The Department of Finance and the Department of Public Expenditure and Reform have published the Fiscal Monitor for December 2025 confirming an Exchequer surplus of €7.1 billion for 2025. This compares to a surplus of €12.8 billion recorded for 2024, with the year-on-year decline of €5.7 million being impacted by receipts arising from the Court of Justice of the European Union (CJEU) ruling in the Apple State Aid case. When these receipts are excluded from total receipts in 2024 and 2025, an underlying surplus of €3.8 billion was recorded which represents an improvement of €2.0 billion on the same period last year. Tax receipts collected for 2025 were €107.4 billion for the full year, which was €0.6 billion lower than in 2024. Excluding the once off receipts from the Court of Justice of the European Union (CJEU) judgement in the Apple State Aid case, total receipts amounted to €105.7 billion, an increase of €8.6 billion on the corresponding period in 2024. Income tax receipts for the month of December were €2.8 billion, unchanged compared to the same month in 2024. On a year-to-date basis, receipts for the full year of €36.6 billion were up by €1.5 billion (4.3 per cent), when compared to the full year 2024. Corporation tax receipts of €3.6 billion were collected in December, which is down by €0.5 billion on the same month in 2024. On a cumulative basis, receipts of €34.7 billion were down by €4.4 billion on 2024. When the once-off CJEU receipts are excluded, cumulative corporation tax receipts for the full year amounted to €32.9 billion, higher than the total for 2024 by €4.8 billion. December is a non-VAT due month and receipts of €0.5 billion were collected in the month with cumulative receipts recorded of €22.9 billion for 2025 which were ahead by €1.1 billion on the total receipts for 2024. Commenting on the figures, Tánaiste and Minister for Finance, Simon Harris said: “The Exchequer figures for 2025 are a reflection of the fundamental strength of our economy: income tax and VAT receipts, the clearest indicators of our economic performance, are continuing to perform well, while most other revenue streams are in line with expectations. As we look towards 2026, this Government is committed to using the resources of the State to improve people’s lives in a sustainable manner. Last month, we published Ireland’s Medium-Term Fiscal and Structural Plan, which represents a fundamental shift in the way we do budgetary policy in Ireland. The Plan fixes the level of spending without restricting us from improving public services, investing in infrastructure and protecting the public finances.”

Revenue has updated several guidance documents to reflect changes introduced by Finance Act 2025. We have listed below the documents which have been updated, and details of the relevant changes are included in the Institute’s Finance Bill at a glance document. In some cases, the examples in the guidance have also been updated to reflect the changes. Employer provided vehicles, Deduction for retrofitting expenditure, Rent a room relief, Charitable tax exemption, the updated guidance also provides further details on reliefs and exemptions for charities, and Universal Social charge, this updated guidance also confirms that employer contributions to the Auto Enrolment Retirement Savings System in respect of an employee are not considered relevant emoluments for the purposes of USC and that a donation under section 847AA TCA1997 in respect of donations to National Governing Bodies is not relieved from USC.

Over the break, Revenue has updated its Tax and Duty Manuals (TDMs) relating to Pillar Two which is the core guidance for companies to calculate taxes due under Pillar Two. The relevant manuals are TDM 01A-01-01A which provides guidance on the Pillar Two registration process and TDM 04A-01-02 which is the core guidance for companies calculation taxes under Pillar Two. In terms of registering for taxes under Pillar Two, companies should note that the deadline for registering has been extended to 28 February 2026 (previously 31 December 2025). Revenue guidance on Pillar Two Revenue has updated several areas of its guidance on Pillar Two. The changes include: Section 6.10, regarding the calculation of the Undertaxed Profit Rule (UTPR), has been updated for scenarios where there has been a merger. Section 8.9 has been updated to clarify the treatment of post-filing adjustments and tax rate changes. Section 9.8, regarding the Transitional Country-by-Country Reporting (CbCR) Safe Harbour, has been updated to clarify how a decrease in covered taxes affects the calculation of simplified covered taxes. Section 9.8.1 clarifies how the Transitional CbCR Safe Harbour applies where there is a change in tax residency of an in-scope entity. Section 10.2 discusses the impact of mergers and constituent entities joining and leaving in-scope groups. Section 11.5 clarifies the election to treat an investment entity as a tax transparent entity and the determination of the minimum tax rate applicable. Revenue has advised that the TDM will be updated further in due course to reflect the amendments made in Finance Act 2025. Revenue guidance on Pillar Two registration Revenue has also updated several sections of its guidance on registering for Pillar Two taxes. These include: A new paragraph explaining a new administrative practice for inactive or dormant entities that meet certain requirements. A new paragraph explaining an administrative practice where there is a dissolved entity. A paragraph explaining the registration process for entities without an active tax registration. Clarification on the ROS permissions required by agents using a ROS sub-user certificate. New guidance on approving agent link requests.

