Posted on 16th October 2014 by Accountant

You will find below some most important changes in Irish Finance Budget 2015 which will effect majority of population in Ireland. For more information and full list of changes please visit website of Irish Department of Finance here.

SUMMARY

Income Tax

Standard rate band of income tax increases by €1,000 to €33,800 for single individuals and to €42,800 for married one.
The higher rate of income tax reduces 40%.

USC

Incomes/salaries less then €12,012/year are exempt from USC.

    USC rates for people with income/salary more than €12,012/year:

  • 1.5% on  all income from 0 up to  €12,012
  • 3.5% on earnings between  €12,013 and  €17,576
  • 7% on any income between   €17,577 and €70,043
  • 8% on any income over €70,044 to €100,000
  • 11% on self employed earnings over €100,000

Medical card holders earning less than €60,000/year, will now pay a maximum rate of 3.5% USC.
People older than 70 years and earning less than €60,000/year, will pay a maximum rate of 3.5% USC.

Artists’ Exemption

The threshold for the artists’ exemption will be increased by €10,000 to €50,000.

Unemployed – Start-Up Relief for Entrepreneurs

The scheme is being rebranded as “Start-Up Relief for Entrepreneurs” (SURE) and being extended to individuals who have been unemployed up to 2 years.

Water Charges

If you are paying income tax, you can get maximum of €100 tax back/deduction for the year 2015. You will be able to claim this tax relief in the tax year 2016.
I think it means that Self-Employed people will be able to claim water charges relief for the first time in the year 2017, when they will be filing tax return for 2016.

Rent-a-room scheme

If you are renting out a room in your principal private residence, your rent income for room is exempt up to €12,000 per year.

Home Renovation Incentive (HRI)

The HRI now include rental properties owned by landlords which are subject to income tax.

VAT

2015 Place of Supply Changes
Cross-border EU telecommunications, broadcasting and electronically supplied services will be charged to VAT in the Member State of the consumer and not the supplier from 1st January 2015.
Increase in the Farmer’s Flat-Rate Addition to 5.2%
The flat-rate scheme compensates unregistered farmers for VAT incurred on their farming inputs. The farmer’s flat-rate addition will increase to 5.2% with effect from 1st January 2015.

3 Year Relief for Start-up Companies

Relief from corporation tax on trading income is available for new start-up companies in the first 3 years of trading.

The value of the relief is linked to the amount of Employers’ PRSI paid by a company in respect of its employees. Maximum of €5,000 per employee and an overall limit of €40,000 in any year.

Tobacco Products Tax (TPT)

You are paying 40 cent more for a packet of 20 cigarette and 20 cent more for a 25g pack of roll-your-own tobacco from 15th October 2014.

Vehicle Registration Tax (VRT)

The VRT reliefs are available for hybrid electric vehicles, plug-in hybrid electric vehicles, plug-in electric vehicles, and electric motorcycles up to 31st December 2016.