We are pleased to bring you our summary of the tax measures set out in Budget 2019.
The Budget speech focused more on spending announcements than on taxation measures. The personal tax changes announced are modest and aimed at low- and middle-income earners. There were few new taxation measures announced for businesses, but the Brexit supports announced may be of benefit to some. Budget 2019 sees the first indication of the Government’s approach to implementing the Anti-Tax Avoidance Directive with the introduction of an exit tax and the promised introduction of controlled foreign companies rules. More changes are expected in Finance Bill 2018, which is to be announced on 18 October.
Should you have any taxation or business questions, our experienced team will be happy to share their insights with you.
Summary of measures
Personal Tax
- Modest changes to USC
- Income tax rates remain the same
- Increase to the income tax standard rate bands
- Increase to earned income credit of €200 for self-employed individuals
- Increase in home carer tax credit
- Relief for 100% of interest paid by landlords on residential properties with effect from 1 January 2019
Business Tax
- Extension of three-year exemption from corporation tax
- Changes to the Key Employee Engagement Programme introduced last year which treats profits as subject to capital gains tax in place of income tax
- 0% benefit-in-kind for electric vehicles of up to €50,000 extended for three years
- Accelerated capital allowances for employer-provided fitness and childcare facilities
- Accelerated capital allowances for gas-propelled vehicles and refuelling equipment
- Exit tax of 12.5% on unrealised gains for companies that migrate or transfer assets offshore
- Finance Bill to introduce controlled foreign company rules
- Increase in employer contribution to National Training Fund levy
VAT
- The reduced 9% rate of VAT has been increased to 13.5%, with some exceptions
- Reduction in VAT rate of online publications from 23% to 9%
Capital Acquisitions Tax
- Tax-free threshold for gifts/inheritances from parents to children increased from €310,000 to €320,000
Other Taxes
- Price of 20 cigarettes to rise by 50c from midnight 9 October 2018
- All tobacco products will be chargeable to a minimum excise duty of €11 even if sold at a price lower than this
- 1% VRT surcharge on diesel vehicles registered from 1 January 2019
