Personal tax Archives

Budget 2026: Strategic Certainty for Irish Business in Uncertain Times

News & Publications, Tax, VAT, Corporate tax, Personal tax, Research & Development, Global Mobility

Budget 2026 was delivered by Minister Paschal Donohoe with a clear commitment of investing in the future to safeguard Ireland’s economic stability. For business leaders, the message is one of prudent optimism: the government is balancing fiscal discipline with targeted supports to help enterprises navigate global volatility and seize new opportunities.

Economic Resilience and Fiscal Prudence

Minister Donohoe’s speech underscored Ireland’s robust economic fundamentals – record employment, robust growth in domestic demand, and a healthy public finance position.

Budget surpluses are being used to reduce public debt and build up the Future Ireland Fund and the Infrastructure, Climate and Nature Fund, projected to reach €24 billion by the end of next year. This approach is intended to shield the economy from external shocks and provide a buffer for future demographic and structural challenges.

Housing and Infrastructure: Unlocking Growth

For those looking to buy a home, the government’s focus on housing and infrastructure is particularly significant. Over €5 billion in capital investment is earmarked for housing delivery in 2026, with reforms to planning and design aimed at boosting supply and affordability. Key measures include:

VAT reduction on apartment sales (from 13.5% to 9%) to stimulate construction and address viability gaps.
New Derelict Property Tax and extension of the Residential Development Stamp Duty Refund Scheme to incentivise regeneration and development.
Additional funding for Home Building Finance Ireland, including €200 million for SME builders.

These initiatives are designed to ease housing pressures, support workforce mobility, and enhance Ireland’s attractiveness as a location for investment.

Taxation and Business Supports

Budget 2026 introduces several measures to support enterprise competitiveness and innovation:

Reduced VAT for hospitality and hairdressing to 9% effective July 2026, supporting over 150,000 jobs.
Enhanced R&D tax credit, increased to 35%, and improvements to the Key Employee Engagement Programme (KEEP) to help SMEs attract and retain talent.
Revised Entrepreneur Relief, raising the lifetime gains limit from €1 million to €1.5 million, and a new stamp duty exemption for SMEs and start-ups trading on regulated markets.
Participation exemption and interest regime reforms to simplify the tax code and align with international best practice.

The government is also investing in digitalisation, green transition, and access to finance, with continued support for the Digital Games Tax Credit, Accelerated Capital Allowances for energy-efficient equipment, and targeted grants for sustainability projects.

Labour Market and Cost Pressures

With the minimum wage rising to €14.15 per hour and ongoing cost-of-living challenges, the Budget includes adjustments to the Universal Social Charge (USC) to ensure low earners are not penalised. The increased minimum wage though will add to the cost pressures that many small businesses are operating under.

While the extension of the Foreign Earnings Deduction (FED) and Special Assignee Relief Programme (SARP) and supports international mobility and export growth, the increase in the minimum entry salary threshold for the latter to €125,000 is restrictive.

Climate and Sustainability

Budget 2026 maintains Ireland’s commitment to climate action, with increased carbon taxes, extended supports for retrofitting and electric vehicles, and incentives for renewable energy generation. Revenues from carbon taxes are ring-fenced for social welfare and just transition measures, ensuring a balanced approach to sustainability.

Conclusion: Certainty, Competitiveness, and Confidence

For now, the days of “one-off’’ relief measures and ‘’give away budgets” are over. Budget 2026 is not about satisfying short-term objectives. People are now being asked to commit to strategic choices that will sustain Ireland’s economic success and competitiveness and enable a more balanced return for all in the future. That’s the theory anyway!

View the Budget 2026 highlights here.

October 7, 2025/by Alison Bourke

Budget 2026 Highlights

News & Publications, Tax, VAT, Corporate tax, Personal tax, Research & Development, Global Mobility

Minister for Finance, Paschal Donohoe delivered the final Budget today, 7 October 2025. Below we outline the highlights of Budget 2026.

