Budget 2025 was delivered against the backdrop of continued pressures on household budgets, but also with one eye squarely on securing votes in the upcoming General Election by putting more money in taxpayers' pockets.
The raft of measures includes an increase in the entry point for the higher rate of tax, a reduction in USC, a number of increases in social welfare payments and several once-off payments to deal with the cost-of-living pressures.
The need to address capacity and infrastructure issues in the longer term in every area of the economy is still a pressing issue for the Government and will remain so for the foreseeable future. The Minister for Finance has set aside €3 billion for additional infrastructure spending “to address the known challenges that we face in housing, energy, water and transport infrastructure."
The key changes announced in Budget 2025 are:
- Increases to tax credits and bands as well as a 1 percent reduction in the USC.
- An increase in the rental tax credit to €1,000, including a retrospective increase to its level in 2024.
- The first increases in the CAT group tax free thresholds since 2019.
- Enhancements to some business and investor reliefs, including a change to the proposed €10 million cap on retirement relief for family transfers of businesses.
- The small gift exemption which allows an employer to reward employees has been enhanced to allow five non-cash gifts up to a value of €1,500 per year.
- Revenue will conduct a range of targeted compliance management activities in 2025.
- Confirmation that the participation exemption for foreign sourced dividends will commence as expected from 1 January 2025.
LOADING...