May proved to be another positive month for investors, with global equity markets extending the gains seen in April and delivering further positive returns across most major regions. Despite persistent geopolitical uncertainty and elevated energy prices, risk appetite remained. Tentative signs of progress toward a resolution of the Iran conflict provided a degree of cautious optimism, while continued enthusiasm for artificial intelligence, resilient corporate earnings, and improving sentiment across emerging and Asian markets collectively underpinned a broadly positive environment for risk assets, shares in particular.
Source: Bloomberg
Global equities delivered strong returns through May, with performance again concentrated in technology-led markets and those most exposed to the AI investment cycle. The Nasdaq 100 was a standout performer of the month, gaining 8.9% in euro terms – a remarkable result that reflects both the continued rotation into high-growth technology names and the broadening of the AI theme beyond the handful of mega-cap names that drove earlier gains. Investors increasingly looked past inflation fears, focusing instead on the structural earnings tailwinds being created by the accelerating deployment of AI infrastructure globally.
Asia and emerging markets were also among the strongest contributors to global equity returns, both gaining more than 10.0%. These regions continued to benefit from their central role in the global technology supply chain, with semiconductor manufacturers and hardware producers in Taiwan and South Korea again driving outsized returns. A stabilising US dollar provided an additional tailwind, improving the attractiveness of emerging market assets for international investors.
Japanese equities also performed well, with the MSCI Japan index gaining 5.3% in euro terms. Japan’s market continued to attract interest from global investors drawn to its improving corporate governance and improving earnings. This was tempered somewhat by rising rates and some volatility in Japanese government bonds and the yen.
In the US, the S&P 500 rose 5.6% in euro terms, a solid result. Earnings results continued to broadly exceed expectations, with the technology sector again leading. The labour market remained resilient, and consumer spending – supported by ongoing tax incentives – held up better than many had anticipated given the persistence of elevated fuel costs. The Federal Reserve maintained its current interest rate stance, though several committee members signalled a higher-for-longer bias, contributing to an increase in Treasury bond yields.
European equities posted more modest gains rising 3.4% in euro terms. While the region participated in the broader global risk-on move, weaker purchasing managers’ data and softening consumer confidence pointed to the ongoing economic drag from elevated energy costs. Inflationary pressures remained a concern and that continues to constrain the European Central Bank’s ability to consider rate cuts.
The UK was again the relative laggard, with the FTSE 100 closing the month down 0.1% in euro terms. The index’s high weighting in energy, financials, and defensive sectors served it well earlier in the year but meant it got left behind in May in a rally driven overwhelmingly by technology and growth stocks. UK inflation remained above target and the Bank of England adopted a more negative tone, suggesting that rate cuts are unlikely in the near term. The Euro strengthened modestly against Sterling as political uncertainty clouded the picture about economic growth.
Source: Bloomberg
Bond markets were mixed in May but overall broadly positive. European government bonds rebounded as the ECB suggested that rate increases would be very carefully considered and that there was a need to avoid premature action. Corporate bonds increased to reflect the over positive stance on risk.
Taken together, May’s moves across bond markets illustrate the central tension facing policymakers globally: the need to contain inflation on one hand, and the imperative to protect increasingly fragile growth on the other. This divergence is likely to remain a source of volatility within government bond markets in the months ahead and reinforces the importance of diversified and selective positioning within fixed income allocations.
The picture in the US was notably different. Resilient growth figures and rising inflationary pressures continued to keep the Federal Reserve in a more hawkish posture, with markets pricing in the possibility of further rate increases – a dynamic that weighed on Treasury valuations and left US government bonds as the weakest performer within the fixed income universe through the month.
Overall, as May drew to a close, markets found themselves navigating a familiar but increasingly complex set of crosscurrents. The AI investment theme remains a powerful force, capable of driving significant equity returns. Yet the persistence of above-target inflation across the US, UK, and eurozone has meaningfully reduced the likelihood of near-term rate cuts, instead supporting renewed uncertainty.
Energy prices remain a central variable. Oil continues to trade broadly between $90 and $110, underpinning inflation expectations and complicating the path for central banks, though any resolution to the Middle East conflict could shift this picture quickly.
Wide diversification and meaningful allocations to growth assets through a selective exposure to the structural growth themes reshaping the global economy remain the most effective tools available to investors navigating this environment.
At Fairstone, we specialise in providing tailored investment planning advice to help clients achieve their financial goals. Our experienced advisors offer personalised strategies designed to optimise growth, manage risks, and ensure diversification across a wide range of assets. By working with Fairstone, you can have confidence that your investment decisions are guided by expertise, adaptability, and a commitment to your long-term success.
Contact us today to book a no-obligation investment consultation and start planning for a secure financial future.
This publication was prepared by Bernard Walsh, Head of Investments & Pensions for Fairstone Asset Management DAC trading as Fairstone & askpaul.
This publication is for general information purposes and is not an invitation to deal or address your specific requirements. The information is believed to be reliable but is not guaranteed. Any expressions of opinions are subject to change without notice. This publication is not to be reproduced in whole or in part without prior permission. Articles should not be relied upon in their entirety and shall not be deemed to be, or constitute, advice. Although endeavours have been made to provide accurate and timely information of the various source material, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. We cannot accept responsibility for any loss due to acts or omissions taken in respect of the information contained within the articles. Thresholds, percentage rates and tax may be amended due to future legislative changes.
Information as of the date of publication 30/04/2026
The start of a new year tends to prompt reflection. June rarely does, but it should. By the time June arrives, the Irish tax year is exactly halfway through. Contribution windows are narrowing. Reliefs are going unclaimed. Investment positions set up at the start of the year have not been reviewed. And the 31 October deadline, which always feels distant in January, is suddenly much closer.
A mid-year financial review is not about overhauling everything. It is about a structured check across the areas that matter most, pension, tax, investments, protection, and estate, to ensure that nothing is being left on the table and that the second half of the year is working as hard as the first.
Pension contributions are one of the most tax-efficient financial moves available to working people in Ireland. Income tax relief at your marginal rate — up to 40% for higher earners — means that every €10,000 contributed effectively costs a higher-rate taxpayer €6,000. Growth within the fund is tax-free, with no exit tax or deemed disposal.
Mid-year is the right time to check three things. First, are you on track to use your full age-related contribution limit for 2026? Revenue caps relief at a percentage of earnings up to €115,000: 15% for those under 30, rising to 40% for those aged 60 and over. Second, if you received a bonus or other income earlier in the year, could an Additional Voluntary Contribution (AVC) absorb some of that before year-end? Third, the 31 October deadline allows you to backdate a contribution to the 2025 tax year, if you did not maximise your pension relief in 2025, you still have a window to fix that.
For anyone approaching or concerned about the Standard Fund Threshold — now €2.2 million in 2026, rising to €2.8 million by 2029 — a mid-year review of total fund value across all arrangements is particularly important. The phased increases create planning opportunities around timing of drawdown and contribution strategy that are worth working through with an advisor now rather than closer to retirement.
Read more in our guide to the Standard Fund Threshold in 2026
Revenue estimates that hundreds of millions of euro in tax credits go unclaimed by Irish taxpayers each year. PAYE employees, in particular, often assume that because tax is being deducted correctly through payroll, they have nothing further to do. That is rarely true.
A mid-year check through Revenue’s myAccount typically takes under an hour and can surface real money. Credits that are commonly overlooked include:
Markets have moved in the first half of 2026. A portfolio correctly positioned in January may look quite different by June, in both value and allocation. A mid-year review is not about reacting to short-term movements, but about ensuring the structure remains aligned to your timeline and objectives.