Personal Tax

No changes announced to Income Standard Rate Bands with the single band remaining at €44,000, with the married single earner at €53,000, and the married dual income band at €88,000.
Personal, PAYE, Earned Tax credits: similarly no changes to personal tax credits.
Rent Tax Credit: while remaining at €1,000, a commitment to increase over time was announced along with an extension of the credit to the end of 2028.
Small change to the second rate-band of Universal Social Charge to €28,700. The concession for full medical holders earning less than €60,000 is to be extended by two further years.
Mortgage Interest Tax Relief extended for a further two years with a reduced value applying in the final year.

Enterprise/SMEs

Entrepreneur Relief: the lifetime threshold increases to €1.5m from 1^st January 2026.
Key Employee Engagement Programme (KEEP) is being extended to the end of 2028.
The Special Assignee Relief Programme is being extended for a further five years, with the minimum qualifying income increasing to €125,000 to ensure the relief is appropriately calibrated. Measures to be introduced in the Finance Bill to streamline the administration process.
Foreign Earnings Deduction extended for a further five years.
The Research & Development Tax Credit is increasing from 30% to 35% and first year payment threshold increased from €75,000 to €87,500.
Participation Exemption extended to jurisdictions where no refundable withholding taxes apply.
Subject to commencement orders, the Section 481 Film Tax Credit is being enhanced to provide for a new 40% rate of relief for productions of at least €1m qualifying expenditure on visual effects work.
Digital Games Tax Credit extended to 2031, however this is subject to a commencement order.
A joint Department of Finance and Revenue along with public consultation on Withholding Taxes.

Housing Measures

A further opportunity for exemption in 2026 from the Residential Zoned Land Tax (RZLT) if landowners seek to have their lands re-zoned.
Exemptions or reductions in Corporation Tax on profits from the sale of some apartments, included in Cost Rental Schemes.
An enhanced Corporation Tax deduction for construction and conversion of apartments – from 8 October to end of 2030.
A Derelict Property Tax will replace the site levy which currently is charged at 7%. No rate yet announced but it is anticipated that it will not be less than 7%. Preliminary registers of dereliction will be published in 2027, with the tax being applied soon afterwards.
VAT rate of 9% on sale of new apartments from 8 October.
Residential Development Stamp Duty Refund Scheme is to be extended to 2030.
Living City Initiative extended to 2030 in special regeneration areas, an increase scope of properties for those constructed prior to 1975 and extending to “over the shop” properties. Five new regional centres being introduced into the initiative. Finally, relief is being increased from €200,000 to €300,000.
The deduction for Pre-Letting Expenditure from rental income will be extended for a further three years, to the end of 2030. The deduction is capped at €10,000 per property.
Home Building Finance Ireland to have additional funding of €200m to support home builders.

VAT

In addition to the changes applying to the sale of new apartments, the reduced 9% rate will apply from 1 July 2026 for food catering businesses and hairdressing.
The 9% VAT rate for Gas and Electricity supplies is extended to the end of 2030.
Revenue are to introduce a phased role out of domestic electronic invoicing.

Agriculture

The four Agricultural Tax Reliefs pertaining to Stamp Duty and Capital Gains Tax have been extended to 2029. The Farm Restructuring Relief is being expended to include woodlands and forestry.
The Extended Capital Allowance regime for slurry storage facilities has been extended for a further four years.

Climate

The Carbon Tax increase to €71 per tonne of CO2 emitted applies to auto fuels from 8 October and to all other fuels from 1 May 2026.
VRT Relief on electric vehicles extended for a further one year.
The Universal Relief on the OMV on electric vehicles will remain at €10,000 in 2026 and taper off to €5000 in 2027, €2,500 in 2028 and cease in 2029.
Accelerated Capital Allowances on Energy Efficient Equipment extended for a further five years to end of 2030.
Income tax disregard of €400 for income received by households who sell electricity to the grid extended to 2028.

Other Measures

The rate of tax on offshore funds and foreign life assurance products is to be reduced from 41% to 38%.
The bank levy will remain for a further year.
A separated Pool Betting charge to be announced after consultation in Budget 2027.
Excise Duty on tobacco products will increase by 50 cent from 8 October.

Read our tax team’s analysis of Budget 2026.

October 7, 2025/by Alison Bourke

Tax Guidance for Social Media Influencers: What You Need to Know

News & Publications, Personal tax

With an increase in those earning income from social media and promotional activities, the Revenue Commissioners have issued a manual to reiterate that such income is liable to tax based on the application of ordinary tax rules.

