Budget 2018: The Key Tax Points

Here are the main tax points of Minister Paschal Donohoe’s Budget 2018 Speech, announced this afternoon.

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  • Stamp Duty on non-residential commercial property increases from 2% to 6% with immediate effect. A Stamp Duty refund scheme will apply to land purchased for the construction of housing.
  • The 7 year ownership period for the Capital Gains Tax exemption introduced by Minister Michael Noonan is cut to 4 years.
  • The Vacant Site Levy increases from 3% to 7% in second and subsequent years.
  • For residential lettings, a new time limited deduction for pre-letting expenses will be introduced.
  • Mortgage interest relief will reduce to 75% of the existing relief in 2018, then 50% in 2019 and 25% in 2020
  • There will be a new tax on sugar-sweetened drinks.
  • There will be a VAT increase on the use of sunbeds.  They will now be subject to VAT at the standard rate of 23%.
  • The special 9% VAT rate for the tourism and services sector will remain.
  • A new VAT refund scheme will apply to charities.
  • The standard rate tax band for income tax increases to €34,550.
  • The 2.5% rate of USC will fall to 2% and the ceiling for this rate will increase.
  • The 5% rate of USC will fall to 4.75%
  • The Earned Income Credit will increase by €250 to €1,200.
  • A new Key Employee Engagement Programme (KEEP) will allow small businesses grant employee share options
  • The Home Carer Tax Credit will increase by €100 to €1,200.
  • A new restriction will apply to Corporation Tax capital allowances for intangible assets. These will be limited to 80% of the income arising from the intangible asset in a given year.