Budget 2027 Ireland: your take-home pay, and what else changed

Budget 2027 includes reductions in income tax and USC for many workers, with no change to the headline 20% and 40% rates. The Government widened the standard-rate band, lifted the main tax credits and adjusted the USC bands — so most PAYE workers keep a little more of their pay from January. Here's exactly what changed, and roughly what it's worth to you.

Measure	2026	2027 (proposed)
Standard-rate band — single	€44,000	€46,500
Standard-rate band — married, one income	€53,000	€55,500
Personal Tax Credit	€2,000	€2,125
Employee (PAYE) Tax Credit	€2,000	€2,125
Earned Income Credit (self-employed)	€2,000	€2,125
Home Carer Tax Credit	€1,950	€2,050
USC 2% band ceiling	€28,700	€30,300
Rent Tax Credit — single	€1,000	€1,150
Income tax rates (20% / 40%)	unchanged	unchanged

All effective 1 January 2027 if enacted. Married two-income and single-parent bands also rise — see below.

The point where your income starts being taxed at 40% — your standard-rate cut-off point — goes up by €2,500 for every family type:

Situation	2026 cut-off	2027 cut-off
Single / widowed	€44,000	€46,500
Single parent (SPCCC)	€48,000	€50,500
Married, one income	€53,000	€55,500
Married, two incomes	up to €88,000	up to €93,000

Widening the band means €2,500 of income that was taxed at 40% is now taxed at 20% — a saving of up to €500 a year in income tax for anyone earning above the new cut-off. For the two-income married band, the transferable increase rises from €35,000 to €37,500 (still the lower of that or the second earner's income, and still non-transferable).

The three main credits each rise by €125, and the Home Carer Credit by €100:

• Personal Tax Credit: €2,000 → €2,125
• Employee (PAYE) Tax Credit: €2,000 → €2,125
• Earned Income Credit (self-employed): €2,000 → €2,125
• Home Carer Tax Credit: €1,950 → €2,050

Because credits come straight off your tax bill, a single PAYE worker's combined Personal + Employee credits rise from €4,000 to €4,250 — worth up to €250 a year to workers with enough Income Tax liability to use the full increase.

USC rates are unchanged, but the ceiling of the 2% band rises by €1,600, from €28,700 to €30,300. This keeps full-time workers on the increased minimum wage out of the higher 3% USC rate. The 2027 USC bands:

Rate	2027 band
0.5%	€0 – €12,012
2%	€12,012 – €30,300
3%	€30,300 – €70,044
8%	Over €70,044

The €13,000 USC exemption threshold is unchanged, as is the 3% surcharge on self-employed non-PAYE income over €100,000. Moving €1,600 from the 3% band to the 2% band saves most middle earners about €16 a year in USC. See our USC explainer for how the bands stack.

Budget 2027 doesn't introduce new PRSI measures so much as confirm the already-agreed roadmap of gradual increases. The employee Class A PRSI rate, which rose to 4.35% on 1 October 2026, is set to rise again to 4.5% from 1 October 2027. The weekly threshold for the higher rate of employer PRSI rises from €552 to €600.

Combining the band widening, the €250 credit increase and the USC change, here's roughly how much better off a single PAYE employee is in 2027 (income tax + USC only):

Gross salary	Better off / year	≈ per month
€30,000	+€263	≈ €22
€45,000	+€466	≈ €39
€60,000	+€766	≈ €64
€90,000	+€766	≈ €64

The benefit tops out around €766 once you earn enough to use the full widened band. Someone on €90,000 gains the same as someone on €60,000, because the rates themselves didn't change — higher earners don't get extra relief. These are estimates for a single PAYE worker with standard credits and no pension; your own figure depends on your circumstances.

Budget 2027 changed more than income tax. Here are the measures most likely to affect your money — and, importantly, when each one starts, because they don't all begin in January.

🏛️ Inheritance & gift tax (CAT) — already in effect

The tax-free CAT thresholds rose for gifts and inheritances taken on or after 7 October 2026. The 33% rate is unchanged.

CAT group	Before	From 7 Oct 2026
Group A (child)	€400,000	€420,000
Group B (relative)	€40,000	€44,000
Group C (other)	€20,000	€22,000

Work out a specific gift or inheritance with our Inheritance Tax (CAT) calculator, updated for the new thresholds.