Types of Taxable Income

Income derived from social media or promotional activities is chargeable to tax, even in circumstances where the activity is conducted on a casual basis only and is not the individual’s or company’s main business or main source of income.

Such income can be in the form of subscriptions, advertising, sponsorship, brand ambassadorship or endorsement fees and may be monetary or non-monetary in nature. Where the receipt is in non-monetary form, i.e. goods/services, then the value of such must be determined and is regarded as income.

Determining If Social Media Activities Constitute a Trade

Whether the profits or gains derived from social media or promotional activities arise in the course of a trade is a question of fact, having regard to the particular facts and circumstances of each case and also having regard to the ‘badges of trade’ and caselaw.

Example: Full Time Influencer

Orla is an adventure travel enthusiast. She is a full-time travel blogger and regularly posts content on various social media channels. She receives income from sponsored blog posts and affiliate marketing. Orla’s social media activity is carried out on an ongoing, frequent basis with the intention of making a profit. Her activity has the characteristics of a trade. She is obliged to return the income as Case I income.

Deductible and Non-Deductible Expenses

In computing the profits assessable to tax, certain expenses may be deducted provided they are:

Revenue and not capital in nature,
Incurred wholly and exclusively for the purposes of the trade, and
Not specifically disallowed in law.

When considering if an expense was incurred wholly and exclusively for the purposes of the trade, one should be aware that if the expense has both a business and non-business purpose then the entire expense is disallowed, e.g. clothes. Similarly, hair and make-up expenses are also disallowed.

If carrying on a trade, a deduction for capital expenses, in the form of capital allowances, may be available. However, if the income is derived from ad-hoc activities, then no deductibility is permitted for capital expenses.

Example: Casual Influencer

John is a full-time software developer who enjoys mountain hiking in his spare time. He pays an annual subscription to an online map and trails app. He posts reviews of trails and landscape photographs online on social media channels one or two times a year. People with occasionally contact John to purchase a photograph he’s posted on social media. He is obliged to declare the profit from the online activities. When calculating the taxable profit from the activity, he is allowed to deduct the costs of print, post and stationery incurred from sales of his photographs. The costs of the annual subscription to the hiking app or the cost of hiking clothing is not deductible, as the costs are a personal cost and not incurred directly in the provision of the social media content. As John is not carrying on a trading activity capital allowances, e.g. on photographic equipment, are not available.

Business Structures and VAT Considerations

Such activities may be carried on by a person through a sole trade, partnership or a company.

In addition to Income Tax and Corporation Tax, persons carrying on a business need to be aware of their obligations to register and account for VAT should the value of their supplies exceed the relevant registration thresholds.

For further information on tax guidance for social media influencers, please contact us.

August 21, 2025/by kimmc

Transborder Workers’ Relief: A Guide for Irish Residents Working Abroad

Global Mobility, News & Publications, Personal tax

With the rise in cross-border employment, Irish tax residents working abroad may qualify for a significant tax relief known as Transborder Workers’ Relief. This article outlines the key eligibility criteria and how the relief is calculated.

What is Transborder Workers’ Relief?

Transborder Workers’ Relief is a tax relief available to individuals who are resident in Ireland but work and pay tax in another country. The relief effectively removes the earnings from a qualifying foreign employment from liability to Irish tax, provided that foreign tax has been paid and is not refundable.

Who Qualifies?

To claim the relief, the following conditions must be met:

You must be resident in Ireland for tax purposes,
You must work full-time in another country that Ireland has a double taxation agreement for a continuous period of at least 13 weeks,
You must pay tax in the foreign country on your employment income and are not due a refund of the tax paid,
You must be present in Ireland for at least one day for every week worked abroad.

It is important to note that the relief does not apply if the individual receives Seafarers’ Allowance, Foreign Earnings Deduction (FED), or split year treatment. Additionally, one cannot claim relief if they or their spouse or civil partner are proprietary directors of the company for which they work abroad.

How is the Relief Calculated?

The relief is calculated using a formula that determines the “specified amount” of Irish tax that can be relieved:

Specified Amount = (Total Irish Tax Due × Non-Foreign Income) ÷ Total Income

This means that the relief only applies to the portion of Irish tax attributable to the foreign employment income. You will not receive any credit for foreign tax paid if you qualify for transborder relief.

