Can You Take a Holiday on Next Week’s Budget?
Well, here we are again, holding our breath waiting to see what the chosen few have in store for us in the budget. This year we have a very different kind of Government and many who never had a voice before can now influence the outcome. Do you think it will make any difference to your pocket? What matters to you and does it matter enough for you to speak out?
With the budget looming next week, there appears to be something for everyone in the pot. Even the self-employed seem to be getting a reasonable break.
Here are our highlights from what is predicted so far:
Reduction in Universal Social Charge
We should see a modest reduction of 0.5% in the three lower rates of USC. This will put up to a maximum of €350.22 back in your pocket. This means that if you earn €70,044 or more, you may be better off by €6.73 per week. This will reduce to €3.65 if you are on an average industrial wage of €38,000. If you work 40 hours a week on minimum wage you can expect the princely sum of €1.83. Yay!
Income Tax Credit for Self Employed to Double
The income tax credit for the self-employed is set to increase from €550 to €1,100. Now that the economy is moving again, we need every little boost for new business and entrepreneurs to keep up the momentum. Most self-employed people don’t operate as individuals. They help to create the employment that keeps the wheels turning. Most of them also pay tax in Ireland and keep their money in Ireland, which helps other peripheral businesses. Fair play!
Brexit-proofing for Start-Up Companies
We can expect to see a reduction in Capital Gains Tax to 10% for start-up companies. This will be on earnings up to €10 million. A welcome measure to try and counteract the effect of Brexit on new companies in Ireland. Nobody really knows exactly how business here will be affected when it happens. With Britain moving quickly towards an exit some are getting anxious. A plunge in the value of Sterling last night by 6.2% in 2 minutes on the Asian stock market has shaken some nerves! It did recover fairly quickly to recover most of its losses but it certainly made the headlines.
Social Protection Benefits Extended to the Self-Employed
Now there’s one that will interest many in the business world! For so long now the people who in general pay the most taxes (ie. self-employed and business owners) have little or no entitlement to benefits. They pay Income Tax, VAT, Employers PRSI, Corporation Tax, Relevant Contracts Tax and Capital Gains Tax. What are they entitled to in return? Currently the only benefits available to you if you pay Class S PRSI are Maternity/Adoptive Benefit and the Contributory State Pension. This is one to watch!
Pensioners To get a Fiver
€5 per week increase in the state pension this week will buy you a 5kg bag of potatoes.
First Time Buyer’s Tax Allowance up to €15,000
A proposed Help-to-Buy scheme for first time buyers of new homes may get you a tax rebate of up to €15,000. This might actually help if it can be prevented from pushing up house prices further. It would certainly be a nice boost to your budget if you have to furnish a bare house. What would you buy? A nice suite of furniture for your living room? A nice car for the driveway? A holiday??
Increase in Funding Agreed for New Nurses
The target of an additional 1000 nurses is expected. With ever increasing pressure on emergency departments and hospital trolleys we all agree this is badly needed. But does it go far enough?
Increase in Funding Agreed for New Gardaí
We can expect to see an additional 800 Garda trainees taken on next year. Will this help to stop the proposed Garda strike? I doubt it. The AGSI have lodged a 16.5% pay claim and plan to start industrial action on 4th November. Isn’t it illegal for Gardaí to go on strike? Who remembers the Blue Flu in 1998 when 5000 Gardaí called in sick and the army was put on standby?
Rise in Inheritance Tax Exemption to €320,000
Death and taxes are two things you can be sure of in this life. If you lose a loved one, the planned increase of €40,000 in the inheritance tax exemption might be very welcome. Bereavement is hard enough on people without forcing them to take out a mortgage or sell the family home to pay a tax bill. It is still a long way from the €542,500 that it was in 2009, but it is certainly moving in the right direction.
Whatever predictions you might have or maybe you have something on your wish list – We would like to hear it. Drop us a comment below (But do try to keep it clean!)