If you hold Irish-domiciled Exchange-Traded Funds (ETFs) or investment funds, the eight-year deemed disposal rule triggers a tax liability on unrealised gains automatically. June is a good time to check when each holding was originally purchased and whether any are approaching their eight-year anniversary in 2026 or 2027. Planning around this in advance is straightforward with the right structure.
Irish household deposits stand at over €170 billion, with inflation at 3.6% as of March 2026. If significant cash has accumulated since January, from a bonus, rental surplus, or retained profits, now is the time to revisit whether it should be working harder. Read more in our guide on what to do with a lump sum in Ireland in 2026.
Protection is the area most commonly overlooked in annual financial reviews, and yet the consequences of a gap tend to be the most severe. Mid-year is a good prompt to ask a few straightforward questions.
Has anything changed in the first half of 2026 that affects your cover requirements? A pay rise, a change of employer, a new mortgage, a growing business, or a change in family circumstances can all create a gap between the protection you have and the protection you need. In particular:
Read more in our guide to income protection in Ireland
The €3,000 annual gift exemption allows any individual to give €3,000 per year to any other individual, completely free of Capital Acquisitions Tax. It does not erode lifetime CAT thresholds. It is not transferable between years. And it resets on 1 January.
We are now halfway through 2026. For individuals with adult children, grandchildren, or others they intend to support, the mid-year point is a useful prompt to check whether this year’s exemption has been used. Two parents each gifting €3,000 to two adult children equals €12,000 moved outside the estate this year, entirely CAT-free, with no impact on any lifetime threshold. Over ten years, that is €120,000, compounding within the recipient’s own name rather than remaining in a potentially taxable estate.
Most people review their finances in January or, under pressure, in October ahead of the self-assessment deadline. A mid-year review in May or June is more useful for both. It is early enough to act on pension contributions for the current and prior year, correct tax credit gaps before year-end, and review investment positions without the distraction of an imminent deadline.
The most frequently unclaimed credits are the Rent Tax Credit (worth up to €1,000 per year, not applied automatically), medical expenses relief (20% on qualifying unreimbursed costs, claimable back four years), remote working relief, and the Mortgage Interest Relief available in its final year in 2026. All are claimable through Revenue’s myAccount.
Yes, if you act before 31 October 2026. Revenue allows pension contributions made before 31 October to be backdated to the prior tax year, meaning a contribution made now can attract relief for 2025 as well as 2026, potentially doubling the available headroom if you did not maximise your 2025 limit.
A formal review once or twice a year is generally sufficient for most long-term investors. The mid-year point is particularly useful for checking allocation drift, reviewing any approaching deemed disposal dates on fund holdings, and assessing whether any new capital, from a bonus or other source, should be deployed before year-end.
A mid-year financial review works best when it covers everything together, pension, tax, investments, protection and estate, rather than each area in isolation. The interaction between a pension top-up decision and your overall tax position for the year, for example, can only be properly assessed with a complete picture.
At Fairstone, our advisors are regulated by the Central Bank of Ireland and work across the full range of financial planning decisions. A mid-year review with the Fairstone team typically takes around an hour and gives you a clear, actionable picture of where you stand and what, if anything, to do before the year-end.
Sources
Revenue.ie — Pension contribution age-related limits
Revenue.ie — Tax credits and reliefs
Revenue.ie — Medical expenses relief
Revenue.ie — Mortgage Interest Relief 2026
Revenue.ie — CAT small gift exemption
Citizens Information — Rent Tax Credit
RTÉ Brainstorm — Tax credits and reliefs guide 2026
CSO — Consumer Price Index March 2026
Central Bank of Ireland — Household deposits data
Department of Finance — Budget 2026
Disclaimer
This article is for general information purposes and is not an invitation to deal or address your specific requirements. Any expressions of opinion are subject to change without notice. The information disclosed should not be relied upon in its entirety and shall not be deemed to be, or constitute, advice. Tax treatment depends on individual circumstances and may be subject to change. Although endeavours have been made to provide accurate and timely information of the various source material, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future.
Your ability to earn is the foundation of everything else in your financial life, your mortgage, your bills, your savings, your family’s security. Most people insure their car, their home, and their life. Far fewer insure the income that pays for all of it.
Income protection is one of the most overlooked forms of financial cover in Ireland. This guide explains what it is, how it works, what it costs after tax relief, and who needs it most.
Income protection insurance pays you a regular monthly income if you are unable to work due to illness or injury. Unlike life insurance, which pays on death, or serious illness cover, which pays a one-off lump sum, income protection replaces a portion of your salary for as long as you remain unable to work, right up to your chosen retirement age if necessary.
In Ireland, the maximum you can insure is 75% of your gross income, minus any State illness benefit you receive. Covered conditions are broad, physical illness, injury, and mental health conditions including depression, anxiety, and stress are all typically included. Many policies use an “own occupation” definition of disability, meaning you are covered if you cannot do your specific job. This is the most generous definition and the one to look for when comparing policies.
Income protection does not pay from day one of illness. There is a waiting period, the deferred period, before payments begin. Common options are 4, 8, 13, 26, or 52 weeks. The longer the deferred period, the lower your premium, because the insurer takes on less short-term risk. The practical approach is to match your deferred period to your existing cover: if your employer pays six months of sick pay, a 26-week deferred period means your income protection picks up exactly where that ends. If you have no employer sick pay, your deferred period should reflect how long your emergency fund would cover your essential outgoings before you need the policy to step in.
The benefit period is how long the policy pays if you remain unable to work. Longer policies pay until your chosen retirement age, typically 60, 65, or 68 — and up to age 70 with some providers. If you are out of work for years due to a serious illness, a five-year cap leaves you with nothing for the remainder of your working life. Policies running to retirement age cost more but provide genuinely comprehensive cover.
The benefit is paid monthly and is treated as taxable income, you pay income tax and USC on it, but not PRSI. Your insurer typically deducts tax before paying you. Because the benefit is taxable, the 75% gross income cap is designed to ensure you receive a reasonable net income while on claim without creating a financial incentive to stay off work.
Statutory Sick Pay gives employees five certified sick days per year at 70% of normal daily pay, capped at €110 per day. Beyond those five days, employees who qualify through their PRSI record can claim Illness Benefit, currently up to €254 per week at the maximum personal rate from January 2026, or roughly €1,100 per month before tax. Illness Benefit is also capped at two years.
To put that in context: someone earning €50,000 per year takes home around €3,100 per month after tax. On Illness Benefit alone, the gap to their normal income exceeds €2,000 every month. After two years, if they cannot return to work, there is no State income beyond means-tested benefits.
Self-employed people face an even starker position. Those paying Class S PRSI, the majority of sole traders, company directors, and partners, do not qualify for Illness Benefit at all. With approximately 340,000 self-employed people in Ireland, this is a very large group with no State income safety net if they cannot work.
Revenue-approved income protection policies qualify for income tax relief at your marginal rate, on premiums up to 10% of your total income in the tax year. For a standard-rate taxpayer, a €100 monthly premium costs €80 after relief. For a higher-rate taxpayer at 40%, that same premium costs €60. For a 40% taxpayer paying €150 per month, the effective cost after relief is just €90.
PAYE employees claim the relief through Revenue’s myAccount under ‘Permanent Health Insurance’. Self-employed individuals claim through their annual self-assessment return. For company directors, executive income protection, where the company pays the premium, can be more tax-efficient still: the premium is a deductible business expense for corporation tax, with no Benefit in Kind liability for the director.
Income protection is relevant to any working adult whose financial commitments would not be manageable without their income. Some groups face particularly high exposure:
The cheapest premium is not always the best value. Key things to check: the definition of disability (own occupation is preferable to any occupation); whether the benefit period runs to retirement age or is capped at a fixed number of years; whether premiums are guaranteed or reviewable (reviewable premiums can rise at the insurer’s discretion); and whether the policy includes indexation, an annual benefit increase to keep pace with earnings growth.