How to Apply

The relief is claimed through the annual income tax return (Form 11). Supporting documentation, such as foreign payslips, tax certificates, and travel records, may be required by Revenue.

Conclusion

Transborder Workers’ Relief can offer significant tax savings for Irish residents working abroad, but it requires careful planning and accurate reporting. If you think you may qualify, our tax team at Crowleys DFK is here to help.

July 17, 2025/by kimmc

Residential Premises Rental Income Relief (RPRIR)

News & Publications, Personal tax

The Residential Premises Rental Income Relief (RPRIR) was introduced in Budget 2024 to support the Irish rental market by incentivising landlords to retain properties for long-term letting. This article outlines the key features of the relief, eligibility requirements, and how landlords can benefit.

What is RPRIR?

RPRIR is a tax credit available to landlords who rent out qualifying residential properties. The relief is available from 2024 to 2027 and is designed to encourage continued participation in the rental market. The credit is valued at up to a maximum of €600 in 2024 and is set to increase in subsequent years.

Who Can Claim the Relief?

RPRIR is available to all individual landlords of ‘qualifying premises’. The relief is not available to companies or other entities such as trusts or partnerships.

Qualifying Premises:

A qualifying premises refers to a residential property owned by the landlord on 31 December in the year of assessment. The property must meet one of the following conditions:

1. It is occupied by a tenant:

under a tenancy registered with the Residential Tenancies Board,
let by the landlord to a public authority, or
subject to Part II of the Housing (Private Rented Dwellings) Act 1982, which pertains to formerly rent-controlled tenancies;

2. Alternatively, if the premises is not occupied by a tenant, the landlord must be actively marketing the property for rent.

In cases where RPRIR is claimed based on active marketing for rent, the landlord must provide evidence to support this claim, such as copies of advertisements for the letting.

Other Eligibility Criteria:

To qualify for RPRIR, a landlord must, on 31 December of that year, be:

compliant with their LPT obligations in respect of all qualifying premises, and
hold a valid Tax Clearance Certificate.

Conclusion

Residential Premises Rental Income Relief offers a valuable opportunity for landlords to reduce their tax liability.

For further guidance or assistance with your tax return, please contact us.

July 3, 2025/by kimmc

Understanding the Residential Zoned Land Tax (RZLT)

Personal tax, News & Publications

What is the RZLT?

The Residential Zoned Land Tax (RZLT) was first introduced in the Finance Act 2021 and aims to increase housing supply by activating zoned and serviced residential development lands (including mixed-use lands) for housing. It is annual self-assessed tax, effective from 2025, calculated at 3% of the market value of applicable land.

The tax applies to land zoned for residential use and adequately serviced since 1 January 2022. Some properties are exempt from RZLT, such as existing homes that already pay the Local Property Tax (LPT). These properties may still appear on local authority maps.

Local authorities are required to prepare and publish maps that identify the land within the scope of RZLT. These maps are updated annually on 31 January.

Who is required to register for RZLT?

RZLT is a self-assessed tax. Landowners whose land appears on the annually updated map must register for RZLT. Residential properties that pay the Local Property Tax (LPT) are exempt, unless their garden or yard is larger than 0.4047 hectares (one acre). In such cases, registration is required, but no tax will be due.

You can register through the Revenue Online System (ROS) or MyAccount. Once registered, Revenue will assign a unique identification number to your site. Non-compliance may result in penalties.

Valuation

RZLT is self-assessed, based on the market value of the site on the valuation date. This means the landowner must initially determine and declare the site’s market value to Revenue. Revenue guidance suggests the following resources which may be helpful when determining the value position:

Information from local estate agents or valuers;
Commercial property sales websites;
Newspapers or other media sources.

Revenue has emphasized the importance of comparing similar sites when using the suggested resources. These comparisons should consider factors like type, size, location, zoning, and planning permission status. Revenue may engage an expert to help determine the land’s value.

