Running a business in Dublin is exciting but staying updated with tax changes is crucial.
If you’ve been wondering how Budget 2025 affects you, you’re not alone.
As your trusted Accountant in Dublin, I’m breaking down the most important updates, so you stay ahead without the confusion.
Let’s dive into the key changes that matter for your business.
📈 Income Tax Changes You Should Know
Standard Rate Band Increase
Good news if you’re an employee or business owner!
The standard rate band has increased by €2,000, which means you can now earn up to €44,000 at the lower tax rate of 20% before jumping to the higher 40% rate.
Why It Matters:
You get to keep more of your hard-earned money before paying higher taxes.
Personal Tax Credits Boost
Several important tax credits have increased:
- Personal Tax Credit: now €2,000 (up from €1,875)
- Employee PAYE Credit: now €2,000
- Earned Income Credit: now €2,000
These boosts help reduce your overall income tax bill, making it easier to manage your finances.
(Source: Revenue.ie)
💼 Universal Social Charge (USC) Just Got Lighter
The USC can feel like a burden, but there’s good news.
The 4% USC rate has dropped to 3% for income between €27,382 and €70,044.
How You Benefit:
If you fall into this bracket, your paycheck will be a little healthier starting this year.
🧾 Higher VAT Thresholds = Less Hassle for Small Businesses
Starting now, the VAT registration thresholds have been increased:
- For Services: from €40,000 to €42,500
- For Goods: from €80,000 to €85,000
Translation:
If your business turnover is below these new limits, you no longer need to register for VAT, saving you time and paperwork!
💰 Capital Acquisitions Tax (CAT) Thresholds Are Up Too
Thinking about passing on wealth to your family?
Here’s what changed:
- Group A (parents to children): up to €400,000
- Group B (siblings, nieces, nephews): up to €40,000
- Group C (friends, distant relatives): up to €20,000
Bottom Line:
Families can now transfer more wealth tax-free — a huge relief for planning your future.
🧪 Bigger Support for Innovation: R&D Tax Credit
If you invest in innovation, here’s something for you.
The first-year R&D tax credit refund limit has increased from €50,000 to €75,000.
Benefit:
Dublin tech companies and startups can claim back more, fueling even faster growth.
🎁 More Employee Rewards with the Small Benefit Exemption
Under the updated Small Benefit Exemption, employers can now:
- Provide up to five non-cash benefits a year
- Claim up to €1,500 tax-free
Perfect for:
Gift vouchers, gym memberships, or tech gadgets to reward your hardworking teams!
🏠 Bigger Rent Tax Credit for Tenants
Renters rejoice! You can now claim up to €1,000 in rent tax credits (or €2,000 if you’re jointly assessed).
Helpful Tip:
Make sure to claim your credits when filing your 2024 and 2025 returns!
🚗 Electric Vehicles: Big Tax Savings
Starting January 2025, if your employer installs a home charger for your electric car, you won’t be hit with Benefit-in-Kind (BIK) taxes.
Encouragement for:
Going green and saving cash at the same time!
🏘️ Vacant Homes Tax Update
If you own a vacant property, be aware:
The Vacant Homes Tax is now seven times the property’s Local Property Tax (LPT).
Tip from your Accountant in Dublin:
Consider selling, renting, or occupying vacant properties to avoid hefty charges.
📣 Final Thoughts: What Should Dublin Businesses Do Next?
Budget 2025 offers some real opportunities — if you plan smartly.
Here’s what you should do:
- Review your income tax and credits.
- Adjust your business planning for new VAT rules.
- Consider succession planning under updated CAT thresholds.
- Explore R&D credits if you innovate.
- Keep track of employee reward schemes and tenant reliefs.
Feeling overwhelmed?
No need to stress — at Accountant in Dublin, we’re here to simplify it for you.
📞 Get in touch today for a free consultation!