Revenue has issued guidance outlining the new stamp duty exemption on acquisitions of stocks and marketable securities provided for by Finance Act 2025. The note outlines the conditions applying to the exemption, details on making a valid notification and several illustrative examples. The exemption will apply to a transfer of relevant securities executed between 1 January 2026 and 31 December 2030, where the qualifying conditions are met. A transfer of relevant securities will qualify for the exemption where: At the date of execution of the transfer, the securities are admitted to trading on a regulated market or a multilateral trading facility within the EU, or on an equivalent third country market, the issuing entity’s closing market capitalisation was less than €1 billion on 1 December in the preceding year, and the transfer is executed during an exemption period, the start and end dates of which are determined by when a valid notification in respect of the market capitalisation was made to Revenue. Where securities are admitted to trading after 1 December of the previous year, the exemption may still apply if the issuer’s expected market capitalisation upon admission was under €1 billion.

Through our participation in the Tax Administration Liaison Committee (TALC), the Institute has consistently engaged with Revenue on the need to restructure the guidance on the reliefs for investments in corporate trades under Part 16 of the Taxes Consolidation Act (TCA) 1997, namely the Employment Investment Incentive Scheme (EIIS), the Start-up Capital Incentive (SCI) and the Start-up Relief for Entrepreneurs (SURE). We are therefore happy to share that Revenue has now restructured its guidance on these reliefs by expanding the guidance across four distinct documents. Part 16-00-02A now provides an overview of the reliefs and explains which of the other three documents is most relevant to the readers specific needs,be they a qualifying company, a qualifying investor, or an entrepreneur. Part 16-00-03 provides guidance for companies who may wish to raise risk finance using EIIS or SCI. Part 16-00-04 provides guidance for investors who seek to claim relief on investments made under EIIS or SCI. Part 16-00-05 provides guidance in relation to the income tax relief available for SURE. Readers should also be aware that the original guidance can be found here.

Last week, Revenue published preliminary results for 2025, including details of tax and duty collections, services delivered to customers, compliance timeliness, and outcomes from various compliance and enforcement initiatives. Most notably, in 2025 Revenue collected more than €106 billion in taxes and duties, along with over €34 billion collected on behalf of other government departments and agencies. In the press release accompanying the publication of the results, Revenue’s Chairman, Niall Cody, recognised the ongoing commitment of taxpayers and tax practitioners in meeting their obligations and achieving consistently strong, timely compliance rates with voluntary compliance delivering rates of 99 percent for large and medium cases and 92 percent across all other cases. The results show that Revenue completed 291,616 audit and compliance interventions during 2025 which yielded €734 million. A total of 189 tax avoidance cases were settled during the year resulting in an additional €41.7million collected on behalf of the public. Revenue is currently challenging 130 tax avoidance cases, relating to 27 transactions with 96 appeals ongoing. Readers should also be aware of the ongoing disclosure opportunity for worker arrangements which may need to have been reclassified following the Supreme Court decision in Karshan. The deadline for such disclosure is 30 January 2026 by which employers can regularise genuine cases of employee misclassification for 2024 and 2025 without incurring penalties or interest. Revenue has also advised taxpayers that 30 January 2026 is the closing date for the public consultation on the modernisation of withholding taxes, including Professional Services Withholding Tax, Relevant Contracts Tax, and expansion to the platform economy. Revenue has advised that you can complete the survey without inputting any identifying details simply by progressing to the next page. However, to the extent that you wish to engage with Revenue directly in the process, you may wish to include such identifying information.

