At FLC Frank Lynch & Co, we are committed to keeping you informed about important financial updates. Today, we bring you a summary of the tax cuts and benefits which were announced in Budget 2024. Let’s have a look at the detail.
Tax Cuts
A personal tax package worth €1.3 billion has been unveiled, with the average individual worker set to receive approximately €800 benefit.
- Personal, PAYE and Earned Income Tax credits will rise by €100, bringing the total tax credit to €1,875.
- The Standard Rate Band will increase by €2,000 to €42,000.
- The lower 2% rate of Universal Social Charge (USC) now applies to earnings up to €25,760, thanks to a €2,840 increase.
- The higher rate of USC for earnings between €25,760 and €70,044 has decreased by 0.5% to 4%
- The home care and single person child carer credit will increase by €100. While the Incapacitated Child Credit will increase by €200.
- The lower USC for those with a medical card earning less than €60,000 is extended to 2025.
Social Welfare and Pensioners
- Weekly welfare and pension payments will see a permanent increase of €12. Additionally, recipients can look forward to special bonuses and lump sum payments at Christmas and in January, as well as some lumpsum payments including
- €200 for Living Alone Allowance
- €400 for Carers Support Grant
- €400 for Disability Support Grant
- €400 for Working Family Payment
- €300 Fuel Allowance Payment
- €100 Qualified Child Bonus
Families and Children
- A 25 percent reduction in childcare costs is planned for September 2024
- A double child benefit payment of €280 per child will be made before Christmas
- Child benefit will extend to parents of 18 year olds in full time education
- Free schoolbooks will be provided at junior cycle in secondary school
- Families with an income of less than €100,000 will see undergraduate college fees halved from €3,000 to €1,500
Mortgage Holders
Homeowners who have experienced payment increased due to interest rate hikes, will receive assistance in the form of a one time measure costing €125 million. Here are the key details:
- Eligibility: Applicable to principal private residences only, not rental properties
- Outstanding Mortgage Balance: Between €80,000 and €500,000 on 31 December 2022
- Relief: Provided a 20% tax relief on the increased interest paid in 2022 compared to 2023, capped at €1,250 per property.
Housing, Landlords and Renters
- Rental Tax Credit: The rental tax credit will increase from €500 to €750
- Parents who pay for their childrens full time accommodation expenses can claim a credit, with claims allowed for 2022 and 2023
- Landlords will benefit from a tax break ranging from €600 to €1,000. This benefit will increase each year the landlord remains in the market, up to 2027.
- The Help to Buy Scheme has been extended until the end of 2025 and reformed to ensure that applicants for local authority affordable purchases can also avail
Energy Credits
- Households will receive three energy credits, each worth €150
- The lower 9% rate of VAT on energy products will extend for another 12 months
Businesses, Workers and Farmers
- A €250 million package has been allocated to assist in small and medium sized firms in coping with costs of business.
- A tax break for angel investors have been introduced, allowing them to benefit from a reduced rate of Capital Gains Tax when disposing of qualifying investments, with gains capped at twice the value of the investment.
- The minimum wage will increase to €12.70 in January
- The R&D tax credit will increase from 25% to 30%
- Investors can now claim relief on up to €500,000 for four year investments under the Employment Investment Incentive Scheme
- The upper age limit for Retirement Relief has been extended from 65 to 70
Motoring
- Employees with an electric company vehicle will see an overall benefit in kind market value relief of €45,000
- There will be an extension of the VRT relief for battery electric vehicles extended to 2025
The 2024 Budget announcements are set to have an impact on your financial situation. We encourage you to consult with us at FLC Frank Lynch & Co for personalised advice on how these changes may affect your circumstances.
Our dedicated team would be delighted to discuss any queries you may have. You can reach us by phone on 0429332273 or email info@flc.ie
As this release is intended as a general guide to the subject matter, it should not be used as a basis for decisions. For this purpose advice should be obtained which takes into account all the clients circumstances. Every effort has been made to ensure the accuracy of the information in this release. In view of its purpose, the reader will appreciate that we are unable to accept liability or any errors or omissions which may arise.