So how was budget 2015 for you?
Will you be counting the cost or flashing the cash?
The money experts at Taxback.com have listed the significant changes of Budget 2015 and also provided us with a useful budget calculator.
Income Tax
Increase in the standard rate band
by €1,000 from €32,800 to €33,800, for single individual
from €41,800 to €42,800 for a married one-income couple.
Top rate of income tax reduced from 41% to 40%
Universal Social Charges (USC)
Incomes of less than €12,012 are exempt from USC
For incomes of greater than €12,012, USC should be applied at the following rates and bands:
€0 to €12,012 @ 1.5%
€12,013 to €17,756 @ 3.5%
€17,577 to €70,044 @ 7%
€70,044 to €100,000 @ 8%
PAYE income in excess of €100,000 @ 8%
Self-employed income in excess of €100,000 @11%
Extension of the exemption from the 7% rate of USC for medical card holders whose aggregate income does not exceed €60,000, who will now pay a maximum rate of 3.5% USC.
Individuals aged 70 years and over whose aggregate income is €60,000 or less will pay a maximum rate of 3.5% USC.
Employment Related Taxes
Foreign Earnings Deduction (FED)
FED is being extended for a further 3 years until the end of 2017
Qualifying countries are being extended to include Chile, Mexico and some additional countries in the Middle East & Asia
The number of qualifying days abroad is being reduced from 60 to 40
SARP is being extended for a further 3 years until the end of 2017 and the upper salary threshold is being removed.
The residency requirement is being amended to only require Irish residency and the exclusion of work abroad is also removed.
The requirement to have been employed abroad by the employer is reduced to 6 months.
Corporation Tax
Ireland is to introduce a “knowledge development box” similar to that in the US, to further attract FDI
DOUBLE IRISH’ to be abolished with effect from 1 January 2015 for new companies, and to be phased out for existing companies by the end of 2020
Changing the residency rules to require all companies registered in Ireland to also be tax resident
A new strategy for financial services in Ireland will be launched next year
3 year corporation tax relief for start-ups extended
Miscellaneous
1,700 new teaching posts, including 365 special needs assistants
Film tax credit scheme will go ahead in 2015, hopes to increase the €50m cap in 2016
A new ‘Back to Work Family Dividend’ will be introduced to provide an additional incentive for families to move from the welfare system to work. This will allow families to retain the full Qualified Child increase of €29.80 per week per child for 12 months after their return to work and 50% of the payment in the second year.
Water Charges – tax relief at 20% will be provided on water charges, up to a maximum of €500 per annum. This relief will be allowed a year in arrears.
Tobacco – price of packet 20 cigarettes will be increased by 40 cents with effect from midnight on 14 October 2014
No change on alcohol, petrol, diesel and motor tax
Child benefit increased by €5 per month per child, with promise of further €5 increase in Budget 2016
Reduced 9 per cent rate of VAT for tourism industry to be extended
0.6% pension levy to be abolished from the end of 2014, and the additional 0.15% pension levy will expire at the end of 2015
This article was prepared by the taxback.com team for IrishJobs.ie candidates. If you would like to speak with taxback.com about filing an Irish tax return then visit www.taxback.com or email them on info@taxback.com or call them on 056 779 7345