Full and accurate disclosure of your medical history at application is essential. Non-disclosure, even unintentional, can invalidate a claim, including for conditions that seem unrelated to the illness you are claiming for.
Income protection insurance covers your inability to work due to illness, injury, or mental health conditions. Most policies use an own occupation definition, meaning you can claim if you are unable to perform your specific job. Commonly covered conditions include back problems, cancer, heart disease, depression, and anxiety. However, it does not cover redundancy.
Policies typically insure up to 75% of your gross income, minus any State illness benefit received. The monthly benefit is taxable as income. Any employer sick pay or other income while unable to work is offset against the insured amount.
Yes. Premiums for Revenue-approved policies qualify for income tax relief at your marginal rate — 20% or 40% — on premiums up to 10% of your total income. The relief must be claimed actively through Revenue’s myAccount or your annual return.
Yes. Self-employed individuals can take out personal income protection and claim tax relief at their marginal rate. They do not qualify for Illness Benefit under Class S PRSI, making private cover particularly important. Company directors can structure cover through their company as executive income protection, making premiums a deductible business expense.
Choosing the right income protection policy involves more than finding the cheapest quote. The definition of disability, the deferred period, the benefit term, the insurer’s underwriting approach, and the interaction with existing employer cover all affect whether a policy will do what you need it to do if you ever have to claim.
At Fairstone, our advisors are regulated by the Central Bank of Ireland and work with clients across personal and executive income protection. We help identify the right level of cover, the appropriate policy structure, and the most tax-efficient way to hold it. If you are a business owner or company director, our article on how high earners in Ireland can legally reduce their tax bill in 2026 also covers executive income protection alongside other tax-efficient strategies.
Sources
Revenue.ie — Permanent Health Benefit contributions and tax relief
Citizens Information — Illness Benefit
Citizens Information — Sick leave and sick pay
Citizens Information — Class S PRSI
CCPC Ireland — Income protection insurance
Department of Social Protection — Illness Benefit 2026
Disclaimer
This article is for general information purposes and is not an invitation to deal or address your specific requirements. Any expressions of opinion are subject to change without notice. The information disclosed should not be relied upon in its entirety and shall not be deemed to be, or constitute, advice. Tax treatment depends on individual circumstances and may be subject to change. The information contained within the article and sources referred to are believed to be reliable and accurate as of the date of first publication but is not guaranteed to remain accurate into the future
April delivered broadly positive returns across risk assets, while fixed income markets experienced a more mixed environment as the ongoing tensions between the United States and Iran led investors to continually reassess the outlook for inflation and central bank policy. Reversing losses seen through March, equity markets benefited from resilient economic data and strong corporate earnings. Bond markets, however, exhibited a range of performance with corporate bonds delivering better returns as expectations of interest rate increases emerged.
Despite tensions between the US and Iran continuing to dominate headlines, and the Strait of Hormuz remaining severely disrupted, equity markets adopted a more positive outlook. Brent crude oil prices ended the month well above $100 per barrel, with ongoing ceasefire talks failing to result in a lasting agreement. Nevertheless, global equities delivered strong performance through the month, with continued economic resilience and positive momentum in technology-led sectors supporting renewed investor confidence rather than widespread risk aversion.
Source: Bloomberg
In the US, the S&P 500 rose approximately 8.7% in euro terms, extending the strong performance seen earlier in the year. Markets were buoyed by robust earnings reports, particularly within the technology and financial sectors, alongside continued optimism surrounding artificial intelligence and technology investment. Large-cap technology stocks again led performance, with the NASDAQ Composite rising 13.5% over the month.
Economic data in the US remained broadly positive with data suggesting the US labour market remained stable through the first quarter, although weaker household spending and geopolitical uncertainty may influence firms’ hiring intentions. That said, tax incentives have helped support consumer spending, offsetting some of the negative effects of higher fuel prices. One of the big drivers of returns has been corporate earnings with a substantial number of companies comfortably exceeding analyst expectations. Inflation data has yet to show any impact from the Middle East crisis.
European equities also posted gains, although performance was somewhat more modest increasing by roughly 5.1% in April. However, a slowdown in business activity across the region suggests that ongoing disruption in energy markets is beginning to feed through to the real economy, placing downward pressure on the region’s growth outlook. Europe’s energy reliance on the Middle East makes it more vulnerable than the oil self sufficient US economy.
The UK market lagged somewhat relative to its global peers, with the FTSE 100 returning approximately 3.1% in euro terms. The UK market’s heavier weighting towards energy, materials and defensive sectors limited participation in the global technology rally. Financials also experienced increased volatility as rising UK inflation created uncertainty around the future direction for interest rates of the Bank of England. Nevertheless, relatively attractive dividend yields and valuations continue to support investor interest.
In contrast, Asian and Emerging Market equities delivered particularly strong performance during the month. The MSCI Emerging Markets Index gained 12.7%. Both regions benefited from improving sentiment towards regional growth and renewed investor interest in global technology supply chains. Investor sentiment towards emerging markets was also supported by a softer US dollar and stabilising growth prospects in several key economies.
Overall, the global equity index rose 8.3% in April, highlighting the strength of the global relief rally.
Within bond markets, the picture was more mixed as investors reassessed the timing and scale of potential interest rate cuts from major central banks. Global bond returns were modestly positive overall, delivering a gain of roughly 0.1% with corporate bonds doing most of the “heavy lifting.”
Source: Bloomberg
Shifting expectations around monetary policy were the primary driver of volatility across government bond markets. US Treasuries declined by approximately 0.2% during the period, as stronger economic data and persistent inflation pressures pushed yields higher, suggesting rate cuts were less likely in the short-term.
Across Europe, government bonds fared slightly better, generating a modest return of around 0.3%, but risks remain due to ongoing wage pressures and persistent services inflation. In addition, inflation-linked bonds also recorded gains, reflecting continued demand for inflation protection
Overall, while fixed income returns were relatively muted compared with equities, the asset class continues to provide an important source of diversification and income. Yields remain significantly higher than those seen during the ultra-low interest rate environment of the past decade, improving the long-term outlook for bond investors. However, as uncertainty around inflation and interest rates persists, active asset allocation is becoming increasingly important to manage risk and ensure that fixed income continues to serve its role within diversified portfolios.
Looking ahead, markets will remain focused on inflation trends, central bank interest rate signals and the sustainability of corporate earnings growth. While volatility may persist as geopolitical developments lead investors to adjust expectations around interest rates, the broader economic backdrop remains relatively supportive. As always, diversification and adopting a long-term investment perspective remain central to navigating evolving market conditions.
At Fairstone, we specialise in providing tailored investment planning advice to help clients achieve their financial goals. Our experienced advisors offer personalised strategies designed to optimise growth, manage risks, and ensure diversification across a wide range of assets. By working with Fairstone, you can have confidence that your investment decisions are guided by expertise, adaptability, and a commitment to your long-term success.
Contact us today to book a no-obligation investment consultation and start planning for a secure financial future.
This publication was prepared by Bernard Walsh, Head of Investments & Pensions for Fairstone Asset Management DAC trading as Fairstone & askpaul.
This publication is for general information purposes and is not an invitation to deal or address your specific requirements. The information is believed to be reliable but is not guaranteed. Any expressions of opinions are subject to change without notice. This publication is not to be reproduced in whole or in part without prior permission. Articles should not be relied upon in their entirety and shall not be deemed to be, or constitute, advice. Although endeavours have been made to provide accurate and timely information of the various source material, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. We cannot accept responsibility for any loss due to acts or omissions taken in respect of the information contained within the articles. Thresholds, percentage rates and tax may be amended due to future legislative changes.
