A brief summary of the ROI Budget 2021 measures announced by the Finance Minister yesterday, 13 Oct 2020:-
PERSONAL TAX
No changes to IT rates
Increase in Earned Income Credit from €1,500 to €1,650
Increase in Dependant Relative Credit from €70 to €245
Increase in 2% band to €20,687 only wef 1 Jan 2021
Working from home – tax deductions for employees for unreimbursed utilities expenses (L&H, Broadband)
BUSINESS TAX
Corporation tax rate remains at 12.5%
Debt Warehousing to include repayments of TWSS owed by employers, 2019 Balance of IT & 2020 Preliminary tax liabilities for adversely affected self-assessed taxpayers – deferral of debts 12 months interest free, with 3% charged thereafter
Reduction in VAT rate to 9% for Tourism & Hospitality sectors wef 1 Nov 2020 until Dec 2021
Increase in Farmers Flat Rate Addition from 5.4% to 5.6% wef 1 Jan 2021
New COVID Restrictions Support Scheme (CRSS) to provide advance trading expense credit in the form of a cash payment: 10% of 2019 average weekly turnover up to €1m & 5% thereafter up to a max €5k per week for eligible businesses forced to close temporarily and those with significantly reduced levels of trade due to COVID restrictions (level 3 or higher)
Employer’s PRSI weekly income threshold increase from €394 to €398 for higher rate employer’s PRSI wef 1 Jan 2021
Knowledge Development Box is being extended until Dec 2022
A new tax credit for the Digital gaming sector wef 1 Jan 2022
PROPERTY TAX
Help to Buy scheme additional measures extended until end of 2021
Stamp Duty (“SD”) Refund Scheme on residential development of acquired non-residential land extended until end of Dec 2022 [30 mths timescale]
SD relief for the transfer of agricultural land to family members at 1% is extended to Dec 2023
Farm consolidation relief attracting 1% SD extended to Dec 2022
A commercial rates waiver for the final QTR of 2020
OTHER
No changes to CGT rates.
Entrepreneurs’ relief CGT 10% rate – a slight change to the ownership requirements to at least 5% for any continuous period of 3 yrs wef Jan 2021
No changes to CAT rates or thresholds.
Excise duty - Increase of 50c on pack of 20 cigarettes and pro-rata increase on other tobacco products from midnight Budget Day
A new VRT regime to be introduced from Jan 2021
The rate of Carbon tax will increase by €7.50 to €33.50 p/tonne from midnight Budget Day for auto-fuels only and 1 May 2021 for other fuels