Ireland Budget 2027
Tánaiste Simon Harris announced a package worth €8.5 billion on 6 October. From income tax to the new state investment scheme – here’s what the government published and what it could mean for you.
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Key takeaways
Simon Harris provided details on the upcoming Personal Investment Account (PIA), allowing individuals to contribute up to starting 1 July 2027
An income tax package of €1.3 billion was announced, with the 40% income tax rate increased to for a single person
First time buyers will be able to access up to €35,000 towards the deposit on their first home, under the Help to Buy (HTB) Scheme
The information provided here is for informational and educational purposes only and does not constitute financial advice. Please consult with a licensed financial adviser or professional before making any financial decisions. Your financial situation is unique, and the information provided may not be suitable for your specific circumstances. We are not liable for any financial decisions or actions you take based on this information.
How does the Budget work?
The Government Budget has two parts:
- The Finance Bill, which you can think of as the revenue side, covering taxes including:
- Income tax
- The Universal Social Charge (USC)
- Value-Added Tax (VAT) rates
- Capital Gains Tax (CGT)
- Excise duties
- Any new levies
- The Appropriation Bill, covering spending across government departments:
- Health
- Education
- Housing
- Social protection
Preparation begins months in advance:
15 June 2026 | National Economic Dialogue opens Budget consultations |
22 July 2026 | Broad fiscal parameters are set in the Summer Economic Statement |
6 October 2026 | Budget 2027 is presented to Dáil Éireann |
After Budget Day | Legislation converts Budget announcements into legally binding tax rules and approved spending |
When is the Irish Budget announced?
Budget Day usually takes place on the second Tuesday in October, with documents made available on a dedicated Budget website. This year, the Budget was announced on 6 October 2026.
What are the key points of Budget 2027?
Here’s an overview the key measures announced on 6 October:
New Personal Investment Accounts | Personal Investment Accounts launched from 1 July 2027 allow up to €12,000 in yearly contributions with a €50,000 tax-free growth threshold (1% tax on excess) |
Income tax bands & credits | Standard rate cut-off increased by €2,500 to €46,500 for single earners; main personal, PAYE, and Earned Income tax credits raised by €125 each to €2,125 |
Universal Social Charge (USC) | Ceiling for the 2% USC band increased by €1,600 to €30,300, keeping full-time minimum wage earners outside higher rate bands |
Minimum wage | Increased by 79 cents to €14.94 per hour, effective 1 January 2027 |
Social welfare & state pension | Core weekly social welfare and pension rates increased by €10, alongside a €5 weekly boost to the Fuel Allowance |
Housing & rent supports | Help to Buy (HTB) max tax rebate raised from €30,000 to €35,000; Rent Tax Credit increased by €150; Rent-a-Room tax exemption cap raised to €16,000 |
Inheritance Tax (CAT) | Parent-to-child (Group A) tax-free threshold increased by €20,000 to €420,000 |
Capital Gains Tax (CGT) | Capital Gains Tax (CGT) on sales of stocks, shares and other chargeable assets reduces from 33% to 31% |
Tobacco & vapes | Packet of 20 cigarettes increased by €1; new e-liquid tax introduced at €0.20 per ml |
Fuel & energy support | Temporary petrol and diesel excise rate cuts extended to 28 February 2027; carbon tax on home heating fuels slashed to €48.50 per tonne |
How does the Budget become law?
While the Budget announces new measures, the Finance Bill determines how they become law.
The Dáil votes on the initial financial resolutions and the Oireachtas passes the accompanying Finance Bill and Social Welfare Bill before the end of the year.
Who provides independent oversight of the Irish Budget?
Ireland's Budget faces independent oversight from the Irish Fiscal Advisory Council (IFAC) and the Parliamentary Budget Office (PBO), with extra checks by legislative committees and audit offices. IFAC and the National Economic and Social Council (NESC) also publish independent reports before and after Budget Day.
Frequently asked questions
What is the difference between current and capital expenditure?
Current expenditure covers daily government running costs, including public sector pay and pensions. Capital expenditure pays for long-term investments like infrastructure, public buildings and software.
How do income tax and Universal Social Charge (USC) updates work?
Annual Budget announcements set new rates, thresholds and tax credits for Irish income tax and USC. Financial resolutions and the subsequent Finance Act give these updates legal force. Revenue then pushes updated tax profile details directly to employers via automated payroll notifications, ensuring the correct tax comes off the first payday in January.
How is the Rent Tax Credit claimed?
You can claim the tax credit for rent payments you made in previous years by making an income tax return. You can also claim the tax credit for payments made in the current year if you are a PAYE taxpayer.
Eoghan O’Hara, Country Head Ireland at Raisin, gave his reaction:
“Today’s Budget should deliver some relief for Irish households facing ongoing cost-of-living pressures. Increasing the standard income tax band to €46,500, adjusting USC thresholds, increasing the Rent Tax Credit, and capping childcare costs will provide direct, welcome breathing room for family budgets across the country. Alongside cuts to Capital Gains Tax and higher inheritance tax thresholds, these measures offer a steady boost, allowing households to retain more of their income while supporting long-term financial planning.
We also welcome today's focus on giving consumers greater choice across saving and investment. The introduction of a Savings and Investment Account has the potential to bring investing into the mainstream for more Irish households, particularly those who have traditionally found it difficult to know where to start.
For consumers, choice matters. Competition between providers helps drive better products, greater transparency and more attractive opportunities for savers. Our experience at Raisin shows that when people can easily compare their options and understand the value available to them, they are more likely to take an active approach to their finances.
The focus now should be on making these opportunities as accessible and straightforward as possible. The more choice and transparency consumers have, the better positioned they are to make their money work harder for them.”
Save smart with Raisin
Following the latest Budget announcement, you might be looking for ways to make your money go further. With Raisin, you can access competitive savings rates from over 30 trusted European banks, and manage everything through one simple online account.
Deposits of up to €100,000 per person, per bank are legally protected by the national deposit guarantee scheme of the country where the bank is headquartered.
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All interest rates displayed are Annual Equivalent Rates (AER), unless otherwise explicitly indicated. The AER illustrates what the interest rate would be if interest was paid and compounded once a year. This allows individuals to compare more easily what return they can expect from their savings over time. Raisin Bank, trading as Raisin, is authorised/licensed or registered by BaFin (Bundesanstalt für Finanzdienstleistungsaufsicht) in Germany and is regulated by the Central Bank of Ireland for conduct of business rules.