Information as of the date of publication 30/04/2026
Coming into a lump sum, whether through a bonus, redundancy, inheritance, or a property sale, is one of the most financially significant moments many people will experience. It is also a moment when the wrong decision is easy to make. The temptation to leave the money sitting in a current account is understandable, but Irish household deposits now stand at over €170 billion, much of it earning less than the 3.6% inflation rate. (Source: CSO) Cash sitting idle is not safe, it is quietly losing purchasing power.
This guide sets out a clear framework for deploying a lump sum in Ireland in 2026: the right sequence of decisions, the tax implications of each option, and what to avoid.
Before deploying any capital, confirm you have three to six months of essential outgoings in an accessible account. Without it, a short-term financial shock can force you to redeem long-term investments at the wrong moment.
Paying off debt at 8–20% delivers a guaranteed, tax-free return equivalent to that rate. No investment reliably outperforms that on a risk-adjusted basis. Clear any personal loans or credit card balances before thinking about investment.
How the money arrived affects what you owe before investing it. Statutory redundancy is always tax-free. An inheritance above your Capital Acquisition Tax (CAT) threshold (currently €400,000 from a parent) is taxable at 33%. A bonus is taxed as income under Pay As You Earn (PAYE). A property sale gain above €1,270 is subject to Capital Gains Tax (CGT) at 33%, unless it is your principal private residence. Knowing your starting position avoids unpleasant surprises after the fact.
Once the foundations are in place, the order in which you deploy capital matters significantly. The following sequence reflects Irish tax law in 2026 and prioritises the highest-returning, lowest-risk moves first.
If you have unused pension contribution capacity, topping up your pension with a lump sum is almost always the most tax-efficient move available in Ireland. Contributions attract income tax relief at your marginal rate — for a 40% taxpayer, a €10,000 contribution effectively costs €6,000 after Revenue returns €4,000 in relief. Growth inside the fund is tax-free, and there is no exit tax or deemed disposal.
Age-related limits set by Revenue cap how much qualifies for relief each year, based on a percentage of earnings up to €115,000: 15% for those under 30, rising to 40% for those aged 60 and over. You can also backdate a contribution to the previous tax year if made before 31 October, meaning a lump sum could attract relief across two tax years if timed correctly.
For money beyond your pension capacity, or which you may need access to before retirement, a managed investment fund is the next consideration. Irish-resident investors in managed funds pay exit tax at 38% on gains (reduced from 41% in Budget 2026), with the eight-year deemed disposal rule applying. This is a real tax cost, but still far better than cash losing value to inflation in a deposit account.
Whether to invest all at once or spread it over time is a common question. The evidence slightly favours investing a full lump sum immediately, as markets trend upward over time and time in the market tends to outperform timing it. For investors uncomfortable with volatility, a phased approach over six to twelve months is a reasonable compromise. Read more in our guide on where to invest your money in Ireland in 2026.
For the portion of a lump sum you want to keep genuinely safe for a specific goal, Ireland State Savings products (managed by the NTMA via An Post) offer government-guaranteed, tax-free returns with no fees or commissions. Returns are exempt from DIRT, income tax, USC, and PRSI. The 5-year Savings Certificate returns 9% total (AER 1.74%) and the 10-year National Solidarity Bond returns 22% total (AER 2.01%). Returns are modest, but their tax-free nature meaningfully improves the effective yield for higher-rate taxpayers.
For investors who want more direct market exposure, ETFs and individual shares are both accessible options. Irish-domiciled ETFs are subject to 38% exit tax with the eight-year deemed disposal rule. Direct shares attract CGT at 33%, payable only on actual disposal, with losses offsettable, making them more tax-efficient under the current regime despite the higher single-stock risk. For a full breakdown of the ETF tax picture, see our guide on investing in ETFs in Ireland in 2026.
The best use depends on your situation, but the general order is: secure an emergency fund, clear high-interest debt, maximise your pension contribution for the year, then invest the remainder in a diversified managed fund. If you want guaranteed, tax-free returns for a specific goal, State Savings products are worth considering for part of the money.
Yes. You can make a once-off Additional Voluntary Contribution (AVC) or special pension contribution at any time, subject to the age-related percentage limits on earnings up to €115,000. A 40% taxpayer contributing €10,000 receives €4,000 in tax relief. You can also backdate to the previous tax year if the contribution is made before 31 October.
Investing the full amount immediately has historically outperformed phased investing in most market conditions, because markets tend to rise over time. For investors uncomfortable with the idea of investing at a market peak, spreading over six to twelve months is a reasonable compromise that reduces timing anxiety without materially harming long-term returns.
It depends on the source. Statutory redundancy is fully tax-free. Inheritance above the relevant CAT threshold is taxed at 33%. A bonus is taxed as income. A property sale gain is subject to CGT at 33% above the €1,270 annual exemption, unless it is your principal private residence. Understanding the tax on the lump sum before deploying it is a critical first step.
A lump sum is one of the most significant financial moments in most people’s lives, and the decisions made in the weeks after receiving it tend to shape the direction for years. Getting the tax position right, maximising pension relief, and choosing the right investment structure are all areas where professional advice delivers lasting value.
At Fairstone, our advisors are regulated by the Central Bank of Ireland and work across the full range of investment and financial planning decisions. Whether your lump sum has just arrived or you have been sitting on cash for some time, a conversation with our team gives you a clear picture of your options. See our investment planning service.
For anyone questioning whether their existing savings are keeping pace with inflation, our article on whether your savings are losing value to inflation is a useful starting point.
Sources
Revenue.ie — Tax relief limits on pension contributions
Revenue.ie — Taxation of lump sum payments (redundancy)
Revenue.ie — Capital Acquisitions Tax thresholds
Revenue.ie — Capital Gains Tax
Citizens Information — Tax relief on pensions
Department of Finance — Budget 2026
Ireland State Savings (NTMA) — Products and rates
Central Bank of Ireland — Household deposits
Disclaimer
This article is for general information purposes and is not an invitation to deal or address your specific requirements. Any expressions of opinion are subject to change without notice. The information disclosed should not be relied upon in its entirety and shall not be deemed to be, or constitute, advice. Tax treatment depends on individual circumstances and may be subject to change. Encashment charges may apply in the event of early access to an investment being necessary. The information contained within the article and sources referred to are believed to be reliable and accurate as of the date of first publication but is not guaranteed to remain accurate into the future
Exchange-Traded Funds (ETFs) have become one of the most discussed investment vehicles in Ireland and for good reason. They offer low-cost, diversified exposure to global markets in a single trade. But for Irish investors, ETFs come with a layer of tax complexity that is genuinely unlike almost anywhere else in Europe. In 2026, that picture has shifted slightly for the better, with the exit tax rate reduced for the first time in over a decade. It has not been fully resolved and understanding the difference matters before you invest a single euro.
This guide covers what ETFs are, how they are taxed in 2026, the downsides that are often glossed over, what has changed, what has not, and how to approach them as part of a broader investment strategy.
An Exchange-Traded Fund is an investment fund that trades on a stock exchange in the same way a share does. Most ETFs track a specific index, such as the S&P 500, the MSCI World, or the EURO STOXX 50, meaning your money is automatically spread across hundreds or thousands of companies in a single investment. This delivers instant diversification at low cost, with annual management fees often well below 0.5%. Main types include equity ETFs (stock markets), bond ETFs (government or corporate debt), commodity ETFs (gold, oil), and sector-specific ETFs targeting technology, healthcare, or clean energy.
