Budget 2026: Main Points for Irish Households & Businesses

The Irish Government’s Budget 2026 delivers a €9.4 billion package focused on cost-of-living relief, public investment, and targeted supports for individuals and businesses. Here’s what you need to know from Budget 2026:

Budget 2026 Take-Home Pay & Savings

Income Tax: No changes to income tax rates or bands for 2026.
Minimum Wage: Increases by €0.65 to €14.15/hour from January 2026. Full-time minimum wage workers will see about €1,345 extra annually before tax. Employers, especially SMEs, should note increased payroll costs (including PRSI, holiday pay, and auto-enrolment contributions).
USC: The 2% rate ceiling rises by €1,318 to €28,700, matching the new minimum wage. The USC concession for medical card holders is extended to the end of 2027.
Exit Tax: Drops from 41% to 38% on savings/investments.
Mortgage Interest Relief: Extended for two years (capped at €1,250 in 2025 and €625 in 2026).

PRSI & Tax Credits

PRSI: Will rise from 4.1% to 4.2% on 1 October 2025, increasing again to 4.35% in 2026 as part of the Government’s long-term pension funding strategy. The benefit from the USC band adjustment will be largely offset by the PRSI increase.
R&D Tax Credit: Jumps from 30% to 35%, with the first-year refund limit now €87,500.
Entrepreneur CGT Relief: Lifetime limit up from €1 million to €1.5 million (from January 2026).
Film Tax Credit: 40% relief for productions (€1m–€10m); Digital gaming tax credit extended by six years.

Social Welfare & Family Supports

State Pensions, Jobseeker’s, Disability: +€10 per week. No changes to private pensions.
Carer’s Allowance: Income thresholds up €200 (single) / €400 (couple); disregard now €1,000 / €2,000.
Child Benefit: +€8/week (under 12), +€16/week (over 12).
Working Family Payment: +€60 per week.
Fuel Allowance: +€5 per week, now includes Working Family Payment recipients.
Christmas Bonus: Double payment for long-term welfare recipients (excluding Child Benefit).

Pensions & Auto-Enrolment

My Future Fund: Auto-enrolment pension scheme launches 1 January 2026 for employees aged 23–60 earning over €20,000 annually who aren’t already in a pension. Contributions start at 1.5%, rising to 6% over ten years, matched by employers. For every €3 contributed, the State adds €1. Opt-outs are only allowed during set periods.
Employers: Must budget for rising contribution rates from 1.5% in 2026 to 6% by 2034.
State Pension: Increases by €10 weekly, bringing the Contributory Personal Rate to €299.30 per week in 2026.
Standard Fund Threshold: Rises from €2 million to €2.2 million in 2026, increasing incrementally to €2.8 million by 2029.

Housing & Property

Renters’ Credit: Extended to 2028 (€1,000 single / €2,000 couple).
Help to Buy: Extended, €1.2 billion for starter homes.
VAT on Apartment Sales: Cut from 13.5% to 9% (immediate effect).
Corporation Tax: New deductions/exemptions for apartment developments/conversions.
Derelict Property Tax: New 7% levy from 2027.
Living City Initiative: Extended to 2030, now includes “over-the-shop” and pre-1975 buildings.
Housing Budget: €11.3 billion, including €2 billion for social housing and €300 million for urban regeneration.

Health, Education & Childcare

Disability Services: +€500 million for placements, assessments, and staff.
RSV Infant Immunisation: New programme launches in 2026.
Department of Health Budget: €27.4 billion (+€1.5 billion), 3,370 new staff (220 acute beds, 280 community beds, 500 nursing home places, 300 mental health staff, 100 crisis clinicians).
Third-Level Fees: Permanent €500 reduction (now €2,500 per student).
SUSI Grant: Income threshold up €5,000 (to €120,000).
New Posts: 1,042 teaching positions, 1,717 new SNAs.
Capital Funding: €1.6 billion for 300 school projects.
Early Years & Childcare: €125 million extra, ~2,300 new places.

Business, Employment & Other Measures

VAT for Hospitality: Drops from 13.5% to 9% for food/beverages (from July 2026).
Stamp Duty: €1 billion market cap exemption for SMEs/start-ups.
Carbon Tax: Rises to €71/tonne (auto fuels now, other fuels from May 2026).
EVs: €5,000 VRT relief extended by one year.
Garda & Defence: 1,000 new Gardaí, 200 civilian staff, 11% Defence budget increase.
Excise: 50c increase on cigarettes; no change for alcohol.
Sports Funding: €3m for League of Ireland academies, €1.6m for intercounty GAA, IRFU support.
Agriculture: €85m for bovine TB control.
Future Revenue: Pool betting duty charge planned for Budget 2027.

Investment Tax Charges

Exit Tax: Reduced from 41% to 38% for Irish-domiciled funds, post-2001 Irish life policies, and offshore funds or foreign life policies based in EU, EEA or OECD treaty countries (including most ETFs). No change to the eight-year deemed disposal rule, though it’s recommended for review.
Roadmap: To support the Funds Sector 2030 Report, a roadmap will be published in early 2026 to simplify and modernize the retail investment tax framework.
DIRT & CGT: Remain unchanged at 33%. Corporate investors continue to pay 25% exit tax on non-trading investment income.
Stamp Duty: New exemption from the 1% Stamp Duty on acquisitions of shares in Irish registered companies with market capitalisation below €1 billion.

Tax Changes for Businesses

Entrepreneur Relief: Revised, with increased lifetime limit.
VAT Rate: Reduced 9% rate for food, catering, and hairdressing from July 2026.
KEEP: Key Employee Engagement Programme extended until end of 2028.
SARP: Special Assignee Relief Programme extended for five years, minimum income threshold up to €125,000 from 2026.
R&D Tax Credit: Increased to 35%, with a higher first-year payment threshold of €87,500.

Want to Know More?

If you’d like to discuss how these changes could impact your finances or business, learn more about our financial planning services or get in touch for a review.
For full details, read the official Budget 2026 summary on gov.ie.
Reach out to our team at 01 205 5600 or email .