📈 Capital Gains Tax (CGT) — already in effect

The standard CGT rate was cut from 33% to 31% for disposals made on or after 7 October 2026. The rate on disposals of development land is unchanged. CGT applies when you sell or dispose of an asset (shares, a second property, etc.) at a gain above your annual exemption.

🏠 Renters & homeowners

• Rent Tax Credit rises to €1,150 for a single renter and €2,300 for a jointly assessed couple (2027 tax year) — up from €1,000 / €2,000.
• Rent-a-Room relief rises from €14,000 to €16,000 of tax-free rental income from renting a room in your own home.
• Help to Buy — the maximum refund for first-time buyers rises by €5,000 to €35,000, applying from 7 October 2026.

💶 National minimum wage

The minimum wage rises by 79c to €14.94 an hour from 1 January 2027 (up from €14.15). The USC 2% band was widened to €30,300 partly to keep full-time minimum-wage workers out of the higher USC rate.

🚗 Company cars (benefit-in-kind)

If you drive a company car, the OMV reductions that lower your taxable BIK are tapering down on the previously-legislated timetable for 2027:

OMV reduction	2026	2027
General reduction (all cars)	€10,000	€5,000
Electric-vehicle reduction	€20,000	€10,000
Combined EV reduction	€30,000	€15,000

A smaller reduction means a higher taxable value, so many company-car drivers — EV drivers especially — will see higher BIK in 2027. Our BIK calculator now lets you compare 2026 and 2027 OMV reliefs, including electric cars and vans.

🧾 Social welfare

Budget 2027 also included weekly social-welfare increases and cost-of-living supports. Those don't show on a payslip, so they're outside this guide's scope — see the official sources below for the full list.

If enacted as announced, the income tax and USC changes apply to income from 1 January 2027, so you'd first see them in your January 2027 payslip. Until the Finance Bill passes, nothing changes in your current pay.

Are the Budget 2027 figures final?

No. They're the measures announced on Budget day, 6 October 2026. They're expected to take effect from 1 January 2027 but remain proposals until the Finance Bill is enacted, so some detail can still change.

How much better off will I be?

For a single PAYE worker, roughly €263 a year at €30,000, €466 at €45,000, and about €766 once you earn €60,000 or more — from the income tax and USC changes. The exact figure depends on your status, credits and pension.

Did the 20% and 40% income tax rates change?

No. The rates are unchanged. The saving comes from a wider standard-rate band (€44,000 → €46,500 for a single person), higher tax credits (+€125 each) and a wider USC 2% band.

Why do higher earners get the same benefit as someone on €60,000?

Because the relief comes from widening the band and raising credits by fixed amounts, not from cutting the rates. Once you fully use the widened band, there's no further gain, so the benefit caps out at about €766 a year.

Which Budget 2027 changes are already in effect?

Three apply from 7 October 2026 — not next January: the higher CAT inheritance thresholds (€420,000 / €44,000 / €22,000), the lower CGT rate (33% → 31%, development land unchanged), and the higher Help to Buy limit (€35,000). The income-tax, USC, Rent Tax Credit, minimum-wage and company-car BIK changes are for 2027, from 1 January; the next employee PRSI increase is scheduled separately for 1 October 2027.

Did inheritance tax or CGT change?

Yes. The CAT (inheritance/gift) tax-free thresholds rose for benefits taken on or after 7 October 2026 — see our inheritance tax calculator. The standard Capital Gains Tax rate dropped from 33% to 31% for disposals on or after the same date, with development land unchanged.

This page summarises Budget 2027 announcements for general information only. The take-home-pay measures are proposals pending the Finance Bill and may change before becoming law; the CAT, CGT and Help to Buy changes apply from 7 October 2026. It is not tax advice. For your situation, check Revenue.ie or a qualified adviser.

This page is independently maintained by TakeHomePay.ie, based on the Budget 2027 Tax Policy Changes document published by the Department of Finance and corroborating professional and news coverage, cross-checked against our own calculator logic. The take-home-pay worked examples were computed from the announced 2027 bands, credits and USC and reconcile with published estimates; the CAT and CGT changes were checked against Revenue and Citizens Information.

Published: 7 October 2026
Status: Take-home-pay measures are proposals pending the Finance Bill; CAT, CGT and Help to Buy apply from 7 October 2026
Maintained by: The TakeHomePay.ie team

Official sources

• Department of Finance — Budget 2027 Tax Policy Changes (PDF)
• Citizens Information — Budget 2027
• Revenue — CAT group thresholds
• Revenue.ie — rates, bands and credits