ETFs can also pay dividends to shareholders, distributing income generated by the underlying shares and bonds. This gives rise to two main share classes: distributing ETFs, which pay out dividends or coupons as cash to the investor, and accumulating ETFs, which reinvest that income back into the fund automatically. The vast majority of ETFs available to Irish investors are passive, designed to track an index rather than beat it. Actively managed ETFs do exist but remain far less common than their passive counterparts.
The tax treatment of ETFs in Ireland is materially different from most other investment types and more complex than many investors realise.
From 1 January 2026, exit tax on Irish and EU/EEA (European Economic Area) -domiciled ETFs reduced from 41% to 38%, the first reduction in over a decade, following a recommendation from the Department of Finance’s Funds Sector 2030 Review. On a gain of €50,000, the old rate cost €20,500; at 38% that becomes €19,000. The saving is real, if modest. What has not changed is how and when that tax is triggered.
Under the eight-year deemed disposal rule, Revenue treats your ETF as though you have sold it every eight years, even if you have done nothing. For example: you invest €40,000 in January 2020 and by January 2028 it has grown to €65,000. Revenue charges exit tax on the €25,000 gain, €9,500 at 38%, even though you have not sold a single unit. You may have to redeem part of your holding just to cover the bill, directly disrupting your compounding returns. A credit is applied when you eventually sell, so you are not double-taxed, but the timing disruption and administrative burden are real.
ETF investors in Ireland cannot offset losses against gains under the exit tax regime. If one ETF doubles and another halves, you still pay full exit tax on the gain. On share class: accumulating ETFs reinvest dividends within the fund, deferring any tax event until a chargeable event occurs. Distributing ETFs pay dividends as taxable income each year. Accumulating ETFs are the more tax-efficient and administratively straightforward choice for most long-term Irish investors.
Irish and EU/EEA-domiciled ETFs, with International Securities Identification Number (ISIN) codes beginning IE or LU, fall under the 38% exit tax regime with the deemed disposal rule. US-listed ETFs may instead be subject to Capital Gain Tax (CGT) at 33% with no deemed disposal, where Revenue determines they are not equivalent to Irish funds, but dividends are taxed at your marginal rate and reporting requirements are considerably more complex. The classification is fact-specific and getting it wrong carries penalties. Professional advice before investing in US-listed ETFs is strongly recommended.
ETFs are frequently promoted as the ideal investment for most people and often that is fair. But a balanced view requires acknowledging the limitations, particularly for Irish investors comparing ETFs with direct shares.
An investor buying individual shares pays CGT at 33%, only when they sell, only on actual gains, and with the ability to offset losses. An investor in a broadly equivalent Irish-domiciled ETF pays 38% exit tax, faces a forced tax event every eight years regardless of whether they have sold, and cannot offset losses. A concentrated bet on a single company stock is therefore taxed more favourably in Ireland than a diversified, low-cost ETF, a structural inconsistency the Funds Sector 2030 Review has acknowledged and recommended reforming.
ETFs track an index, meaning you buy whatever it contains, including its concentrations. You cannot exclude individual companies or adjust weightings, direct share ownership gives investors that control.
Buying ETFs directly also places the full weight of investment decision-making on the investor. Which ETF to buy, on which market, when to buy it, how it interacts with the rest of the portfolio, and whether better alternatives have emerged over time, these are not trivial questions. Most investors simply do not have the time, information, or experience to monitor and manage these decisions consistently. That is precisely where professional advice adds lasting value.
The Funds Sector 2030 Review recommended removing the eight-year deemed disposal rule, aligning exit tax with CGT at 33%, and introducing limited loss relief. The 2026 Budget confirmed a reform roadmap is in development and the 38% rate cut is described as a first step. The current rules apply in full until legislation changes. Planning should be based on what exists now, not what may eventually change.
A pension remains the most tax-efficient investment structure in Ireland. Contributions attract income tax relief at your marginal rate, up to 40% for higher earners, growth is tax-free within the fund, and there is no exit tax or deemed disposal. Maximising pension contributions before investing in a taxable ETF account is usually the right sequence.
For money outside a pension, lump sums, surplus savings, or medium-term goals, ETFs remain one of the most cost-effective options. See where to invest your money in Ireland in 2026 and our article on why staying calm is often your smartest investment move.
From 1 January 2026, exit tax on Irish and EU/EEA-domiciled ETFs is 38%, reduced from 41% under Budget 2026. It applies to gains on actual disposal and on the eight-year deemed disposal event. Pay Related Social Insurance (PRSI) and Universal Social Charge (USC) do not apply to ETF gains.
No. Direct shares are subject to CGT at 33%, payable only on actual disposal, with losses offsetable. Irish-domiciled ETFs are taxed at 38% exit tax with a forced deemed disposal every eight years and no loss offsetting. ETFs are taxed less favourably than direct shares under the current Irish regime.
Revenue treats an ETF as though it has been sold every eight years, triggering exit tax on unrealised gains even if you have not sold. A credit applies when you eventually sell, avoiding double taxation, but the forced event disrupts compounding and requires planning around each eight-year date.
For most Irish long-term investors, accumulating ETFs are more tax-efficient. They reinvest dividends within the fund, deferring any tax event until a chargeable event occurs. Distributing ETFs pay dividends as taxable income each year, adding an annual reporting obligation.
The Funds Sector 2030 Review recommended removing the deemed disposal rule, aligning exit tax with CGT at 33%, and introducing loss relief. A reform roadmap is in development. The 38% rate cut is the first step. Until legislation changes, current rules apply in full.
Ireland’s ETF tax rules are genuinely complex. The difference between an Irish-domiciled and a US-listed ETF determines whether you pay 38% exit tax with no loss relief or 33% CGT with the ability to offset losses. Choosing the right share class, tracking eight-year deemed disposal dates, and understanding how ETF holdings interact with your pension and tax position all require careful thought.
At Fairstone, our advisors are regulated by the Central Bank of Ireland and have extensive experience in Irish investment planning. We help clients make clear, informed decisions, whether investing for the first time or reviewing a portfolio that has grown more complex.
Book a no-obligation consultation with the Fairstone investment team.
Sources
Revenue.ie — Investment Undertakings and Exit Tax
Revenue.ie — Tax and Duty Manual Part 27-01A-03
Revenue.ie — Capital Gains Tax
Citizens Information — Capital Gains Tax
Department of Finance — Budget 2026
Department of Finance — Funds Sector 2030 Report
Oireachtas.ie — Minister’s statement on ETF reform, June 2025
Central Bank of Ireland — Investment Funds
Disclaimer
This article is for general information purposes and is not an invitation to deal or address your specific requirements. Any expressions of opinion are subject to change without notice. The information disclosed should not be relied upon in its entirety and shall not be deemed to be, or constitute, advice. Although endeavours have been made to provide accurate and timely information of the various source material, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. Tax treatment depends on individual circumstances and may be subject to change.
From 1 January 2026, the Standard Fund Threshold, the lifetime limit on the total value of tax-relieved pension benefits an individual can draw in Ireland, increased for the first time in over a decade. The SFT rose from €2 million to €2.2 million, the first step in a phased programme of increases that will bring it to €2.8 million by 2029.
For anyone with a large pension fund, approaching retirement, or contributing at a senior level in either the public or private sector, this is a significant development. This guide sets out exactly what has changed, who it affects, how the tax works, and what steps are worth taking in 2026.
The Standard Fund Threshold is the maximum capital value of pension benefits, across all pension arrangements combined, that an individual can draw in their lifetime without incurring an additional tax charge. It applies to occupational pension schemes, PRSAs, retirement annuity contracts, and personal retirement bonds. It does not apply to the State Pension.