In this week’s cross-border developments and trading corner, we bring you the latest guidance updates and publications. The most recent Trader Support Service bulletin is also available as is the latest Brexit and Beyond newsletter from the Northern Ireland Assembly EU Affairs team. As previously recommended by Chartered Accountants Ireland, the Government announced in 2025 that there would be a permanent solution to the services provided by the Trader Support Service (TSS) beyond the end of 2025. Details of the new provider have now been announced by the Government. New permanent solution to the TSS Following the completion of a competitive procurement exercise, HMRC has appointed Netcompany as the new provider of the TSS. The TSS will remain free to use and continue to operate as normal. Users will still have access to all TSS support, including educational materials and the call centre for live queries. HMRC is working closely with Netcompany and Fujitsu to ensure a smooth transition over the course of 2026. Regular updates will be provided to users, including timely information on transferring to a new platform and any action they may need to take. Users do not need to take any action now and should continue to submit customs and safety and security declarations in the normal way. HMRC will continue to update stakeholders throughout 2026.  Miscellaneous guidance updates and publications This week’s miscellaneous guidance updates and publications are as follows: Check if you can claim a waiver for goods brought into Northern Ireland, Report payments and view your allowance for non-customs state aid and customs duty waiver claims, Customs, VAT and excise UK transition legislation from 1 January 2021, External temporary storage facilities codes for Data Element 5/23 of the Customs Declaration Service, Additional Information (AI) Statement Codes for Data Element 2/2 of the Customs Declaration Service (CDS), and Maritime ports and wharves location codes for Data Element 5/23 of the Customs Declaration Service.

In this week’s detailed miscellaneous updates which you can read more about below, HMRC has issued a response to issues raised for VAT error correction notices and the latest Agent Update is available. HMRC has also announced its revised late payment and repayment interest rates. In other news this week: The December 2025 HMRC Stakeholder Digest is now available, The Institute for Fiscal Studies has published new trends in self-employment and top incomes and a podcast on how to fix VAT, The latest schedule of HMRC Talking Points live and recorded webinars for tax agents are available for booking. Spaces are limited, so take a look now and save your place, and finally, Check HMRC’s online services availability page for details of planned downtime and the online services affected. VAT error correction notices During a HMRC VAT registration subgroup meeting in 2025 (the Institute is represented on this forum),  issues were raised in relation to VAT error correction notices. HMRC has responded as follows: “The online VAT Repayment tracker currently allows the user to view and track progress of all repayments due, this includes VAT repayments, officers assessments, and error correction notifications.  However as displayed below, it does not detail what contributes to a repayment, and it does not advise if a submission was made by the customer or their agent. We are speaking to our IT partners to seek improvements to what is currently shown.” Agent Update 138 Agent Update: Issue 138 is available now. Get the latest guidance and information on: ·operational activity following publication of the independent review of the loan charge, important changes to Automatic Exchange of Information: action required, get ready to file Self Assessment tax returns, mandatory tax adviser registration: policy paper published with guidance coming soon, and Making Tax Digital support and resources for agents. HMRC interest rates The Bank of England Monetary Policy Committee announced a reduction in the Bank of England base rate to 3.75 percent from 4 percent last month. As a consequence of HMRC interest rates being linked to this, HMRC’s interest rates have been reduced. These changes took effect as follows: 7.75 percent is the new rate of late payment interest from 29 December 2025 for quarterly instalment payments and 9 January 2026 for non-quarterly instalments payments, and 2.75 percent is the new rate of repayment interest from the same dates.

