients of the working family payment. – DC
Q: What new benefits were given to landlords in this budget?
From Jim
A: Some targeted measures were introduced. Firstly, for corporate landlords, an exemption was introduced in respect of profits associated with Cost Rental income. For private landlords, the deduction for retrofitting has been extended for a further three years.
This relief provides for a deduction for landlords against rental income for certain retrofitting expenses on rented residential properties.
The relief will also now be allowed to be credited in respect of the year in which the expenditure is occurred and the number of properties for which landlords can claim the relief is being increased from two to three properties. – BP
Q: Have there been any changes to the inheritance tax regime?
From Ray O’Higgins
A: The budget contained no announcements on any changes to Capital Acquisitions Tax. It is possible that changes could be introduced in the forthcoming Finance Bill, which is due to be published in the coming weeks, so we will need to wait and see. – JL
Q: Will the eight year deemed disposal on exchange-traded funds (ETFs) be abolished?
From John Conboy
A: The minister gave no indication as to whether the deemed disposal rule for ETFs will be retained or abolished. He has committed to publish a roadmap early next year setting out the plans to simplify and update the taxation of these investments. We will need to monitor developments in this space. – JL
Q: Was there any mention at all of a second tier of child benefit payment? Did the Minister mention why they didn’t go ahead with it this year?
From Catriona Lawlor
A: There was no mention in the budget speeches about a second tier child benefit payment.
The Minister for Social Protection, Dara Calleary, had flagged that well ahead of the budget, saying last month that work on the detail of such a scheme was being done by his department but would not be complete in time for this year’s budget.
At the time, he said he expects to bring forward such a scheme by this time next year. – DC
Q: What has been proposed to tackle dereliction?
From Neil O’Sullivan
A: A new Derelict Property Tax (DPT) has been announced in Budget 2026, which will replace the current Derelict Sites Levy. The policy objective of this tax is to incentivise owners of derelict properties to take action in relation to bringing the properties back to use.
We understand that the DPT will be legislated for in Finance Bill 2026. It is our understanding that local authorities will begin the process of identifying derelict properties in 2026 and a preliminary register will be published in 2027, with the tax coming into effect subsequently.
Currently, the Derelict Sites Levy is an annual levy of 7 per cent of the land’s market value. The rate of the DPT is yet to be determined, however it is envisaged that the tax rate would not be lower than the current 7 per cent rate. – BP
Q: Has the pension increased? When do fuel allowance payments start?
From John Kelly
A: There will be a €10 a week increase in the State pension from January. The fuel allowance also rises – by €5 to €38 per week – from January.
The Government has also extended eligibility for the fuel allowance to those receiving the Working Family Payment. They will only get the allowance next March but it will be backdated to January.
More generally, the 2025/2026 fuel allowance season has already kicked in. Weekly payments started on September 22nd and will run for 28 weeks until April 5th next year. – DC
Q: How is this affecting EV drivers?
From Eve
A: The main benefit is that they will not be hit by the impact of higher carbon taxes on petrol and diesel while also benefitting from the extension of the lower 9 per cent VAT rate on electricity to the end of 2030.
Otherwise, if your EV is a company car, you will benefit from the extension of relief under the benefit in kind regime. The €5,000 VRT relief on the purchase of a new EV will also be extended for one year to the end of next year. – DC
Q: Dominic Coyle writes that the reduction to 9% of the VAT rate on apartments will be passed on to the buyer. My question is, how can a journalist with his years of experience be so bloody naive?
From Jim Daly
A: Thanks Jim. I’m fairly sure that what I said was that the intention was that it will be passed on to the buyer. Otherwise, apartments are no more affordable going forward than they have been. Whether that actually happens remains to be seen. – DC
Q: As a full-time single worker in their late 20s, what measures are expected to benefit myself from Budget 2026?
From Carol
A: Very unusually, there really is nothing in the budget this time around for most people unless they are in receipt of welfare.
Your universal social charge will fall marginally as a result of the widening of the 2 per cent band but, given that the difference is just €13.18 over the course of a year, you’ll hardly notice it.
And that will be more than offset with the higher PRSI rate that kicked in at the start of this month – with another PRSI rate rise due next October.
That aside, if you are buying an apartment, that might have become more affordable with the new lower rate of VAT but otherwise, you will see little benefit and, with wages rising, your tax bill next year will rise rather than fall. – DC
Q: Families on working family payment can now claim fuel allowance. When does that come into effect?
Can it be claimed for 2025/2026 or is it going to be 2026/2027 September to April?
