Budget 2024 has been released and includes tax breaks for workers across the country.
It’s the announcement that workers across the country have been waiting for.
The final package was announced by Minister for Finance Michael McGrath and Public Expenditure Minister Paschal Donohoe, with the core package likely to be worth at least €10 billion.
Below, we have broken down everything you need to know about today's Budget announcement.
Plus - wondering how the Budget has affected your take home pay? Try our Budget 2024 Calculator below!
Taxback’s Top Budget Takeaways
1) Income tax bands expanded
As part of the budget package, the government has announced that the standard tax rate band of €40,000 has been increased to €42,000.
That means that employees can earn an extra €2,000 before paying tax at the higher rate of 40%.
This will no doubt be a welcome development for many in Ireland’s squeezed middle.
In the previous budget, there was a near €4,000 increase in the lower rate cut-off point.
2) Cuts to USC
There have also been cuts to USC in Budget 2024.
USC or the Universal Social Charge is a tax on your gross income that replaced both the health and the income levy in January 2011. It’s likely you'll recognise this from your payslip each time you're paid.
The 4.5% rate of USC has been cut to 4% – the first change to this tax in 5 years.
The maximum amount for the lower 2% rate of Universal Social Charge will go up by €2,840, meaning it will apply on earnings up to €25,760.
3) Rent Tax Credit increased
The Rent Tax Credit has been increased by €250.
This means, if you’re a single individual and you pay to rent your property, you’re now entitled to a tax credit worth €750. Meanwhile, married couples can claim €1,500.
The Rent Tax Credit was originally introduced in Budget 2023 and is available to all property renters in Ireland. Learn more about this credit here.
Furthermore, if you pay for a student child living in 'digs' accommodation, you can avail of the Rent Tax Credit for them.
4) Energy credits reintroduced
Three energy credits have also been included in the Budget announcement.
The electricity credits will be paid in three installments of €150 per household between the end of this year and April of next year.
5) Good news for parents
Parents will receive a double childcare benefit payment in December 2023.
Elsewhere, the free book programme will be extended to over 770,000 students in the Junior Cycle - from September next year.
Other credits such as the Home Carer Tax Credit and the Single Person Child Carer Credit have been increased by €100. As well as this, the Incapacitated Child Tax Credit has been increased by €200.
Meanwhile, the National Childcare Scheme will see a further 25% reduction in childcare costs.
The rate of statutory foster care is to be increased by the end of 2024 by €75 per week for children under 12, while over 12's will see an increase of €73 per week, bringing it up to €400 and €425 per week respectively.
From an education standpoint, €338 million is being allocated to the core spending of the Department of Children, Equality, Disability, Integration and Youth.
6) Social welfare increases
There has been a €12 increase to all social welfare and pension payments.
As mentioned, there is a double payment of Child Payment, which will be up to €140 for each child, and it will be paid out to all qualifying households before Christmas.
The threshold for income on applicants for the Working Family Payment is to be raised by €54 per week.
The Child Benefit payment is being extended to 18-year-olds in full-time education.
The average Irish tax refund is €1,880
The average Irish tax refund is €1,880
What will all this mean for your pocket?
Put simply, the Budget 2024 will impact everyone differently!
If you are a middle-income earner, there is a chance you will end up paying less tax if part of your income falls into the lower tax bracket.
If you are renting in Ireland, there’s a good chance you could avail of the Rent Tax Credit!
Even if you claimed the Rent Tax Credit on your 2022 tax return, you will be able to claim it in 2023.
The easiest way to claim it is with Taxback.
Every year, countless workers in Ireland miss out on claiming their Irish tax entitlements.
Don’t be one of those people - apply for your Irish tax refund today!