Ahead of the 2024/25 online self-assessment (SA) filing and payment deadline of Saturday 31 January 2026, key information and reminders are set out below. Members are also advised to contact the Institute by email if they experience any issues in the coming weeks which prevent the filing of 2024/25 SA returns before the deadline so that we can discuss with HMRC. To the extent unforeseen events arise, we may be able to engage directly with HMRC to seek appropriate accommodations (in a similar manner as last year when various storms affected members). Ahead of this year’s filing deadline, more than 4,600 festive filers escaped the turkey and tinsel on Christmas Day to file their returns with 1-1.59pm being the busiest time; maybe the brussel sprouts were on to boil? Almost 10,500 then boxed clever to file on Boxing Day. However, as at 5 January 2026, almost 5.65 million returns were still due to be filed. By way of reminder, in November HMRC published its top SA filing tips for agents in Agent Update 137. Taxpayers should also be aware of the actions they may need to take due to the in-year changes from 30 October 2024 to the rates of capital gains tax (CGT). Due to this mid-year change, HMRC's online SA filing software does not automatically calculate gains at the correct rates if a taxpayer has gains both before and after the changes. This software has not been updated and defaults to the lower pre-30 October 2024 CGT rates for all gains.  If a taxpayer made disposals of non-residential property assets on or after 30 October 2024, the following actions need to be taken: Calculate the CGT adjustment amount: the taxpayer will need to calculate the difference between the CGT due at the new (higher) rate(s) and the amount calculated by the HMRC software. Use the HMRC calculator to work out the CGT adjustment amount: HMRC has provided an online calculator to help individuals work out the CGT adjustment amount. Enter the CGT adjustment amount on the 2024/25 SA return: the resulting CGT adjustment figure needs to be manually entered into box 51 (adjustments to Capital Gains Tax) on page CG4 of the Capital Gains summary pages (SA108) of the SA return, and Attach the online calculator calculation: it is also recommended that taxpayers save the results page from the online calculator and submit this as an attachment with their SA return.  Key messages for the SA deadline and materials can be found on HMRC’s Frontify platform. As this year’s filing deadline falls on a Saturday, HMRC has also sent the below message setting out details of their support arrangements on that day. This essentially means that there will be no support via telephone on 31 January, except for a call-back service for vulnerable taxpayers. HMRC has also explained below why it is taking this approach. “What we will offer on Saturday 31 January: Significantly enhanced webchat capacity – approximately 200 advisers, compared to our usual Saturday staffing of around 20. This represents a ten-fold increase in capacity. Broader service coverage – webchat will be available across Self Assessment, the Agent Dedicated Line, Extra Support Team, Bereavement, and the Online Services Helpdesk. This is a wider range of services than we could viably staff via phone lines on a Saturday. A callback process for vulnerable customers needing Extra Support or Complex Case team assistance. 24/7 digital resources – our digital assistant and comprehensive GOV.UK guidance will remain available throughout. Why we have taken this approach: We have concluded that the best way to support customers is to prioritise adviser availability in the days running up to the deadline, while providing a comprehensive webchat service on the Saturday itself. This ensures we maintain full capacity during the critical weekdays when demand is highest, while still offering real-time support on the deadline day. Importantly, all remaining Self Assessment customers will be filing digitally, as the paper filing deadline passed on 31 October. Our communications approach: We will be clear and upfront with customers from early January, giving them time to plan ahead. From the week commencing 5 January, we will begin daily social media posts encouraging early contact and digital use, alongside clear messaging that phone lines close on Friday 30 January and reopen on Monday 2 February. On 12 January, we will include details of Saturday's webchat service in our Self Assessment payment reminder press notice, update GOV.UK contact pages, and share information through the Agent Update. From 23 January, IVR messaging will be updated to confirm no phone lines on Saturday, and on 30 January we will issue a final reminder that it is the last day for phone support. This approach gives customers who prefer phone contact time to reach us during the week before the deadline, when we have maximum staffing in place.” Ahead of the filing deadline, the Institute has also been made aware that delays are being experienced in client authorisations being processed and the client appearing on the agent’s client list. We have been advised that HMRC is aware of the issue and a fix has been deployed  for new authorisations. All older authorisations should now be appearing on client lists. Any further issues experienced should be reported to HMRC’s online services helpdesk in the first instance with recourse to the Institute by email if these continue to hamper efforts to file by the deadline.

The Chancellor has asked the Office for Budget Responsibility to prepare an economic and fiscal forecast for publication on 3 March 2026, which is being referred to as the Spring Forecast. This will be followed in Parliament with a statement by the Chancellor, known as the Spring Statement. The Institute will report on this in full when it is announced. Following on from the Autumn Budget, the House of Commons Library has published a further research briefing on the Autumn Budget and the Finance (No. 2) Bill, in addition to a research briefing on the National Insurance Contributions (Employer Pensions Contributions) Bill. Last month the Treasury Committee held an evidence session with the Chancellor to discuss the Budget.