From John
A: It was announced in the budget that families on the Working Family Payment can now qualify for the fuel allowance. We understand that this measure will be implemented in March 2026 but backdated to January 2026. – BP
Q: Has there been an extension to the €400 annual tax exemption on micro-generation which was due to end in December 2025?
From Declan Conroy
A: Yes, the income tax disregard of €400 for income received by households who sell electricity from micro-generation back to the grid has been extended for a further three years to the end of 2028. – BP
Q: Is there any change to the room-to-rent scheme threshold in this budget?
From James Carr
A: There were no changes announced in the budget to the rent-a-room scheme. This scheme provides that rental income of up to €14,000 per annum can be earned tax free if you rent out a room in your home. – BP
Q: Have any changes to the deemed disposal rule or taxation of exchange traded funds (EFTs) been announced?
From James Ryan
A: The tax rate on ETFs will be reduced from 41 per cent to 38 per cent.
There is no specific mention of any changes to the deemed disposal rule but the Minister has committed to the publication of a roadmap early next year setting out the intended approach to simplify and adapt the tax rules for such investments. So there may be something in this report. We will need to wait and see. – BP
Q: Will there be increase in working family payment and will they be eligible for the fuel allowance?
From Michelle
A: The amount you receive under the working family payment will increase as a result of a €60 per week rise in the income limit for all families. As of now, a family with one child can earn €705 a week. That will move to €765 a week or €39,780 a year.
If you have two kids, the figure will go from €806 a week to €866, or €45,032 a year. The weekly income figure rises with each additional child up to €1,472 a week for families with eight or more kids. That last group will see their weekly income limit rise to €1,532, or €79,664 a year.
Any income tax, PRSI, universal social charge (USC) or pension/superannuation contributions are deducted from your gross family earnings before assessing if your family income meets the criteria. – DC
Q: Has there been any change to the Drug Payment Scheme fee of €80 per month?
From Sinead
A: No changes to the Drug Payment Scheme were announced in the budget. Therefore, we assume that individuals and their families will pay a maximum of €80 per month for approved prescribed drugs, medicines and certain appliances. – JL
Q: What are the changes to inheritance tax and reliefs?
From Mait
A: Unfortunately there were no changes to Capital Acquisitions Tax (CAT), also known as Gift Tax and Inheritance Tax. There may be some changes in the Finance Bill, which is due to issue in the next few weeks, so keep an eye on this. – BP
Q: Has there been a reduction in college fees, and any relief for parents paying college accommodation?
From Charlie
A: Yes, from January 1st, the annual student contribution fee will reduce from €3,000 to €2,500 applying to the current academic years for all eligible students.
An individual can claim tax relief at the standard rate of tax, currently 20 per cent on qualifying fees which have been paid for third level education courses. The maximum amount which can be claimed is €7,000 per course, per person, per academic year.
Each tuition fee claim is currently subject to a single disregard amount of €3,000 for a full-time student and €1,500 for a part-time student each year. If a parent pays college fees for more than one student, this disregard amount will only be deducted from their claim once.
We will need to see the detail in the Finance Bill as to how the reduction in the annual student contribution could impact the single disregard amount for tuition fees tax relief. – JL
Q: How much has widow’s pension increased by?
From Ann Ambrose
A: The widow’s pension is no more; it is now called the Bereaved Partner’s Pension and it has increased alongside other welfare payments. The means tested non-contributory rate will move to €254 a week, up €10.
For those in receipt of the contributory bereaved partner’s pension, the rate for people under the age of 66 moves to €259.50 a week. That rises to €299.30 a week for people aged between 66 and 80 and to €309.30 a week for people over the age of 80.
In all cases, that is a rise of €10 a week on current rates. – DC
Q: Is the VAT reduction on new build apartments passed on to buyers? I’m currently in the process of buying one.
From Kevin
A: That is certainly the intention of Government. While there is some speculation that the lower VAT on food, catering and hairdressing may go to the providers, the understanding with lower VAT on apartments is that it makes the price of these apartments more affordable for purchasers.
The lower VAT rate comes in from today after TDs voted the issue through last night so it should see you benefit if you are currently buying one. The measure should knock close to €20,000 off the price of a €500,000 apartment. – DC
Q: Is there any change to the income threshold for Carer’s Benefit?
From Martina
A: There is but, as usual, you will be waiting some time to see it. The income disregard for people applying for or in receipt of carer’s benefit will rise from its current level of €625 a week for a single person or €1,250 for a couple to €1,000 a week for a single person or €2,000 for a couple.
That is quite a jump from the figure of €450/€900 a week that applied as recently as June of this year. However, the new rates will not kick in until July of next year. – DC
Q: Has there been any change to the benefit in kind (BIK) on electric passenger vehicles?
