- Restoration of a 100% tax deduction for interest expenses incurred on loans used to purchase, improve or repair residential property for rental purposes is a positive development for the sector. The removal of the restriction will be effective from 1 January 2019.
- Although future changes to the current Local Property Tax regime have been heralded, the introduction of a tax deduction for Local Property Tax paid on residential rental properties failed to materialise.
- An additional €4.6 million will be provided to the Residential Tenancies Board (RTB) in 2019, bringing its allocation to €11.5 million. This increase will help the RTB to enforce rent caps and expand its programme of rental inspections.
- The Government has also allocated a further €121 million to the Housing Assistance Payment (HAP) scheme to provide an additional 16,760 new tenancies in 2019.
- The Housing Agency will also receive additional funding of €2.8 million, bringing its funding for 2019 to €10 million. This additional budget reflects the Housing Agency’s expanded role in the delivery of housing supports and services.
- The Government has committed to a package of measures, with a particular focus on the development of social and affordable housing. This includes the contribution of €1.25 billion towards the construction, acquisition and leasing of 10,000 new social homes in 2019 and the creation of the Serviced Sites Fund to help local authorities deliver 6,000 affordable homes.
- No increase in the current rates of stamp duty has been announced.
- The Group A tax-free threshold, which applies primarily to gifts and inheritances from parents to their children, will be increased from €310,000 to €320,000. This increase applies to gifts or inheritances received on or after 10 October 2018.
- No change to mortgage interest relief.
- Housing Assistance Payment Scheme will increase by €149m.
- Funding for homeless services will increase by €18m to more than €116m.
- €750m is to be made available for commercial investment in housing finance.
- The level of stamp duty on commercial property transactions will rise from 2% to 6% from midnight last night
- The vacant site levy will increase from 3% in the first year to 7% in second and subsequent years.
- A new house-building entity to boost construction has been announced.
- Pre-Letting Expenses available for qualifying expenses up to end of 2021.
- The point at which an income earner attracts the higher rate of income tax will rise next year by €750 per annum.
- The entry point for single earners will increase from €33,800 to €34,550.
- The entry point to USC will remain at €13,000.
- The 2.5% USC rate will be reduced to 2% with the ceiling for the new rate increased from €18,772 to €19,372.
- The 5% USC rate will be reduced to 4.75%.
- A working group will be set up over the coming year to plan the amalgamation of the USC and PRSI over the medium term.
- The Earned Income Credit for the self-employed will rise by €200 to €1,150 a year.
- Reduction in seven-year period for owners to enjoy full relief from Capital Gains Tax to four years.
- USC entry level increased to €13,000
- Rate on income from €0 to €12,012 reduced to 1%
- Rate on income from €12,013 to €18,668 reduced to 3%
- Rate on income from €18,669 to €70,044 reduced to 5.5%
- Rate on income from €70,045 remains at 8%
- Increase in tax-free threshold for transfers between
parents and their children, from €225,000 to €280,000
- The Home Renovation Incentive is being extended until 31st December 2016.
- A revised Capital Gains Tax relief for entrepreneurs is being introduced from 1st January 2016 which will apply a reduced capital gains tax rate of 20% to the disposal in whole or part of a business up to an overall limit of €1 million in chargeable gains.
More information is available on the budget here
- 1% reduction in top income tax rate from 41% to 40%
- The CGT and CAT rates remain unchanged at 33%
- VAT rates unchanged at 9%, 13.5%, 23%
- Standard Rate Tax Band increased by €1,000 (single), €2,000 couple
- USC entry level increased to €12,012
- Water charges tax relief up to €500 at standard rate
- Pension levy .06% will end this year
- Home Renovation Incentive Scheme extended to landlords
- All new Irish incorporated companies will in future be Irish tax resident
- CGT relief for property acquired 7/12/11 – 31/12/2014 will end.
More details on the recent budget can be found here