Conor Murray • 27 Sep 2022
Budget Summary 2023
Details of Budget 2023 were announced earlier this afternoon by the Minister for Finance, Paschal Donohoe & the Minister for Public Expenditure and Social Reform, Michael McGrath.
A summary of the main points are as follows:
Income Tax Credits, USC & Minimum Wage
- Increase in 20% standard rate tax band by €3,200 to €40,000 p.a. The higher rate of income tax will now apply on earnings of €40,000 +.
- Increase of €75 in the personal tax credit, employee and earned income tax credit.
- Increase in the 2% USC rate band to €22,920, an increase of €1,625.
- Increase in the Home Carer Tax credit of €100 p.a.
- Rent tax credit of €500 p.a. to be introduced for 2023 onwards. This will be available to claim retrospectively for 2022 for those paying rent in 2022.
- Small benefit exemption to be increased by €500 p.a. to €1,000 p.a. and can be paid to employees via two vouchers in a year and will apply for 2022.
- National Minimum Wage increased to €11.30 per hour from January 2023 (announced earlier this month)
- €12 per week increase in state pension and social welfare payments.
- A €400 lump sum payment to fuel allowance recipients in November 2022
- A double week for social welfare recipients in October and December 2022.
- A double Child Benefit payment in November 2022.
- A new Business Energy Support Scheme to be introduced to provide support to trading businesses facing increased energy costs of more than 50% relative to 2021. To be administered by Revenue, similar to the Covid schemes. Support of 40% of the increase in energy costs, capped at €10k per month per business.
- 9% VAT rate (for hospitality industry) will not be extended beyond 28 February 2023.
- 0% VAT rate on newspapers to be introduced from 1 January 2023.
- 0% VAT rate on defibrillators to be introduced from 1 January 2023.
- 0% VAT rate on nicotine replacement products and HRT from 1 January 2023.
- Young Trained Farmer and Farm Consolidation Stamp Duty Reliefs, the Farm Restructuring CGT (capital gains tax) relief, and the Young Trained Farmer and Registered Farm Partnership Stock Reliefs to be extended beyond 2022.
- Knowledge Development Box scheme extended for further 4 years.
- The Key Employee Engagement Program (KEEP) to be extended to end of 2025.
- The deduction available for landlords for qualifying pre-letting expenses from rental income to be increased to €10,000.
- A vacant property tax to be introduced on residential properties which will be self-assessed and amount to 3 times the basic LPT rate applicable. This will apply to properties occupied for less than 30 days in a 12-month period.
- The Help to Buy scheme to continue in its current form to December 2024.
- €337 million capital intervention will go towards grants for energy efficiency, which will fund over 37,000 home energy upgrades including households in, or at risk of, energy poverty through the Warmer Homes Scheme.
Cost of Living Measures
- Energy credit of €600 to be provided in 3 credits of €200 toward electricity and heating costs. First credit of €200 to be applied pre-Christmas 2022.
- Third level student contribution decreased by €1,000 for 2022/23 academic year.
- Increase in childcare funding support to produce a 25% reduction in childcare costs.
- Free GP care to be extended to 6 and 7 years olds in Q4 2022.
If you would like further information relating to Budget 2023 please contact us.