Budget 2025

Budget 2025 was announced on Tuesday, 1 October 2024.

The Budget sets out an overall package of €10.5 billion. This is made up of a package of once-off measures worth €2 billion, total expenditure of €6.9 billion and additional capital expenditure of €1.6 billion and permanent tax changes of 1.4 billion for 2025.

This document is a short summary of the main changes in taxation, once-off payments, cost of living supports, supports for energy costs, social welfare, health, housing, education, employment and other areas. It is an overview and not a complete statement of all the measures announced in Budget 2025.

It is currently being updated with information on the measures announced.

Some of the changes announced in the Budget come into effect immediately or before the end of 2024. Others take effect from the beginning of January 2025 or later in 2025. Many others have to be finalised before coming into effect. Some elements of these measures may change when the legislation required to bring them into effect is enacted.

You can access a range of information from gov.ie:

• Budget 2025
• The Expenditure Reports
• Ministers' speeches
• Taxation measures
• Budget publications
• Your Guide to Budget 2025

The Department of Social Protection allocation is €2.6 billion in 2025.

Once-off payments

• Once-off payment of €200 to people getting the Living Alone Increase (November 2024)
• Once-off payment of €300 to people getting Fuel Allowance (November 2024)
• Once-off payment of €400 to people getting the Working Family Payment (November 2024)
• Once-off payment of €100 for each qualifying child to people who get an increase for a qualified child (November 2024)
• Two double payments of Child Benefit for each child, one to be paid in November 2024 and the second in December 2024.
• A double week payment to people getting a long-term social welfare weekly payment in October 2024 (in addition to the Christmas Bonus)
• Once-off payment of €400 to people getting Disability Allowance, Invalidity Pension or Blind Pension (November 2024)
• Once-off payment of €400 to people getting Domiciliary Care Allowance and/or the Carer’s Support Grant (November 2024)

If you get Disability Allowance, Invalidity Pension, Blind Pension, Domiciliary Care Allowance and/or the Carer's Support Grant, you'll get one payment of €400, even if you qualify for more than one of these payments or you are caring for more than one person.

Social welfare weekly payments

The maximum weekly rate of Maternity Benefit, Adoptive Benefit, Paternity Benefit and Parent’s Benefit will increase by €15 (January 2025). All other weekly social welfare payments will increase by €12 with proportional increases for qualified adults and people on reduced rates of payment (January 2025).

The Increase for a Qualified Child (IQC) will be renamed the Child Support Payment. The weekly rate will increase by €4 from €46 to €50, for children under 12 years of age. It will increase by €8 from €54 to €62 for children aged 12 years and over (January 2025).

A once-off double week will be paid to people getting a qualifying social welfare payment in October 2024. Payments that qualify for the Christmas Bonus will qualify for the once-off double week in October.

Christmas Bonus

A Christmas Bonus of 100% will be paid in December 2024 to people getting a qualifying social welfare payment. This is in addition to the double week payment for people on long-term social welfare payments in October 2024.

Child Benefit

A Newborn Baby Grant of €280, in addition to the first month of Child Benefit of €140, will be paid to children born on or after 1 December 2024.

A once-off double payment of Child Benefit for each child will be paid in November 2024. The double payment will be €280 for each child. Another once-off double payment of Child Benefit for each child will be paid in December 2024.

Working Family Payment

The Working Family Payment income limits will increase by €60 a week for all family sizes (January 2025).

Carers

The Carer's Allowance income disregard will increase to €625 for a single person and €1,250 for a couple (July 2025).

Carer’s Allowance will become a qualifying payment for Fuel Allowance (January 2025).

Carer’s Benefit will be extended to people who are self-employed (January 2025).

The Carer’s Support Grant will increase by €150 from €1,850 to €2,000 (June 2025).

Domiciliary Care Allowance will increase by €20 from €340 to €360 per month (January 2025).

Means test

If you are getting the State Pension (Non-Contributory), Disability Allowance or Blind Pension, the amount not taken into account when you sell your home to move into care will increase from €190,500 to €337,500 (January 2025).

Employment programmes

People on Community Employment (CE), Tús and the Rural Social Scheme will get an increase of €12 per week (January 2025). People on the Work Placement Experience Programme will get an increase of €24 per week (January 2025).

Free Travel Scheme

The Free Travel Scheme Companion Pass will be extended to all people aged over 70 (September 2025).

Fuel Allowance

The Fuel Allowance means test disregard for people aged 66 and over will be €524 for a single person and €1,048 for a couple (January 2025).

