Budget 2027: What Does It Mean for Your Money?

The Government has announced Budget 2027, with changes across income tax, investments, inheritance tax, pensions, housing, childcare and the cost of living.

While there is plenty of detail in the Budget, we have picked out some of the key changes that are likely to have the biggest impact on your personal finances.

More of your income will be taxed at 20%

One of the main announcements is an increase in the point at which workers begin paying the higher 40% rate of income tax. For a single person, the standard rate cut-off point will increase by €2,500, from €44,000 to €46,500.

The main tax credits are also increasing. The Personal Tax Credit, Employee Tax Credit and Earned Income Tax Credit will each increase by €125. The USC bands are also being adjusted, with the ceiling for the 2% rate increasing to €30,300. Combined, these changes should mean an improvement in take-home pay for many workers in 2027.

Good news for investors – Exit Tax reduced to 35%

There was welcome news for Irish investors, with the Exit Tax rate on investment funds reduced from 38% to 35%. This follows the reduction from 41% to 38% last year and means the tax payable on investment growth has now fallen by six percentage points over two years with plans to reduce further in future budgets. This is particularly positive for people investing surplus savings outside of a pension, as they will now retain a greater share of their investment returns.

Irish investment account

A new Irish Investment Account is designed to make investing more accessible and simpler for ordinary investors and should be available from 1 July 2027. Irish tax residents aged 18 or over will be able to open an account, with contributions capped at €12,000 p.a. A key feature will be a €50,000 tax-free threshold and an annual tax of 1% above the threshold. The new structure will see participating providers responsible for calculating and paying any tax due.

We will be looking closely at the final legislation and the investment options and available when providers begin launching these accounts.

Capital Gains Tax reduced

There was also welcome news for investors and business owners, with the standard rate of Capital Gains Tax reducing from 33% to 31%. CGT can arise when you dispose of assets such as shares, investment property or certain business assets at a profit, so this reduction could be particularly relevant for people planning to sell investments or assets. As always, tax should not be the only consideration when deciding whether or when to sell an investment.

Inheritance tax thresholds increased

There are also changes to Capital Acquisitions Tax (CAT) – the tax that can apply to gifts and inheritances.

The tax-free lifetime thresholds will increase as follows:

• Group A – typically parent to child: €400,000 → €420,000

• Group B – typically siblings, grandparents, grandchildren, aunts/uncles, nieces/nephews: €40,000 → €44,000

• Group C – other relationships: €20,000 → €22,000

Amounts received above the relevant lifetime threshold remain subject to CAT, currently at 33%.

While these increases are welcome, rising property values mean inheritance tax continues to be an important consideration for many families.

If you have significant property, investments or other assets that you ultimately intend to pass to your children, early estate planning remains important.

State Pension increases

The State Pension will increase by €10 per week, alongside a €10 increase in other core social welfare payments. For those approaching retirement, the State Pension remains an important part of retirement planning – but for many households it will need to be supplemented by occupational pensions, PRSAs, personal pensions and other savings or investments if they want to maintain their standard of living in retirement.

Help for first-time buyers and renters

The maximum available under the Help to Buy scheme will increase from €30,000 to €35,000. The Rent Tax Credit is also increasing to €1,150 for an individual or €2,300 for a couple. The tax-free limit under Rent-a-Room Relief will increase from €14,000 to €16,000 per year.

Childcare costs

For families with younger children, the Government has announced further childcare supports, including a move to cap childcare costs at €550 per month for eligible children. The changes are intended to reduce the cost of full-time childcare by approximately €1,000 per year per child for some families.

Minimum wage

The National Minimum Wage will increase by 79 cent to €14.94 per hour.

The USC bands are being adjusted alongside this increase so that someone working full-time on the minimum wage should not be pushed into the higher USC band simply because of the increase.

Overall, Budget 2027 brings a number of positive changes for households, savers and investors. While some of the individual measures may seem relatively small in isolation, changes to income tax, investment taxation, inheritance tax and pensions can all have an impact on your longer-term financial position. As always, the important thing is to look beyond the headlines and consider what the changes mean for your own circumstances and financial plans. If you are reviewing your pension, investments, retirement plans or how best to use surplus savings, this may be a good opportunity to revisit your overall financial strategy.

The information above is based on Budget 2027 announcements made on 6 October 2026. Some measures remain subject to legislation and further detail. .