In Budget 2027, Tánaiste and Minister for Finance Simon Harris and Minister for Public Expenditure Jack Chambers announced a number of consumer changes such as to income tax, fuel allowances, childcare and rent relief.
But when will these changes kick in and what do I need to do to claim them?
What are the new income tax rates and when do they start?
- Level at which workers enter 40 per cent income tax rate increases from the current €44,000 for a single person to €46,500
- Personal tax credit, PAYE and earned income credit increases by €125
- Two per cent band of USC increases by €1,600 to €30,300
Harris said the changes to income tax will come into effect from January 2027.
The changes to income tax will be automatically applied.
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Minimum wage uplift
- Minimum wage increases by 79 cent to €14.94 per hour.
This increase will take effect from January 1st.
Social welfare, pensions and disability supports
- €10 increase to weekly social welfare rates to benefit about 1.6 million people, including pensioners, jobseekers, carers and disability scheme recipients.
This will also come into effect in January.
- An annual cost-of-disability payment of €500.
This will be paid to all adult long-term recipients of disability benefits, including the disability allowance, full incapacity pension and the blind pension, accessible to some 240,000 people.
The first payment will happen early next year, in the first quarter.
- The child support payment rises by €6 while the living alone allowance rises by €3 per week.
- Working-family-payment weekly income thresholds increases by €30.
Both will be available from January 2027.
- A Christmas bonus, a double welfare payment, will be paid to almost 1.4 million long-term social welfare recipients in early December.
[ Budget 2027 main points: everything you need to knowOpens in new window ]
When will I get my increased carer’s allowance?
- Income disregard for carer’s allowance rises by €150 for a single person and €300 for a couple and will come into effect from July 2027.
The carer’s allowance is a payment for people on low incomes who are caring for a person who needs full-time care and attention because of age, disability or illness.
However, Minister for Social Protection Dara Calleary said the Government will “get rid of” the means test for the carer’s allowance during the lifetime of this Government, but it has to be done on a “sustainable basis”.
- Home carer tax credit increases by €100 and will be available from January 2027.
[ Q&A: How will social welfare changes affect you?Opens in new window ]
Was there an increase to the Help-to-Buy scheme and when will it come into effect?
- A €5,000 increase was made to the Help-to-Buy scheme allowing first-time buyers to access up to €35,000 towards the deposit on their first home. However, no increase in value of eligible properties (€500,000).
To avail of the Help-to-Buy scheme, first time buyers must apply through Revenue Online Service and go through application, claim and verification stages.
The increase comes into effect on October 7th.
Rent tax credit
- Rent tax credit rises by €150 to €1,150 for single renters and to €2,300 for couples.
- Tax-free threshold for earnings under the rent-a-room relief rises by €2,000 to €16,000 and will be extended to include newly installed detached auxiliary dwellings.
Both of these will come into effect from January.
The rent tax credit and the rent-a-room relief can be claimed through your Income Tax Return with Revenue Online Service.
However, the rent tax credit increases will apply only for the 2027 and 2028 tax years – not this year – so you will be able to claim only at the existing level – €1,000 for a single person or €2,000 for a couple – for 2026.
[ Budget 2027 Q&A: Your questions answeredOpens in new window ]
What are the inheritance tax changes? When do they come into effect?
The three inheritance tax thresholds have been increased.
- The Category A threshold for inheritance tax from parents to children increases by €20,000 to €420,000.
- The Category B threshold, which covers inheritances received by siblings, nieces, nephews and grandchildren, rises by €4,000 to €44,000.
- The Category C threshold, which covers all other people benefiting from a gift or inheritance, rises by €2,000 to €22,000.
The changes will apply to gifts and inheritances taken from October 7th.
Gift and Inheritance tax can be paid and filed through Revenue Online Service.
When does new capital gains tax take effect?
- Capital gains tax cut two percentage points to 31 per cent. The reduction applies for disposals made after October 7th. Therefore, any gains made on disposals from today will be subject to capital gains tax at 31 per cent. However, the reduced rate does not apply to gains made on the disposal of development land.
Was the fuel allowance increased?
Yes, the fuel allowance was increased by €5 per week to €43 per week from this season with a higher income threshold for single people over 66 of €641. This change will happen in January.
When do student fees get cut?
- The €150 permanent cut to student fees comes into effect from January. Students who have already paid in full will receive a €150 refund.
- Families with an income of below €150,000 and more than one child attending college will see fees fall through expanded grant access from September 2027.
- Increase of Susi maintenance grant rates by 4.5 per cent from January 2027.
When will new childcare rates come in?
- Maximum childcare fees reduced from €735 to €550 for children up to senior infants from September 2027.
- Families with a young child attending a creche full-time could save as much as €1,000 a year per child through an increased subsidy under the National Childcare Scheme from September 2027.
- Childcare Services Relief tax exemption increases by €5,000 to €20,000.
Are cigarette prices increasing?
Yes, excise duty on a box of cigarettes rises by €1 from October 7th.
A 20 cent tax per ml of vape e-liquid, exclusive of VAT, was also introduced. However, it does not come into effect until January 1st.