Carer's Allowance will be a qualifying payment for Fuel Allowance (January 2025).

New Pay-Related Benefit Scheme

The introduction of Jobseeker's Pay-Related Benefit will start from 31 March 2025. Under the scheme, a person will get a jobseeker’s payment rate linked to their previous employment income.

Pension auto-enrolment

The introduction of the auto-enrolment retirement savings scheme will start from 30 September 2025.

See the full list of social welfare rates for Budget 2025:

• Pensions
• Working age payments
• Disability and illness
• Carers
• Children and families
• Other payments

Income tax bands 

The standard rate income tax band (the amount you can earn before you start to pay the higher rate of tax) will be increased by €2,000 to €44,000 for a single person, with proportionate increases for married couples.

Tax credits 

The following tax credits will increase by €125 to €2,000:

• Personal tax credit
• Employee tax credit
• Earned income tax credit
  

Other tax credits will also increase:

• Blind tax credit by €300 to €1,950
• Dependent relative credit, by €60 to €305
• Home carer credit, by €150 to €1,950
• Incapacitated child credit, by €300 to €3,800
• Single person child carer credit, by €150 to €1,900

The rent tax credit is increased for 2024 and 2025, by €250 to €1,000.

Universal Social Charge (USC) 

The 4% rate of USC will be reduced to 3%.

The entry point for this rate will increase by €1,622, in line with the increase to the national minimum wage, so it will apply to income between €27,382 and €70,044.

Capital Acquisitions Tax 

The group thresholds for Capital Acquisitions Tax (CAT) are increased:

• Group A to €400,000 (from €335,000)
• Group B to €40,000 (from €32,500)
• Group C to €20,000 (from €16,250)

The increased thresholds apply where the date of the gift or inheritance is on or after 2 October 2024.

Vacant Homes Tax 

The rate of Vacant Homes Tax will be increased to 7 times the basic rate of Local Property Tax (LPT) for the property (increased from 5 times LPT).

Small benefit exemption

Employees can get some vouchers or other non-cash benefits each year without paying tax on them. From 1 January 2025, there will be an increase in the maximum exemption, from €1,000 to €1,500. This can include up to 5 non-cash benefits per year (an increase from 2 benefits per year).

Carbon tax 

From 9 October, the rate of carbon tax for petrol and diesel will increase from €56 to €63.50 per tonne. The increase will apply to all other fuels from 1 May 2025.

Value Added Tax  (VAT)

The VAT rate on heat pumps will reduce to 9%.

The reduced VAT rate of 9% on gas and electricity will be extended to 30 April 2025.

Excise duty

There is an increase of €1 (including VAT) on a packet of 20 cigarettes from 2 October 2024, with a pro-rata increase on other tobacco products.

Excise duty will be introduced for e-cigarettes in mid-2025. The rate will be €0.50 per ml of e-liquid.

CervicalCheck payments

Payments made to women affected by failures in the CervicalCheck programme will be exempt from income tax, Capital Gains Tax and Capital Acquisitions Tax.

The Department of Enterprise, Trade and Employment allocation is €1.03 billion in 2025.

Minimum wage 

The national minimum wage will increase by 80 cents to €13.50 per hour from 1 January 2025.

Income tax and Universal Social Change (USC)

Income tax rates will stay the same (at 20% and 40%), but there will be increases to tax credits and changes to the income tax bands in 2025.

The standard rate tax band (the amount you can earn before you start to pay the higher rate of tax) will be increased by €2,000 to €44,000 for a single person, with proportionate increases for married couples and civil partners.

The following tax credits will increase by €125 to €2,000:

• Personal Tax Credit
• Employee Tax Credit
• Earned Income Tax Credit

The 4% rate of Universal Social Charge (USC) will be reduced to 3% from 1 January 2025. The entry point for this rate will increase by €1,622, in line with the increase to the national minimum wage, so it will apply to income between €27,382 and €70,044.

Supports for unemployed people 

The Community Employment (CE) and Tús weekly payments will increase by €12 from 1 January 2025. The Work Placement Experience Programme (WPEP) weekly payment will increase by €24 from 1 January 2025.

Small benefit exemption

Employees can get some vouchers or other non-cash benefits each year without paying tax on them. There will be an increase in the maximum exemption, from €1,000 to €1,500. This can include up to 5 non-cash benefits per year (an increase from 2 benefits per year).

Supports for business 

A new €4,000 Power Up Grant for commercially rateable premises in the hospitality and retail businesses sector for the cost of electricity will be paid before Christmas.

