Highlights of Taxation Measures in Budget 2019

USC

• The 2% band is increased by €502 to €19,874, i.e. income from €12,012 to €19,784 @ 2%
• The rate for the band €19,875 to €70,044 is reduced from 4.75% to 4.5%

Income Tax

• The standard rate band is increased by €750 to €35,300 for single people and to €44,400 for single income married couples
• The Home Carer Credit is increased from €1,200 to €1,500
• The Earned Income Credit for self-employed people is increased from €1,150 to €1,300
• Income averaging to be available to farmers with off-farm income
• Farmers stock relief extended by 3 years to the end of 2021
• Amount of interest deductible against rental income restored to 100%

Key employee engagement programme (KEEP)

• The maximum amount that may be awarded to employees is increased from 50% of Salary to 100%
• The 3 year limit is to be replaced with a lifetime limit
• The total amount of share options that can be granted is increased from €250,000 to €300,000

VAT

• The rate of VAT on tourism activities is increased from 9% to 13.5%
• Newspapers and sports facilities remain at 9% and the rate on electronic publications is reduced to 9%

Capital Acquisitions Tax

• The Class A threshold (parents to children) is increased from €310,000 to €320,000 on and from 10 October

Corporation Tax

• The 3 year relief for start-up companies is being extended to the end of 2021
• Film relief which was due to end in 2020 is being extended to the end of 2024. In addition a tapered regional uplift is to be given for productions made in regional development areas.
• Accelerated capital allowances are to be given for employer provided fitness and childcare facilities
• Accelerated capital allowances will be given for gas-propelled commercial vehicles
• A 12.5% exit tax will be imposed on unrealised gains of companies that migrate or transfer assets offshore
• Controlled foreign company (CFC) rules will be introduced to prevent diversion of profits to offshore entities

Stamp Duty

• The young trained farmers relief is being extended to the end of 2021

Employers PRSI

• The threshold for the higher rate is raised from €376 pw to €386 pw.

The Minister also announced that there would be measures in the Finance Bill to increase the efficiency and effectiveness of the Employment and Investment Incentive Scheme (EIIS).