Politics
Help to Buy Tax Credit Raised to €35,000 as Budget 2027 Sets New Social Welfare and Tax Changes
By Jane Matthews and Christina Finn
Coalition leaders approved a €5,000 increase to the Help to Buy tax rebate for first‑time buyers, raising the credit from €30,000 to €35,000, as government talks concluded on Monday night. The decision was made ahead of the Budget 2027 announcement scheduled for Tuesday at 1 pm. In addition to the Help to Buy change, a €10 weekly increase to the State pension and a €10 rise to all other core social welfare payments were confirmed. Children’s Allowance will not change, but child support payments will receive an extra €6 per week. A permanent disability payment of €500 and a €5 increase to the fuel allowance were also agreed, along with a Christmas bonus for social welfare recipients.
The entry point for the 40 % higher rate of income tax will move from €44,000 to €46,500, and there will be no change to the Universal Social Charge. Inheritance tax thresholds will rise across all categories: the lifetime limit for children will increase from €400,000 to €420,000; Group B limits will rise from €40,000 to €44,000; and Group C limits will rise from €20,000 to €22,000.
Housing measures include the Help to Buy credit increase, a €2,000 rise in the rent‑a‑room tax‑free allowance to €16,000 per year, and a rise in the Rent Tax Credit from €1,000 to €1,150 for single tenants and from €2,000 to €2,300 for couples. Proposed stamp duty changes for first‑time buyers were rejected.
Childcare support will see a reduction in the maximum monthly cost for full‑time childcare for children up to senior infants, dropping from €735 to €550, potentially saving families up to €2,000 per year. An anti‑child poverty measure will raise the income threshold for free childcare to €34,000.
Health and higher education budgets were negotiated earlier, with the Department of Higher Education securing funding to develop a culture card for 16‑year‑olds, though it is unlikely to be available this year or next. The budget will be presented by money ministers Jack Chambers and Simon Harris to Dáil Éireann on Tuesday afternoon.