The first-year payment threshold for the Research and Development (R&D) Tax Credit will increase from €50,000 to €75,000.

The new CGT entrepreneur relief of 16% for angel investors in innovative start-up SMEs was announced in last year’s Budget and will commence shortly. The relief applies when investors dispose of a qualifying investment for gains up to twice the value of their investment. The limit on gains is being increased from €3 million to €10 million.

VAT registration thresholds will increase to €85,000 for goods and €42,500 for services from 1 January 2025.

The upper age limit for Retirement Relief will increase from 65 to 70 from 1 January 2025. If a child or children sell assets worth over €10 million within 12 years of receiving them, a clawback of the relief will be applied. However, if the assets are retained for more than 12 years, Capital Gains Tax (CGT) will be fully waived.

Supports for farmers

The following farming tax reliefs will continue until 31 December 2027

• General Farmer Stock Relief
• Young Trained Farmer Stock Relief
• Registered Farm Partnership Stock Relief

Audio visual sector

A new Tax credit for Unscripted Production at a rate of 20 per cent on qualifying expenditure of up to €15 million, subject to European Commission approval.

The Department of Education allocation is €10.5 billion in 2025. The Department of Children, Equality, Disability, Integration and Youth allocation is €8.1 billion.

Free schoolbooks for Senior Cycle students

The free schoolbooks scheme will be extended to all Transition Year and Senior Cycle students within the free education scheme from September 2025.

State exams

There will be no fees for Junior Cycle and Senior Cycle students sitting State examinations in 2025.

Special educational needs

Funding for:

• 768 extra special education teachers working across various SEN settings including special classes, special schools, and mainstream settings
• 1,600 additional special needs assistants (SNAs) working across primary, post-primary and special schools (September 2025)

Smartphone-free initiative in schools

Funding for a Keeping Childhood Smartphone Free initiative to make post primary schools smartphone free.

Hot school meals

The Hot School Meal programme will be extended to all remaining primary schools on a phased basis from April 2025. A new ‘school meals holiday hunger’ pilot project will be introduced in summer 2025.

Student contributions

The student contribution fee will be reduced by €1,000 for students in the 2024/2025 academic year.

The apprenticeship fee contribution will be reduced by 33%.

The postgraduate fee contribution grant will increase from €4,000 to €5,000.

Student grants and thresholds

The Standard Rate Maintenance Grant income thresholds and Student Contribution Grant income thresholds for the Student Grant will increase by 15% (September 2025).

The income threshold for the special rate of maintenance grant will increase from €26,200 to €27,400 (September 2025).

The postgraduate fee contribution threshold and the Student Part-Time Fee Scheme threshold will increase to match the new 100 per cent Student Contribution threshold of €64,315 (September 2025).

The Department of Housing, Local Government and Heritage budget allocation is 7.9 billion for 2025.

Help-to-Buy Scheme

The Help to Buy Scheme (HTB) has been extended to the end of 2029. It was due to end on 31 December 2025.

Mortgage Interest Tax Credit

The Mortgage Interest Tax Credit for 2023 has been extended for 2024. This tax credit is for homeowners who had an outstanding mortgage balance of between €80,000 and €500,000 on their primary home on 31 December 2022.

The Mortgage Interest Tax Credit is available on the increased interest you pay on your mortgage in 2024 when compared with the amount you paid in 2022. The tax relief on the increase will be 20%, which is the standard income tax rate, and it will be capped at €1,250.

Rent Tax Credit

The Rent Tax Credit for people paying for private rented accommodation will be increased by €250 for 2024 and 2025. This brings it to €1,000 for an individual and €2,000 for a couple who are jointly assessed for tax.

Stamp Duty

Stamp duty for people who buy 10 or more residential houses in a year, will increase from 10% to 15%. This will take immediate effect.

New stamp duty rate of 6% introduced for residential properties valued at more than €1.5 million. This 6% rate will apply to the amount you pay above €1.5 million and the lower rates apply to the amounts below this. This change will take immediate effect.

Tax relief for pre-letting expenses for landlords

The tax relief for pre-letting expenses for landlords who bring vacant homes into the rental market has been extended to the end of 2027.

Vacant Homes Tax

Vacant Homes Tax will increase from 5 to 7 times the property’s existing base Local Property Tax rate. The increase will take effect from the next chargeable period, starting this November.

Heat pumps

The VAT charged for installing a heat pump will be reduced from the standard rate at 23% to the 9% reduced rate from 1 January 2025.

