Budget 2026 – An Overview
Budget 2026 is a mix of modest tax tweaks, ongoing cost-of-living supports, and significant investment in housing, health, and education
The Big Picture:
The Government has announced a €9.4 billion budget, including:
- €1.3 billion in tax measures
- €1 billion set aside in a contingency fund
The main focus areas are: easing the cost of living, boosting public investment, supporting businesses, and strengthening social supports.
Business and investment changes:
- R&D tax credit rises from 30% to 35%, with higher first-year refunds (€87,500).
- Capital Gains Tax (Entrepreneur Relief) lifetime limit increases from €1m to €1.5m on disposals from January 2026.
- Savings & investments: Exit tax drops from 41% to 38% (though deemed disposal rules remain).
Taxation and Income
- Income Tax: No changes to the main tax bands.
- USC: The 2% rate ceiling rises by €1,318 to €28,700, in line with the new minimum wage.
- Minimum Wage: Increasing by 65c to €14.15 per hour from January 2026.
Other tax reliefs:
- Digital gaming tax credit extended for six years.
- Mortgage interest relief extended for two years (capped at €1,250 in 2025 and €625 in 2026).
- Film industry: Enhanced Section 481 relief for productions of 40% (€1m–€10m).
Housing and Property
- Renters’ Credit extended to 2028 (€1,000 for singles, €2,000 for couples).
- Help to Buy Scheme continues, with €1.2bn for starter homes.
- VAT on apartment sales cut from 13.5% to 9% (effective immediately).
- Tax deductions introduced for apartment developments and conversions.
- Derelict property tax: A new 7% levy from 2027, replacing the current site levy.
- Living City Initiative extended to 2030, with broader coverage for older buildings.
- Housing Budget: €11.3bn total, including €2bn for social housing and €300m for urban regeneration.
Health and Social Care
- Department of Health Budget: Increased to €27.4bn (up €1.5bn).
- Staffing: 3,370 new hires, including 220 acute hospital beds, 280 community beds, 500 nursing home places, plus 400 mental health staff.
- Disability services: €500m more for placements, assessments and staff.
- New RSV infant immunisation programme from 2026.
- Private disability assessments: 6,500 to reduce delays.
Social Welfare and Supports
- Core weekly payments increase of €10 for pensions, jobseekers, and disability benefits.
- Carer’s Allowance: Higher income thresholds of €200 for singles and €400 for couples are welcomed across the board and higher disregards (€1,000/€2,000).
- Child Benefit: An increase of €8 per week for under 12s, and €16 per week for over 12s.
- Working Family Payment: An increase of €60 per week.
- Fuel Allowance: An additional €5 per week with the scheme now extended to working family payment recipients.
- Christmas Bonus: Confirmation of double payment for long-term recipients (excluding child benefit).
Business and Employment
- Hospitality VAT: Cut from 13.5% to 9% for food, catering, and hairdressing from July 2026.
- Stamp Duty: New €1bn market cap exemption for SMEs and start-ups.
Carbon Tax: Increasing to €71 per tonne (affecting motor fuels immediately, other fuels from May 2026). - Electric Vehicles: €5,000 VRT relief extended for another year.
- Gardaí & Defence: 1,000 new Gardaí, 200 civilian staff, and an 11% defence budget boost.
Education and Childcare
- Third level fees permanently reduced by €500 (now €2,500 per student).
- SUSI grant threshold raised by €5,000 (up to €120,000).
- New staff: 1,042 teaching posts and 1,717 SNAs.
- School projects: €1.6bn capital funding for 300 builds.
- Early years & childcare: €125m more for inclusion and access, Building Blocks Scheme will focus on expanding existing services to create approximately 2,300 new childcare places.
Other
- Excise duty: 50c increase on cigarettes; no changes for alcohol.
- Sports funding: €3m for League of Ireland academies, €1.6m for inter-county GAA players, IRFU support.
- Agriculture: €85m for bovine TB control.
- Future revenue: Pool betting duty expected in Budget 2027.
While households will feel some relief through welfare increases, child benefit boosts, and tax credits, rising carbon taxes and excise hikes remind us that pressures remain.
Kinetic Financial Review
The Kinetic financial review is our trademark formula for forecasting your financial future and identifying changes that need to be made now to improve your financial position.
This financial review service helps greatly with providing a clear picture of what the future holds.
3 Step Process:
After we complete the financial review, many clients are delighted to have their options regarding pension planning, salary protection, life protection, savings and investments explained to them so clearly.
Not only that, but we can also set up policies for you all online in a very fast and efficient manner.
What Does The Review Cover?
Financial Planning
The Kinetic Review is our trademark formula for forecasting your financial future – and identifying changes that need to be made now to improve your financial position.
Public Sector Pensions
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We often meet with public sector employees who are not even sure which pension scheme they are in.
Often, employees could have breaks in service or received pension contribution refunds.
Visit our sister site MadeSimple.ie for expert information in Irish Public Sector Pensions
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Taxation and Income
- Income Tax: No changes to the main tax bands.
- USC: The 2% rate ceiling rises by €1,318 to €28,700, in line with the new minimum wage.
- Minimum Wage: Increasing by 65c to €14.15 per hour from January 2026.
AVCs (Additional Voluntary Contributions)
(AVCs) are contributions that you can make in addition to your normal contributions to an occupational pension scheme in the public or private sector to increase your retirement benefits.
Savings and Investments
We offer a variety of different investment and saving options depending on the level of risk you are comfortable with.
Life Insurance
Nobody likes to think about the worst happening, but death is a fact of life.
It’s a good idea to have a plan in place to protect your loved ones financially in the event of your death.
