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Budget 2015: What does it mean for me?

Rob O’Neill, Senior Financial Advisor

Budget 2015 is the first budget since the economic collapse in 2008 to lower taxes and increase social welfare payments signalling the end of austerity for Ireland. Budget 2015 is by no means a giveaway budget, but with changes to USC and the reduction in the higher rate of income tax from 41% to 40%, the majority of families should find more money in their pay packet this January.


Below is a synopsis of the main changes announced by Michael Noonan on Tuesday. If you want to find out how the budget will impact your income, have a really handy budget calculator.


Budget 2015: The Main Points


  • An increase in the standard rate tax band of income tax by €1,000 from €32,800 to €33, 800 for single individuals and from €41,800 to €42,800 for married single income couples.


  • A reduction in the higher rate of income tax from 41% to 40%.


  • Changes to the Universal Social Charge (USC) were announced:


Incomes of €12,012 or less are exempt. Otherwise:


  1. €0 to €12,012 will decrease to 1.5% 
  2. €12,013 to €17,576 will decrease to 1.5%      
  3. €17,577 to €70,044 will decrease to 3.5%      
  4. €70,045 to €100,000 will decrease to 7%      
  5. PAYE income in excess of €100,000 will decrease to 8.0%.
  6. Self-employed income in excess of €100,000 increased from 10% to 11%.


  • The 12.5% rate of corporation tax is being maintained.


  • The excise duty on a packet of 20 cigarettes is being increased by 40 cents (including VAT) with a pro-rata increase on other tobacco products, with effect from midnight on 14 October.


  • Refund of DIRT on savings used by first-time house buyers towards the deposit on a new home.


  • Child benefit will be increased by €5 per month in 2015.


  • Tax relief at 20% will be provided on water charges up to a maximum of €500 a year.


  • The Pension Fund Levy will be 0.15% in 2015 and will expire at the end of 2015.


  • Exit Tax Rates – the rate of exit tax that applies on life assurance policies and investment funds is being  maintained at 41% for 2015. (Where the life policy is owned by a company the exit tax rate of 25% still applies).


  • Deposit Interest Retention Tax (DIRT) – the rate of DIRT is being maintained at 41% for 2015.


  • Capital Acquisitions Tax (CAT) – the current rate of 33% is being maintained. The current group tax-free thresholds remain unchanged.


  • Capital Gains Tax (CGT) – the current rate of 33% is being maintained.


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