When a person crystallises pension benefits, Revenue assesses the total capital value against the SFT. Any amount above the threshold is a “Chargeable Excess” subject to Chargeable Excess Tax (CET) at 40%, ringfenced, with no reliefs or deductions applicable. For defined benefit schemes, an age-related valuation factor is applied to the annual pension income to derive a capital value. For defined contribution funds, the market value is used directly. Once CET is paid, further Approved Retirement Fund (ARF) withdrawals are also taxed as income, meaning the effective combined rate on pension assets above the SFT can reach 70% or more.
The SFT stood at €2 million from 2014 until the end of 2025. It rose to €2.2 million on 1 January 2026, and will continue to increase by €200,000 per year through to 2029. From 2030 onwards, the government has committed to increasing the SFT annually in line with average earnings growth, using CSO data, to prevent it from eroding in real terms again.
Two aspects of the system remain unchanged from the pre-2026 position and are worth being clear about. First, the Chargeable Excess Tax rate stays at 40%. The independent De Buitléir review recommended reducing this to as low as 10%, but the government declined to act on this before 2030, when a specific review of the CET rate will take place.
Second, the maximum tax-efficient retirement lump sum remains capped at €500,000, and that cap is now decoupled from the SFT. Previously, the upper limit of the 20% tax band on lump sums was calculated as 25% of the SFT, meaning it would have risen automatically alongside future increases. That link has been severed. The lump sum treatment now works as follows: the first €200,000 is tax-free (lifetime limit), the next €300,000 is taxed at 20%, and any amount above €500,000 is taxed at the individual’s marginal rate. These bands are now fixed regardless of how high the SFT goes.
The SFT primarily affects high earners and long-serving professionals whose pension funds are large enough to approach or breach the limit. In practice this includes senior public sector employees — hospital consultants, principal officers, senior Gardaí — as well as senior private sector executives and business owners who have funded significant executive pensions.
The SFT had been frozen at €2 million since 2014 while Irish wages grew by approximately 33%. The practical effect was that growing numbers of professionals were hitting the limit before their intended retirement age, creating a perverse incentive to retire early or decline promotions rather than trigger a 40% charge on additional accrual. For those with total pension funds across all arrangements approaching €1.5 million or above, the 2026 changes and the phased increases through 2029 are worth understanding and planning around.
Consider a senior professional who crystallised a pension fund of €1,000,000 in 2024, using 50% of the then-current SFT of €2,000,000. In 2026, the SFT rose to €2,200,000. The percentage used stays fixed at 50%, but 50% of the higher threshold is €1,100,000, meaning the remaining headroom increased by €100,000 without any action. By 2029, when the SFT reaches €2,800,000, the same 50% usage leaves €1,400,000 of threshold, €400,000 more than at the end of 2025.
This proportional approach means individuals who have already drawn some benefits can still benefit from future increases on their remaining pension assets. For those who have not yet crystallised, the phased increases mean that waiting to draw benefits, up to 2029, directly increases available headroom. Every situation is different and the actual calculation requires detailed planning given the type of scheme, age, and applicable valuation factors.
For anyone whose pension fund is approaching the SFT, delaying crystallisation until the threshold is higher can meaningfully reduce or eliminate a CET liability. This applies to those in defined benefit schemes with flexibility in their retirement date, and to private sector individuals who can sequence drawdown of multiple arrangements across 2026 to 2029.
For individuals close to or above the SFT, further pension contributions may no longer be tax-efficient. Contributions that push the fund into Chargeable Excess territory will face 40% CET on drawdown, largely cancelling the income tax relief received on the way in. Redirecting to non-pension investments or, for business owners, corporate planning alternatives may be more appropriate, but this depends on individual circumstances and requires specific advice.
A Personal Fund Threshold (PFT) may apply where a pension fund was already above €2,000,000 on the relevant valuation date. This gives an individual a higher individual-specific limit rather than the standard SFT. PFTs are complex and fact-specific, if you believe one may apply to your situation, this is an area where regulated advice is essential.
The SFT is €2.2 million from 1 January 2026, up from €2 million where it had been fixed since 2014. It rises by €200,000 per year through 2029, reaching €2.8 million, and from 2030 increases annually in line with average earnings growth.
Any pension benefits above the SFT are subject to Chargeable Excess Tax at 40% on crystallisation, payable within three months, with no reliefs or deductions applicable. For defined contribution funds, further ARF withdrawals are also taxed as income, which can produce a combined effective rate of 70% or more on the excess.
No. The lump sum cap remains at €500,000 and is now decoupled from the SFT. The first €200,000 is tax-free (lifetime limit), the next €300,000 is taxed at 20%, and any amount above €500,000 is taxed at the marginal rate. These bands will not rise as the SFT increases.
Yes, partially. The percentage of the SFT you have used stays fixed, but the euro amount of remaining headroom increases as the threshold rises. If you used 50% of the SFT before 2026, you still have 50% of €2.2 million available, €1.1 million rather than €1 million, which can be useful if you have pension assets not yet crystallised.
Not yet. The De Buitléir report recommended reducing CET from 40% to as low as 10%, but the government has deferred this, committing only to a review before 2030. The 40% rate remains in force until further legislation.
The Standard Fund Threshold is one of the most technically complex areas of Irish pension planning. The interaction between the phased increases, existing vested benefits, defined benefit valuations, lump sum limits, and the timing of drawdown means that the right course of action is genuinely different from one individual to the next.
At Fairstone, our advisors are regulated by the Central Bank of Ireland and work with clients across the full spectrum of pension planning, from public sector professionals managing DB accrual against the SFT, to private sector executives and business owners structuring retirement benefits efficiently. Whether you are approaching the threshold, have already breached it, or want to understand how future increases affect your plan, we can help you work through the numbers and make decisions with confidence.
If pension contributions and tax relief are also a current question, our guide on how high earners in Ireland can legally reduce their tax bill in 2026 covers the broader picture.
Sources
Revenue.ie — Chargeable Excess Tax
Revenue.ie — Tax relief on pensions
Department of Finance — Minister Chambers announcement on SFT changes (September 2024)
Department of Finance — De Buitléir report on the Standard Fund Threshold
Department of Finance — Budget 2026
Citizens Information — Occupational pensions and retirement
Disclaimer
This article is for general information purposes and is not an invitation to deal or address your specific requirements. Any expressions of opinion are subject to change without notice. The information disclosed should not be relied upon in its entirety and shall not be deemed to be, or constitute, advice. Tax treatment depends on individual circumstances and may be subject to change.The information contained within the article and sources referred to are believed to be reliable and accurate as of the date of first publication but is not guaranteed to remain accurate into the future.
It is one of the most common questions Irish mortgage holders ask. And in 2026, the answer is more nuanced than it has been in some time.
Fixed rates in Ireland are currently lower than variable rates, the reverse of the historical norm. With rate competition continuing to reshape the market, the case for reviewing your current rate, whatever it is, has rarely been stronger.
With over 20 mortgage rate changes in the Irish market over the past year, the case for reviewing your current rate, whatever it is, has rarely been stronger.
Over 80% of new mortgages taken out in Ireland are now on fixed rates. This is a significant shift from several years ago, when around 80% were on variable rates.
As of April 2026, the Irish mortgage market offers genuine choice across fixed and variable products. Here is a snapshot of the current landscape:
If knowing exactly what your repayment will be each month matters to you, a fixed rate removes that uncertainty entirely for the duration of the fixed term. For households managing childcare, school fees, or other significant fixed outgoings, this predictability has real value.
With fixed rates currently lower than most variable rates in Ireland, a reversal of the historical norm, fixing now locks in a competitive rate without accepting a premium for certainty.
