Personal Allowance 2024 To 2025
At a glance: Here are the key points from Budget 2024
The Government has announced Budget 2024 which includes a raft of cost-of-living measures.
Here are some of the key points from the announcement and how they will affect you.
Tax
The Universal Social Charge has been cut from 4.5% to 4%, the first reduction in USC rates in five years.
The point at which workers pay the top rate of tax will rise to €42,000.
The entry threshold to the 4% rate of USC will be raised to €25,760.
The national minimum wage has been increased by €1.40 an hour to €12.70 an hour.
Personal, Employee PAYE and earned income tax credits are being increased by €100 each.
Pay Related Social Insurance (PRSI) contribution rates will increase 0.1% from 1 October next year.
Cost of living
Minister for Finance Michael McGrath has proposed extending the 9% reduced VAT rate for gas and electricity for another 12 months, helping consumers to save an extra €90 for electricity and €62 for gas.
Minister for Public Expenditure and Reform Paschal Donohoe said all households will receive three energy credits of €150 each to help with bills over winter. They will be provided in three instalments between the end of 2023 and April next year.
A €300 lump sum payment will be made to recipients of the Fuel Allowance in the last quarter of this year.
Mortgage Interest Relief
A new one-year Mortgage Interest Tax Relief is set to be introduced
A one-year Mortgage Interest Tax Relief for homeowners with an outstanding mortgage balance of between €80,000 and €500,000 from December 31 has been confirmed.
Relief will be available on the increased interest paid on the mortgage in the calendar year 2023 as compared with the amount paid in 2022, at the standard rate of 20% income tax.
The relief will be capped at €1,250 per property.
Housing and Renters
The Help-to-Buy scheme is being extended to the end of 2025.
The Rent Tax Credit will be increased from €500 a year to €750 a year.
Parents who pay for their student children who have tenancies in ‘Rent a Room’ or ‘digs’ accommodation will now be able to claim the Rent Tax Credit. This will be backdated to allow for claims to be made for the 2022 and 2023 tax years.
Read more:Latest Budget 2024 storiesLive: Updates as they happen Energy credits and mortgage interest relief confirmed in BudgetUSC reduced, standard rate income tax cut-off increasedReduced VAT rate for gas and electricity to be extended
Social welfare
Weekly social protection payments will increase by €12.
The Qualified Child Increase will increase by €4 to €46 per week for under 12s and to €54 per week for over 12s.
An additional €200 will be paid to those receiving the Living Alone Allowance.
The Christmas Bonus to those in receipt of regular Social Protection payments will be paid in early December.
A once-off double week “Cost of Living Support” payment to all qualifying Social Protection recipients will be paid in January.
A special, once-off payment of €400 will be made before Christmas to those who receive the Carer’s Support Grant, Disability Allowance, Blind Pension, Invalidity Pension and Domiciliary Care Allowance.
A double payment of the Foster Care allowance will also be made this year.
Education
Students in the first three years of secondary school will receive free books under a new Budget measure
Free school books for students in the first three years of secondary school has been announced, meaning 770,000 students across primary and secondary schools will get free textbooks and workbooks.
Families with an income of less than €100,000 will have college fees for undergraduate students halved to €1,500.
Other families will see college fees for full-time undergraduate students cut by €1,000.
The fee waiver on school transport services will be extended for a further year while the fee waiver for students sitting State exams will also be extended.
Children
The home carer tax credit and the single person child carer credit will be increased by €100 and the incapacitated child tax credit is being increased by €200.
A double payment of Child Benefit, worth an additional €140 for each child, will be made to all qualifying households before Christmas.
The National Childcare Scheme will see a further 25% reduction in childcare costs.
The statutory foster care rate will be increased by the end of 2024 by €75 per week for children under 12 and €73 per week for children over 12, bringing it to €400 and €425 a week, respectively.
Climate
A new Infrastructure, Climate and Nature Fund will be established, the Government has announced
A new Infrastructure, Climate and Nature Fund will be established which will grow by €2bn for seven consecutive years when it will reach €14bn.
The accelerated capital allowances scheme for energy efficient equipment is being extended for a further two years.
The tax disregard in respect of personal income received by households who sell residual electricity from micro-generation back to the national grid is being doubled.
The zero VAT rate on the supply and installation of solar panels is being extended to schools from 1 January 2024.
VRT relief for battery electric vehicles is being extended to the end of 2025.
The rate per tonne of carbon dioxide emitted for petrol and diesel will go up from €48.50 to €56.00 from 11 October as per the trajectory set out in the Finance Act 2020.
Forecourt fuel prices will increase from midnight tonight – adding €1.28 and €1.48 to the cost of a 60-litre fill of petrol and auto diesel, respectively.
However, Minister McGrath said an increase in fuel excise of 8 cent on a litre of petrol and 6 cent on diesel, as well as 3.4 cent on marked diesel, due at the end of October would instead come into effect in two equal instalments on 1 April and 1 August next year.
There will be a €7.50 increase on the current rate of Carbon Tax that is applied per tonne of carbon dioxide emissions by carbon fuels.
This will bring the carbon tax rate up to €56.00 per tonne.
Justice and defence
A package €172 million will be allocated for the justice sector
A package €172 million will be allocated for the justice sector which include funding towards the recruitment of 1,000 gardaí and up to 250 garda civilian staff.
An additional €25 million will be added to the garda annual overtime budget.
The defence sector will receive funding of €1.23bn next year aimed to further progress of the “priority recommendations” of the Commission on the Defence Forces and the Independent Review Group as well as towards the recruitment of 400 additional military personnel.
Healthcare
A total of €22.5bn has been allocated for the public health system which includes an €808m increase in core current funding to tackle demographic and service pressures.
Non-core resources of over €1bn will be allocated for spending toward Covid-19 and Ukraine.
Cigarettes and vaping
The excise duty on a packet of 20 cigarettes will be increased by 75 cents – bringing the total price to €16.75.
A domestic tax on e-cigarettes and vaping products has been proposed by Minister McGrath for next year’s Budget.
