Yesterday marked the 1st of October, the official starting point for Q4 and budget day 2025. During the course of yesterday afternoon, Minister for Finance, Jack Chambers and Minister for Public Expenditure, Paschal Donohue announced a series of measures directed at “putting the country on a firm footing for the future”.  Below is a summary of the key announcements related to business operations that you should take note of: Income Tax: The Universal Social Charge (USC) will be reduced from 4% to 3% on incomes of €25,000 to €70,000. Entry threshold to 3% rate increased by €1,622 to €27,382 The national minimum wage will increase by 80 cent to €13.50 per hour from the 1st of January 2025 The main tax credits - Personal, Employee and Earned Income Credits - will increase by €125 The Standard Rate Cut Off Point will increase by €2,000 to €44,000, with proportionate increases for married couples and civil partners For Capital Gains Tax (CGT) Retirement Relief, the higher age limit will stay, but if you sell assets worth over €10 million, there will be a clawback period of 12 years. After this period, CGT will no longer apply. The Capital Gains Tax relief for investors in innovative start-ups will be improved. The lifetime limit on gains eligible for relief will increase from €3 million to €10 million. For Research & Development (R&D), the tax credit’s first-year payment threshold will increase from €50,000 to €75,000. This will help smaller companies or those using the credit for the first time. Small Benefit Exemption: Employers can now give workers non-cash benefits or rewards worth up to €1,500 (increased from €1,000) without having to pay income tax, PRSI, or USC on it. Company Cars: The €10,000 universal relief for company cars will be extended for another year. Employees with an electric company car will get a total benefit-in-kind (BIK) relief of €45,000 in 2025. This includes €35,000 for electric vehicles and the extra €10,000 temporary relief. Additionally, there will be a BIK exemption for installing electric vehicle chargers at the homes of employees or directors. Other Supports: The Employment Investment Incentive, Start-Up Relief for Entrepreneurs, and Start-Up Capital Incentive will be extended until the end of 2026. The maximum amount an investor can claim under the Employment Investment Incentive will double from €500,000 to €1 million. The relief available under the Start-Up Relief for Entrepreneurs will increase from €700,000 to €980,000. VAT Registration: The VAT registration thresholds are being increased. For the sale of goods, the threshold will go up from €80,000 to €85,000, and for services, it will rise from €40,000 to €42,500. Stock Exchange: A new relief is being introduced to cover expenses for companies listing on an Irish or European stock exchange for the first time, with a limit of €1 million. Need help? We understand that getting a handle on budgetary changes can be daunting particularly when it comes to managing your payroll obligations. If you have questions or need help setting up or running your payroll processes, GroForth can provide practical support. Contact us for details of our payroll services. Sources: https://www.rte.ie/news/budget-2025/2024/1001/1472970-budget-2025-summary/ https://www.irishexaminer.com/business/economy/arid-41487173.html

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