Key Dates for Landowners

27 January 2025: Registration for RZLT is live and available through Revenue Online System. Revenue have published guidance for the registration system.
31 January 2025: Final maps are published by local authorities.
01 February 2025: RZLT becomes chargeable for land that met the criteria on 01 January 2022 or during 2022.
23 May 2025: Deadline for submitting the annual RZLT return and payment. This return has to be submitted even if a deferral is being claimed.

Pay and File Obligations

An annual return must be submitted to Revenue, and any tax liability paid by 23 May each year, starting in 2025.

The RZLT legislation provides for surcharges and interest for non-compliance including late payment interest, failure to make timely returns and undervaluation of land. A penalty of €3,000 will apply where the landowner does not register for RZLT where required to do so.

Landowners are advised to maintain detailed records to allow Revenue to verify the RZLT due.

In certain circumstances, RZLT payment may be deferred.

2025 Rezoning Submission

Farmers can seek an exemption by requesting their land be rezoned to reflect its agricultural use.

Finance Act 2024 provides an opportunity for a rezoning request to be submitted to the relevant Local Authority in respect of land which appears on the revised map for 2025 published on 31 January 2025.

Where such a rezoning request is made, an exemption from RZLT may be claimed for 2025 where certain conditions are met.

To claim this exemption, you must register for RZLT and file a 2025 RZLT return by 23 May 2025.

Contact Us

If you require further guidance on the RZLT, please contact us.

May 6, 2025/by Alison Bourke

Employee Share Incentive Schemes

Corporate tax, Personal tax, News & Publications, Tax

Employee share incentive schemes can serve as an effective alternative to bonuses. They not only offer tax savings for employees, but also promote greater participation and loyalty within the company. There is also a tax saving of employer PRSI for the employer where remuneration is by way of equity participation when compared to cash or other benefits.

Depending on the type of scheme, employees might need to hold onto the shares for several years before they can enjoy the tax benefits.

One of the key considerations when implementing a share plan is the valuation of the shares. Accurate valuation from the outset is crucial to ensure the proper taxation of the awards, such as growth shares and restricted shares.

In this article we consider the following type of employee share incentive schemes:

Share option schemes
Restricted Stock Units (RSUs)
‘KEEP’ share option schemes
Growth/Flowering Shares
Restricted Shares

1. Share Options

This is an option granted by a company to its employees to subscribe for shares at a pre-determined price at some point in the future. The option must be exercised in order for the employee to get beneficial ownership of the share. Prior to exercise, the employee does not have any rights relating to the shares. The employee pays taxes on any profit made when they eventually exercise the shares. There’s a deadline to exercise this option (usually 7 years) to avoid tax issues on granting. The burden for withholding tax is now placed on the employer for all options exercised on or after the 1st of January 2024. CGT is chargeable on any subsequent disposal of the shares.

2. Restricted Stock Units (RSU’s)

This scheme awards free shares to employees, and usually vest after a set period (can be time-based or performance-based). Employees are taxed on the market value of the shares at vesting, similar to a salary, and the employer withholds the tax. There are no tax implications at the grant. Conditions outlined in a plan document must be met before shares are issued.

3. Key Employee Engagement Programme (KEEP)

This is a tax advantageous share option scheme introduced specifically for certain qualifying SME companies for their employee or directors. Employees do not pay taxes when they exercise the option to buy shares. Instead, they pay capital gains tax (33%) when they eventually sell the shares. There are several conditions to be satisfied which can make KEEP challenging, including that options must be granted at market value. However, due to the tax benefits, KEEP is worth considering when deciding on what plan to utilise.

4. Growth/Flowering Shares

Growth shares are a special class of ordinary shares that generally have a low or nil value until a certain target or hurdle is reached by the business. The growth share is subject to income tax, USC and PRSI on award and must be valued for tax purposes. This type of share award can be attractive where the owners wish to share in future growth in the value of the company. CGT will be payable on any growth in value.

5. Restricted Shares

Restricted shares are subject to income tax, USC and PRSI at the date of award. There is an abatement on the taxable value available under Section 128D which reduces the taxable value by 10% per year of restriction up to a maximum of 60%. There is a claw back of income tax if restrictions lifted or varied before the end of the restricted period. CGT will be payable on any growth in value.

If you are considering implementing an employee share incentive scheme and require advice on choosing the right plan to implement, please do not hesitate to contact us.

February 20, 2025/by Alison Bourke