Social and affordable housing

In 2025, 10,000 new build social homes are expected to be built. There will also be 7,400 new social housing leases. A further 2,165 new social homes will be delivered by local authorities and approved housing bodies (AHBs) using various leasing schemes, such as Mortgage to Rent and the Repair and Leasing Scheme.

Over 6,400 affordable and cost rental homes will be delivered through the First Home Scheme and other schemes that support the Land Development Authority, local authorities and approved housing bodies to build affordable and cost rental homes.

In 2025, the Housing Assistance Payment (HAP) scheme will provide 8,400 new HAP tenancies and support 50,000 existing HAP tenancies. And the Rental Accommodation Scheme (RAS) will support 1,600 new RAS tenancies next year in addition to the 16,000 households already in the scheme.

Supports for homeless people

Funding of €303 million has been allocated to homeless services in 2025. This will support local authorities providing emergency accommodation and other services and help people to exit homelessness, such as Housing First.

Regeneration, adaptations and remediation

In 2025, continued funding has been allocated for:

• Grants to adapt the homes of older people and people with a disability
• Retrofitting approximately 2,500 social homes to a Building Energy Rating (BER) of B2 or equivalent
• Remediation of homes affected by defects, such as pyrite, defective concrete blocks or defects in apartments
• Remediation of over 2,300 void social housing units for re-letting to households on housing waiting lists

All domestic electricity customers will get €250 off their electricity bills. The Electricity Account Credit will be paid in 2 instalments. The first payment will be made before the end of 2024, the second will be made in the new year.

The reduced 9% VAT rate for gas and electricity will be extended until 30 April 2025.

The Department of Health budget allocation is €25.76 billion. This will support new measures, including:

• 335 new hospital beds and 160 community beds
• 2 new surgical hubs
• Increase in training places for GPs and nurses
• 49 new consultant posts
• A Varicella (Chicken Pox) vaccination programme for children
• Implementation of the new National Adult Palliative Care Policy

Hormone Replacement Therapy (HRT)

A new scheme to provide access to free Hormone Replacement Therapy (HRT) for women with symptoms of menopause.

Bowl Screen

Free bowel screening will be expanded to include people aged 58-70. It is currently available for people aged 59-69.

Mental health

An additional allocation of €16 million for mental health services including:

• Youth mental health such as increased access to Child and Adolescent Mental Health Services (CAMHS)
• Suicide prevention services
• Traveller mental health initiatives
• The expansion of eligibility for counselling in Primary Care

HSE Assisted Human Reproduction services

The free HSE Assisted Human Reproduction scheme will be expanded to provide increased access to IVF treatments.

Older people

Allocations for health services for older people include:

• 600,000 additional home support hours
• Increased nursing home places
• Implementation of the National Dementia Strategy

Disability

Funding for people with disabilities and related supports includes:

• 70 additional residential places to support people transitioning from congregated settings and people under-65 from nursing homes to more appropriate housing in the community
• The development of new Autism Innovation Fund for local community groups supporting autistic children and adults
• Staff for Children’s Disability Network Teams (CDNTs)
• Expansion of the Decision Support Service
• Increased funding for the National Disability Authority

CervicalCheck payments

Payments made to women affected by failures in the CervicalCheck programme will be exempt from income tax, Capital Gains Tax and Capital Acquisitions Tax.

Foster Care Allowance

A once-off double payment of Foster Care Allowance. Funding for a new initial placement allowance to support foster carers with the costs of beginning to care for a new foster child.

The Department of Transport has been allocated €3.9 billion in 2025. This includes funding for:

• Increased capacity on existing public transport routes
• BusConnects and town services including new town bus services in Ennis and Mullingar
• Cycling and walking infrastructure
• Active Travel Investment Programme projects in local authorities around the country
• Expansion of greenways
• Road safety measures
• The Road Safety Authority (RSA) for awareness, education and promotional campaigns (€18 million)
• A new, dedicated Road Safety Office to run road safety awareness, education and promotional campaigns. The RSA’s remit will change to become a Driver and Vehicle Services Agency focusing on driver licencing and testing services
• Work on major road projects including the M50 Traffic control and management upgrade and N5 Ballaghaderreen to Scramoge
• A new Coast Guard Search and Rescue contract
• Vehicle and infrastructure grants to support the uptake of Low Emission Vehicles
• The Zero Emission Vehicles Ireland office
• The heavy and light rail network and projects under the DART+ programme, Cork Area Commuter Rail Programme, and continued construction on train stations such as Galway Ceannt
• Support for regional airports through the Regional Airports Programme
• The continuation of the Safe Routes to School Programme at 275 schools

Public transport fares

The 20% reduction in public transport fares will continue in 2025.

