Budget 2024 (announced on 10th October 2023) contains a range of benefits for employees, including tax credits, changes to some tax bands and rates, with benefits for renters and home-owners.
There are also significant benefits in relation to educational grants and child care, along with further energy credits for homes.
Many of the changes come into effect from January 2024, those that come into effect in 2023 or later in 2024 are indicated below:
LIST OF KEY BENEFITS AND CHANGES
Taxation of Income
- Income tax rates will remain at 20% and 40%
- The standard 20% tax band increases by €2,000 to €42,000 for single persons, with proportional increases for others.
- Several tax credits will rise by €100.
- The ceiling for the 2% Universal Social Charge (USC) band will increase by €2,840 from €22,920 to €25,760. The higher 4.5% USC rate will be reduced to 4%.
- The reduced rate of USC for medical card holders is being extended until 31 December 2025. Reduced rates of USC apply to people who have a full medical card and an income of €60,000 or less a year.
These changes mean a single person earning €46,000 in 2024 will see an increase of €2,000 in their net income as a result of cumulative income tax changes and USC changes. compared to previous years.
Housing & Homes
- Rent tax credit increases from €500 to €750 per year.
- A one-year Mortgage Interest Tax relief, capped at €1,250 per property, will be introduced for homeowners with an outstanding mortgage balance on their primary dwelling of between €80,000 and €500,000 as of 31 December 2022
- The Help to Buy Scheme is extended to the end of 2025, with amendments to include applicants of the Local Authority Purchase Scheme.
- All domestic electricity customers will get €450 off their electricity bills. The energy credit will be paid in 3 instalments of €150. The first payment will be made in December 2023, the second will be made in January 2024 and the third will be made in March 2024.
- Extension of the 9% VAT rate for gas and electricity for an additional 12 months
- The minimum wage increases by €1.40 to €12.70 per hour.
- All PRSI rates rise by 0.1% on October 1st 2024
- Parental leave is extended by 2 weeks to 9 weeks from August 2024.
- All weekly social welfare payments are to rise by €12.
- Qualified child rates see an increase of €4 for children under and over 12 years of age.
- A double payment of child benefit will be paid in December 2023
- Child benefit will be extended to age 18 for children in full-time education
- The Carer’s Allowance income disregard will increase to €450 for a single person and €900 for a couple from June 2024.
- A Christmas Bonus of 100% will be paid in early December 2023 to people in receipt of a qualifying social welfare payment.
Education and Training
- The hot school meals programme will be extended to a further 900 schools.
- The student contribution, for third level education and training, will be reduced by €1,000 in the 2023/2024 academic year, for students who qualify for the Free Fees Scheme. From September 2024, the Student Contribution fee will be abolished for all incomes under €55,924. Maintenance grant rates are to rise.
- There will be a 33% reduction in the contribution fee for apprentices in higher education (2023/2024 academic year) along with an increase in craft apprenticeship scheme places.
- Continued reduced fares and VRT Relief is extended for battery electric vehicles.
- The carbon tax for auto fuels will increase from €48.50 per tonne to €56 per tonne from October 11th. The measure will add 2.5c and 2.1c to diesel and petrol respectively. Carbon tax for all other fuels will increase from 1 May 2024.
- The temporary excise rate reductions on auto diesel, petrol and marked gas oil will be extended until 31 March 2024.
We’ve provided you with the most relevant aspects of Budget 2024, the full details are available from the government’s revenue website.
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