Rate certainty has rarely been more accessible. While rates have been stable in recent months, there is no guarantee they will remain so and a fixed term of three to five years insulates you completely from any movements during that period.
A 3–5 year fixed term is currently the most popular choice among Irish borrowers, giving most households a meaningful planning horizon without committing to an excessively long lock-in.
Variable and flex products offer greater flexibility, particularly for borrowers who anticipate a lump sum, an inheritance, or a salary jump that they want to use to reduce the mortgage balance ahead of schedule.
Avant Money’s Flex Mortgage, for example, allows overpayment at any time with no charge. If you are likely to make substantial overpayments within the next two to three years, breakage costs on a fixed rate could offset any rate saving.
Variable rates are tied to market conditions. If ECB rates fall further, not currently expected in the near term, but not ruled out, a variable rate borrower benefits directly. Lenders typically pass rate decreases and increases onto customers in line with ECB rate changes. A fixed borrower does not benefit until their fixed term expires.
Green mortgages offer discounted rates for homes with a strong Building Energy Rating (BER). Multiple lenders, including Haven, PTSB, and EBS, now offer lower fixed rates for properties rated A or B.
Bank of Ireland takes a different approach with its EcoSaver fixed rate, which applies tiered discounts to all BER-rated homes, from A right down to G, with the discount increasing the more energy-efficient the property. A BER A-rated home qualifies for the maximum discount, while even a G-rated property receives a small reduction on the standard fixed rate.
If your home has been recently upgraded, renovated, or is newly built, it is worth checking your BER certificate. A higher rating can unlock a meaningfully lower interest rate, and the energy savings reduce your running costs at the same time.
Bank of Ireland’s EcoSaver fixed rates start from 3.1% and are available to first-time buyers, second-time buyers, and switchers. The rate you receive will depend on your LTV (Loan to Value) and the BER of the property and if you improve your BER after drawing down, your rate can reduce again.
Yes, particularly if your current rate was set in 2022 or 2023, when rates were rising sharply. The Irish market has moved significantly since then, and switching to a more competitive product could reduce monthly repayments materially.
A mortgage review is not the same as remortgaging. It starts with understanding what rate you are currently on, what products are available to you now, and whether the savings justify any switching costs. Our mortgage advice service covers the full process from initial review through to drawdown.
Always compare the APRC (Annual Percentage Rate of Charge), not just the headline rate. The APRC reflects the true cost of the mortgage including fees and the rate you revert to when a fixed term ends.
For most borrowers who value certainty, yes. Fixed rates are currently lower than most variable rates, which is unusual by historical standards, and ECB rate stability means the window to lock in a competitive rate at a lower-than-variable price is open. That said, your personal circumstances (overpayment plans, likely moving timeline, lump sums expected) should always be factored in.
As of April 2026, the lowest fixed rate available is 3.0% on a 4-year term from PTSB, subject to loan-to-value and eligibility criteria. Green mortgage products from Haven, Bank of Ireland, and PTSB offer lower rates for homes with a BER rating of A or B. Rates are subject to change. Speak to a Fairstone mortgage adviser first to find out which products you qualify for and which represents the best value for your circumstances.
At the end of your fixed term, your mortgage typically reverts to the lender’s standard variable rate unless you actively choose a new fixed rate. This is a critical moment, many borrowers pay more than necessary by simply rolling onto the variable rate without reviewing. Note your expiry date and get in touch with a Fairstone adviser 6 to 12 months in advance so you have time to review all available options before your term ends.
Yes. Mortgage switching in Ireland is well-established and can yield significant savings, particularly for borrowers whose LTV has improved since they first took out their mortgage. A lender who offered you 3.7% in 2022 may no longer be the most competitive option. Many lenders offer attractive cashback incentives for switcher applications, and in most cases these cashback offers cover switching costs and more. For a full breakdown of the switching process, costs, and timeline, read our guide to switching mortgages in Ireland.
What is the difference between a fixed rate and an APRC?
The fixed rate is the interest rate applied during the fixed term. The APRC (Annual Percentage Rate of Charge) is the total annualised cost of the mortgage including fees, valuation costs, and the rate that applies after the fixed term ends. A lower headline rate can carry a higher APRC if the reversion rate is unfavourable. Always compare APRCs when choosing between products.
The Irish mortgage market in 2026 offers more choice than at any point in the past decade, different fixed terms, green discounts, High Value rates, flex products, and cashback offers. Navigating it without independent advice means relying on a single lender’s perspective.
At Fairstone, our mortgage advisers review the full market on your behalf. We assess your current rate, your loan-to-value position, your overpayment intentions, and your timeline, and identify the product that is genuinely best suited to your circumstances, not the one a single lender happens to offer.
Whether you are a first-time buyer, approaching the end of a fixed term, or on a rate you have not reviewed in years, the conversation is straightforward and the potential saving is real.
Ready to review your mortgage?
Sources
Avant Money — Mortgage Products & Rates (March 2026)
PTSB — Mortgage Interest Rates (Green Mortgage BER criteria)
Bank of Ireland — Mortgage Interest Rates
Information as of 21 April, 2026
Disclaimer
This article is for general information purposes and is not an invitation to deal or address your specific requirements. Any expressions of opinions are subject to change without notice. The information disclosed should not be relied upon in their entirety and shall not be deemed to be, or constitute, advice. Although endeavours have been made to provide accurate and timely information of the various source material, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future.
Market uncertainty has become the permanent backdrop for Irish investors in 2026. Geopolitical tensions, shifting trade relationships and a cautious European Central Bank (ECB) have left many people wondering whether now is the right time to act.
But here is the reality: uncertainty is not new, it has accompanied every market cycle in living memory. And the data consistently shows that waiting for calmer conditions costs more than staying invested.
Over €171 billion sits in Irish household deposits as of early 2026, much of it earning less than the current 2.5% HICP inflation rate. The cost of inaction is real, even if it is quiet.
A few facts frame the starting point for Irish investors this year:
What this adds up to: Irish households save well, but much of that capital is not keeping pace with inflation. In 2026, that distinction matters more than it has in some time.
The instinct to hold cash when markets are volatile feels prudent. The evidence says otherwise.
Investors who shifted to cash whenever the CBOE VIX (a measure of market volatility) rose above its historical average, and only moved back when calm returned, would have reduced their returns since 1990 by nearly 80% compared to those who stayed invested.
Over a 10-year period, equities have beaten inflation approximately 87% of the time. Over 20 years, that figure is effectively 100% across all rolling periods, compared to just 64% for cash.
Market recoveries are often swift and concentrated in a small number of trading days. Missing those days, which tend to come at moments of maximum uncertainty, locks in losses and forfeits the gains that historically follow.
If you are weighing up whether to act or hold back, our guide on staying calm in volatile markets is worth reading first.
For most Irish investors, a diversified fund, accessed through a pension, investment bond or direct platform, remains the most practical route to long-term wealth. These spread exposure across equities, bonds, property and alternatives, reducing the impact of any single market event.
The key principle: choose a fund aligned to your risk profile and give it time to perform. Switching in response to short-term volatility is one of the most reliably damaging decisions an investor can make.
For investors newer to fixed income, our overview of bonds in Ireland explains how government and corporate bonds can support a balanced long-term portfolio.
If you are not maximising pension contributions in 2026, you are leaving one of the most significant financial advantages in the Irish tax system unused.
Contributions attract income tax relief at your marginal rate. For a 40% taxpayer, every €100 contributed costs just €60 after relief.
Age-related limits allow up to 40% of earnings from age 60, on earnings up to €115,000.
Ireland has also implemented auto-enrolment in 2026, calculated on the first €80,000 of salary. This does not replace the need for a personal pension strategy, particularly for higher earners or the self-employed.