On 23 December 2025 the Government announced that the £1 million allowance for 100 percent agricultural property relief (APR) and business property relief (BPR) for inheritance tax (IHT) will now be increased to £2.5 million from 6 April 2026. Relief will remain limited to 50 percent on the amount of qualifying assets valued above this threshold resulting in an effective IHT charge of 20 percent (i.e., half the standard 40 percent IHT rate). Details of the announcement were made in a news release published by HM Treasury on 23 December 2025. Having lobbied heavily on this issue since the 2024 Budget and throughout 2025, the Institute issued a Press Release on 23 December reacting to the announcement noting this welcome mitigation including the confirmation of transferability of the allowance between spouses. A timeline of all formal lobbying and Press Releases on this issue by the Institute since it was announced in 2024 is set out below. When combined with the transferability of any unused amount of the allowance between spouses and civil partners, another Institute recommendation that was announced at the Autumn Budget in November 2025, this effectively means that a couple will have a combined allowance of £5 million before any unused amount of their transferable nil rate band is taken into account. This would potentially increase the overall 100 percent amount on which no IHT will be payable to £5.65 million should their full £325,000 nil rate band be unused. As a result, many farms and family owned businesses in Northern Ireland will continue to receive 100 percent APR and BPR and not have any IHT liability, protecting the succession plans of these businesses for the next generation. HMRC has published an updated policy paper on this issue which also confirms that if the first spouse or civil partner’s death was before 6 April 2026, it will be assumed that the entirety of their £2.5 million allowance is unused and thus will be available for transfer to the surviving spouse or civil partner. HMRC has also published an explanatory note on the Government’s tabled amendment for this change. Clause 62 and Schedule 12 of Finance (No. 2) Bill have since been amended and the full amendment papers have been published. Finance (No. 2) Bill has now had its second reading in the House of Commons; the next stage is Committee of the whole House which is scheduled to take place today, 12 January 2026. We also understand that during an exchange in Parliament between the Exchequer Secretary (XST) Dan Tomlinson and Robin Swann MLA, it has been suggested that the ability to transfer individual allowances to a spouse/civil partner may potentially also apply to intergenerational farms owned by other family members. The Hansard exchange discussing this has also been published. At present, this is not fully clear and requires Government clarification which we will monitor. The Hansard exchange also confirms that the Government now expects to raise around £300 million from this change. The expected tax take by 2029/30 from the original policy announced in the 2024 Autumn Budget was £520 million. It remains unclear if the Chancellor intends to announce new tax increases in the Spring Forecast to cover this new deficit. However this may not be needed given the £22 billion fiscal headroom provided by the most recent Budget. The full timeline of formal Institute representations and Press Releases on this issue since the Autumn Budget in 2024 is as follows: November 2024: meeting with HMRC on Autumn Budget 2024, December 2024: press release on APR and BPR, April 2025: letter to XST on APR and BPR, April 2025: response to consultation on APR and BPR, July 2025: press release on APR and BPR, September 2025: meeting with local Government on APR and BPR, October 2025: submission to House of Lords Finance Bill Sub-Committee on APR and BPR, October 2025: Autumn Budget 2025 pre-Budget submission, October 2025: evidence session by Leontia Doran to House of Lords Finance Bill Sub-Committee, November 2025: Autumn Budget Press Release, and December 2025: meeting with HMRC on Autumn Budget 2025.  

After months of intense discussion following the announcement by the US Administration that it would be withdrawing from its previous commitments under the OECD’s global minimum tax rules under Pillar Two, the OECD has now published details of a compromise agreement which paves the way for US cooperation with the project. The new package contains details of the new Side-by-Side Safe Harbour which will see countries that operate a minimum tax system with similar policy objectives and overlapping scope as Pillar Two being granted ‘Side-by-Side’ status. The Inflation Reduction Act (IRA) in the US introduced a new corporate alternative minimum tax (CAMT) of 15 percent effective for tax years beginning after 2022. As such, the same minimum tax rate that applies to US and Irish headquartered entities. This is naturally key to ensuring that the compromise agreement does not immediately provide a competitive advantage to companies headquartered in the US over similar entities headquartered in Europe and other jurisdictions implementing Pillar Two.  From an Irish perspective, the report notes, for companies applying the Side-by-Side Safe Harbour, a qualified domestic minimum top-up taxes (QDMTTs) aligned with the Pillar Two rules will continue to apply in Ireland. Therefore, Irish subsidiaries of US-headquartered companies should continue to pay QDMTTs in Ireland with an even playing field being maintained as a result. Overall, the package includes five key components: A series of simplifications to reduce the compliance burden on both in-scope entities and tax authorities. Rules to enhance alignment of tax incentives through a targeted substance-based tax incentive safe harbour. A new Side-by-Side (SbS) Safe Harbour for companies within a group whose ultimate parent entity is located in a jurisdiction that has not implemented Pillar Two and where that jurisdiction operates a minimum tax system with similar policy objectives and overlapping scope as Pillar Two.   A commitment to taking an evidence-based stocktake to ensure that a level playing field is maintained across the jurisdictions participating in the Pillar Two project. A commitment that the qualified domestic minimum top-up tax mechanism will be the primary mechanism for ensuring that local tax bases are protected through this process. The OECD will host a dedicated webinar to support implementation of the package on 13 January 2026.