From Colm
A: Yes there are some changes to the BIK rules for electric vehicles. The temporary universal reduction to the original market value of cars in categories A to D and to all vans, which reduces the amount of BIK payable, is being extended on a tapered basis for three further years (€10,000 for 2026, €5,000 for 2027 and €2,500 for 2028).
In addition, the tables used to calculate BIK liabilities on employer provided cars are being amended to incorporate a new category for vehicles with zero emissions.The new A1 category introduces reduced BIK rates for electric vehicles, with rates of 6 per cent to 15 per cent, depending on business mileage. – BP
Q: What are the new rates for Inheritance Tax Cat A, B and C?
From Mary Dineen
A: There were no changes announced to the gift/inheritance tax rates or to the CAT tax free thresholds in the budget. Therefore, the current CAT rate of 33 per cent remains.
The Group A tax free threshold remains at €400,000, the Group B threshold at €40,000 and the Group C threshold at €20,000 for any gifts or inheritances received on or after October 2nd, 2024. However, changes to the CAT rate and/or tax free thresholds could be announced in the Finance Bill. – JL
Q: Is the proposed increase in the housing budget a 20% increase in expenditure or does it take into account the reduced VAT receipt on new apartments?
From Séamus Bairéad
A: While the overall budget for housing is up 20 per cent, the capital expenditure side is up by a larger 21.3 per cent to €7.23 billion.
That figure covers a lot of things – such as funding the construction of thousands of social and starter homes, urban regeneration projects, an energy retrofit programme and the adaptation of the homes of older people with a disability.
It does not include the cost to the State of the VAT reduction the Minister announced on the sale of new apartments. That is expected to cost the exchequer a further €250 million next year, and €390 million a year after that up to the end of 2030 when that VAT measures is due to expire. – DC
Q: Is it expected that deemed disposal on exchange traded funds will be permanently removed? I am seeing conflicting reports in the last 24 hours.
From Fergus Morton
A: The Minister has hedged his bets on this one. All he committed to was publication of a “road map” early next year “setting out my intended approach to simplify and adapt the tax framework to encourage retail investment”.
This, he said, was to “facilitate due consideration of the Funds Sector 2030 report” which was published a year ago. We’ll have to await that road map to see if deemed disposal for exchange traded funds is to be removed. – DC
Q: Will the tax rate be reduced from 41 per cent to 33 per cent for investments and savings through life companies?
Considering the current lack of financial education, shouldn’t individuals be encouraged rather than penalised for seeking expert guidance to invest their money?
From Valentina
A: The Minister announced in the budget that the rates of taxation that apply to Irish domiciled funds, life assurance policies and offshore funds will be reduced from 41 per cent to 38 per cent.
He mentioned the intention to publish a roadmap early next year setting out the intended approach to simplify and adapt the tax rules with such investments. This news is very positive but we will need to wait to see the detail in the report next year. – BP
Q: Will there be difference in USC and PRSI?
From Anonymous
A: Yes, in light of the increase of the minimum wage to €14.15 per hour, the 2 per cent USC rate band ceiling will increase by €1,318 to €28,700 from January 1st.
In addition, the reduced USC rate of 3 per cent will continue to apply for individuals who hold a full medical card and earn less than €60,000 per year until December 31st, 2027.
Employee and self-employed PRSI will increase from 4.1 per cent to 4.2 per cent and employer PRSI will increase from 11.15 per cent to 11.25 per cent effective from 1 October 2025. – JL
Q: Will there be anything for pensioners living alone?
From Yvonne Alvarez
A: Pensioners in receipt of the State pension will receive an extra €10 a week to €299.30 if they qualify for a full contributory State pension. The means tested non-contributory State pension also increases by €10 to a maximum weekly payment of €288. There is no change to the Living Alone Allowance, which remains at €22 a week. – DC
Good morning and welcome to our live Budget 2026 Q&A.
Cuts in VAT and increased public spending in a range of areas left no room in Tuesday’s budget for a repeat of recent giveaways to middle-income workers.
Many people who benefited by €2,000 to €3,000 in last year’s budget from tax changes and “one-off” cash giveaways will see no benefit from the package of measures announced by Minister for Finance Paschal Donohoe and Minister for Public Expenditure Jack Chambers.
Here we are going to dig down into the detail of what it all means for you with Dominic Coyle, Deputy Business Editor at The Irish Times; Beryl Power, tax director at PwC Private Clients; and Jacinta Lynch, tax senior manager at PwC Private Clients.
