Budget 2020 for the upcoming year was released at the start of the week. The main focus on the budget is preparing for a no-deal Brexit with a package worth 1.2 billion euro. We saw the usual increases in areas such as cigarette prices and cuts to prescription charges. Below is our list of the main points we feel affect us either from a business or personal level.
The Farm restructuring relief program will be extended until 2022. The Government will also be investing €2 billion in rural Ireland next year, this includes €51 million more form the Department of Agriculture. A further €3 million will go to pilot new agri-environmental schemes in 2020 to reduce emissions in the sector, another big focus of the Budget 2020.
Nearly €1 billion will go to the Department of Business, this includes €10 million for a disruptive technologies fund and another €600 million for a Brexit loan and growth scheme. Minister Donohoe will increase the Research and Development tax credit for small and micro companies from 25% to 30%. There’s an increase to the qualifying production cap for microbreweries from 40,000 to 50,000 hectolitres, and a relief for small independent bookmakers up to €50,000 a year from the betting duty.
€1.5bn will be transferred into the ‘Rainy day fund’ from Ireland’s Strategic Investment Fund. The additional €500m from the exchequer will not be transferred this year, Mr Donohoe decided.
Additional funding to the value of €2 million will be used to step up the powers of the Residential Tenancies Board. The stamp duty rate for non-residential property has increased from 6% to 7.5%. This simply means that the stamp duty payable when purchasing non-residential property is now 7.5% of the purchase price. The help-to-buy scheme for people trying to get a start on the property ladder will be extended until 2021 with no further adjustments.
Unfortunately, there were no broad tax cuts announced in the Budget 2020, but there were some interesting takeaways. Minister Donohoe announced for self-employed individuals an increase in Earned Income Credit by €150, to bring the value to €1,500. There will be an increase in the Dividend Withholding Tax from 20% to 25% from January 1, 2020, and the banking levy will increase from 59% to 170%. The threshold for Capital Acquisitions Tax (CAT) in what is known as the ‘Group A Threshold’ has increased. This means that children can now receive a gift or inheritance up to the amount of €335,000 tax-free from their parents. And lastly, new measures will be announced in the new future to prevent aggressive tax avoidance by Irish Real Estate Funds.
To see the rest of the points made in Budget 2020, click here. If you have any queries related to any of these key points from the Budget 2020, don’t hesitate to contact us here for a confidential consultation.