The 50% price reduction on the Young Adult Leap Card for people aged 19-25 and the 90-minute fare will continue in 2025.

Free public transport will be extended to children between 5 and 8 years of age.

Vehicle Registration Tax (VRT) for commercial electric vehicles 

An emissions-based approach to VRT for category B commercial vehicles is being introduced. This will introduce a lower 8% rate for category B vehicles with CO2 emissions of less than 120 grams per kilometre.

The weight carriage ratio for electric commercial vehicles is changing to enable them to qualify for the VRT rate of €200.

Emission thresholds for vehicle capital allowances 

CO2 thresholds for claiming capital allowances on business cars are being reduced. From 1 January 2027, an expenditure of €24,000 will be allowable for cars with CO2 emissions of 0-120g/km. A reduced amount of €12,000 will be allowable for vehicles with CO2 emissions of 121-140g/km. There will be no allowable expenditure for vehicles with emissions >141g/km.

Benefit-in-Kind (BIK)

The temporary universal relief of €10,000 on the Original Market Value of a vehicle (including vans) for vehicles in Category A-D with emissions below 180kg/km will be extended to 31 December 2025.

An employee with an electric company vehicle will have an overall BIK relief of €45,000 in 2025 which includes the €35,000 electric vehicle-specific relief (already in law) plus the additional temporary universal relief of €10,000.

A BIK exemption will apply to the provision of electric vehicle chargers at the home of a director or an employee.

Other announcements

The scheme for Gas and Hydrogen-powered vehicles will be extended for another year.

The Motor Insurers Insolvency Compensation Fund levy will be reduced from 1% to 0% from 1 January 2025.

The Department of Justice has an allocation of €3.9 billion in 2025 which includes:

• €3.2 million for youth justice initiatives
• An additional €9 million for criminal legal aid in 2025 which includes an 8% increase in fees (1 January 2025)
• €1.35 billion for the Defence Forces

Garda Síochána allocation includes:

• Recruitment of an extra 1,000 trainee Gardaí and 150 civilian staff
• Garda trainee allowance will increase to €354 per week (1 October 2024)
• A 13% increase to the Garda overtime budget
• €5 million for Public Order Units
• €100 million funding for ICT including nationwide roll-out of body worn cameras and the introduction of facial recognition technology

Prison and Probation Service

Funding provided to:

• Recruit 150 extra prison service staff in 2025
• Increase spending on prisoner care and rehabilitation
• The Probation Service for expansion of crime diversion programmes, step down facilities, restorative justice, and community-based alternatives to imprisonment

Domestic and gender-based violence 

€7.9 million for domestic, sexual and gender-based violence initiatives including increased funding for Cuan (the statutory agency dedicated to tackling and reducing domestic, sexual and gender-based violence).

New agencies under the Department of Justice 

Funding to establish new agencies including the:

• Office of the Police Ombudsman
• Office of the Independent Examiner
• National Office of Community Safety
• Gambling Regulatory Authority of Ireland.

EU Presidency

Ireland will assume the rotating Presidency of the Council of the European Union on 1 July 2026. €10 million has been allocated for additional staffing and other resources for Ireland’s EU Presidency.

International protection 

Funding provided to:

• Support the implementation of the Comprehensive Accommodation Strategy, which aims to scale up the capacity of accommodation centres to 35,000 by the end of 2028
• Continue to support Beneficiaries of Temporary Protection (BOTPs) and people seeking international protection
• Fund Local Authority Integration Teams (LAITs) in 31 local authorities to support the integration of International Protection applicants, programme refugees, Beneficiaries of Temporary Protection (BOTPs) and people with refugee status in Ireland (€50 million)
• Roll out the International Protection Child Payment for children under the age of 18 (€8.4 million)
• Invest in the immigration system and preparation for the introduction of the EU Asylum and Migration Pact requirements in 2026

Irish Aid and climate finance

Irish Aid, the Government’s Official Development Assistance (ODA) programme, has been allocated an additional €35 million, bringing its total budget to €810 million (4.5% increase).  €35 million has been allocated to international climate finance, meeting Ireland’s commitment to provide annual climate finance funding of €225 million by 2025.

Global Ireland initiatives 

€35 million allocated to Global Ireland initiatives, including opening new embassies and missions overseas in Serbia, Bosnia and Herzegovina, and Moldova, and Consulate Generals in Malaga and Melbourne.