For those looking to go further, Additional Voluntary Contributions (AVCs) offer a tax-efficient way to top up what your main pension scheme provides.
In 31 out of the last 54 calendar years, global equities dropped 10% or more at some point during the year. Yet across those same five decades, the direction of travel has consistently been upward.
For long-term investors, equity exposure through managed funds or Exchange Traded Funds (ETFs) has historically been the most reliable way to outpace both inflation and cash.
Irish investors should note that fund returns are subject to exit tax at 38% (reduced from 41% in Budget 2026), with deemed disposal applying every eight years, making how you hold equity investments a significant consideration.
The Government has indicated that a new Personal Investment Account is under development. The aim is to legislate for the framework in 2026, with accounts expected to be available from 2027. The 2026 Annual Savings and Investment Forum, convened by the Department of Finance in March 2026, is focused on advancing this framework, aligned with the European Commission’s recommendation to develop accessible, consumer-friendly savings and investment accounts.
Further work on a retail investment tax roadmap is ongoing and is expected to be published in the coming months, setting out an approach to simplify and adapt the tax framework for retail investment. The full details of the scheme, including contribution limits and tax treatment, have not yet been confirmed.
In the meantime, the existing rules, exit tax at 38%, deemed disposal every eight years, continue to apply to investment decisions made today.
Property remains part of many Irish wealth strategies. Residential prices rose 7.3% in the 12 months to October 2025, according to the CSO, and demand continues to outpace supply in most markets.
However, buy-to-let considerations have shifted in 2026. Bank of Ireland is now restricting lending on Building Energy Rating (BER) F and G rated properties, energy efficiency has become a lending criterion, not just a running cost.
Property works best as part of a diversified strategy. Rental income is taxable, liquidity is limited, and leverage carries its own risks.
A reserve of three to six months’ accessible income is sound financial practice. Beyond that, cash in 2026 is losing real purchasing power at 2.5% inflation.
The question is not whether to hold some cash, it is whether the amount you are holding is appropriate to your overall picture.
A few principles that hold regardless of market conditions:
For long-term investors, the evidence consistently favours staying invested over waiting for ideal conditions. Markets recover, often quickly, and the most significant gains frequently come immediately after periods of maximum uncertainty. Structure and time horizon matter more than entry point.
A widely used starting point is three to six months of living expenses in accessible cash. Beyond that, money held in low-yield deposits in 2026 carries a real inflation cost. The right proportion depends on your income stability, goals, and timeline.
Maximising pension contributions is the single most tax-efficient investment decision available. Contributions attract relief at your marginal rate (up to 40%), growth is tax-free within the pension, and up to 25% of the fund can be taken as a tax-free lump sum at retirement.
At 2.5% inflation in early 2026, €100,000 in a deposit earning less than that rate loses purchasing power every year. Over 10 years, the effect is material. Equities and diversified funds have historically beaten inflation around 87% of the time over 10-year periods.
Three steps: build a 3–6 month cash reserve first, maximise pension contributions to capture tax relief, then invest in a diversified fund aligned to your risk tolerance and timeline. Start early, invest regularly, and resist reacting to short-term market noise.
The Irish investment landscape in 2026 is more complex than headlines suggest. Exit tax, deemed disposal, pension contribution limits, the interaction of salary and investment structures, these are areas where a well-built financial plan consistently outperforms ad hoc decisions.
At Fairstone, our investment advice is built on evidence, not instinct. We are a Central Bank of Ireland regulated wealth management firm with over 25 years of experience in the Irish market, and a team of Qualified Financial Advisors (QFA) who build long-term plans around what matters: your goals, your timeline, and your financial future.
Whether you are reviewing an existing portfolio, starting out for the first time, or approaching retirement, a clear, personalised conversation is where it starts.
Sources
CSO — Household Saving Q4 2025
Raisin — What’s Next for Irish Interest Rates (March 2026)
JP Morgan — Guide to the Markets (EMEA 2026)
Bank of Ireland — Mortgage Interest Rates (BTL BER restriction)
This blog is for general information purposes and is not an invitation to deal or address your specific requirements. Any expressions of opinions are subject to change without notice. The information disclosed should not be relied upon in their entirety and shall not be deemed to be, or constitute, advice. Although endeavours have been made to provide accurate and timely information of the various source material, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future.
If you earn a high income in Ireland, you are almost certainly paying more tax than you need to. Not through any fault of your own, but because the full range of legitimate reliefs available to higher earners is rarely used in full.
A single person earning over €100,000 faces a combined marginal rate of around 52%, income tax at 40%, USC at up to 8% (plus a 3% self-employed surcharge above €100,000), and PRSI at 4.2%.
Paying tax is unavoidable. Overpaying is not. This guide covers the most effective, Revenue-approved strategies available to high earners in Ireland in 2026.
The most significant tax savings for high earners in Ireland are not found in complex schemes. They are found in the straightforward reliefs most people are fully entitled to, but have never claimed in full.
Pension contributions are the most powerful tax reduction tool available to higher earners in Ireland. Contributions attract income tax relief at your marginal rate, every €100 contributed by a 40% taxpayer costs just €60 after relief.
Age-related limits allow contributions from 15% of earnings (under 30) up to 40% of earnings from age 60, on a salary cap of €115,000.
Pension contributions also reduce gross income for USC purposes, adding a further saving for those in the 8% USC band.
In 2026, the Standard Fund Threshold (lifetime limit on tax-relieved pension funds) increased to €2.2 million, with phased increases planned through 2029.
Example: A 50-year-old director earning €115,000 can contribute up to 30%, €34,500, with full income tax relief. At 40%, that is €13,800 returned by Revenue before a single investment return is earned.
For company owners and directors, how income is extracted matters as much as how much is earned.
The right balance requires a full review. What worked at €80,000 is often not optimal at €150,000.
From 1 January 2026, the Revised Entrepreneur Relief lifetime limit increased from €1 million to €1.5 million, with CGT (Capital Gains Tax) at just 10%, a potential saving of €345,000 versus the standard 33% rate.
Every individual also has a €1,270 annual CGT exemption. Married couples can each use this on jointly held assets.
For business owners approaching a sale or exit, the interaction between Entrepreneur Relief, Retirement Relief (age 55+), and pre-sale pension funding can be highly significant. Planning should begin well before heads of terms are agreed.
The EIIS allows qualifying individuals to claim income tax relief of 20% to 50% on investments in qualifying Irish SMEs, on up to €1 million per year.
For a 40% taxpayer, a €50,000 investment qualifying for 35% relief generates a €17,500 reduction in income tax in the year of investment. Capital must be held for a minimum of four years and is at risk.
Important: The EIIS scheme is currently scheduled to end on 31 December 2026 unless extended. Anyone considering EIIS relief for the 2026 tax year should note the December deadline.
Married couples with two earners can extend the standard rate band up to €88,000, €53,000 for the higher earner and up to €35,000 for the second earner, before the 40% rate applies.
Reviewing joint versus separate assessment, income splitting through salary or dividends where roles allow, and maximising each partner’s pension contributions independently can yield a material combined saving.
Tax credits reduce your bill directly. Many are applied automatically; others require active claiming through myAccount or ROS.
Employer pension contributions are typically the most efficient method. They attract no income tax, PRSI, or USC for the director, are deductible at 12.5% corporation tax for the company, and grow tax-free within the pension. A modest salary (for pension eligibility and PRSI entitlements) combined with employer pension contributions is the most common structure for owner-directors.
The maximum tax-relieved contribution is an age-related percentage of earnings up to €115,000, ranging from 15% (under 30) to 40% (age 60+). Employer contributions operate separately and do not count toward this personal limit. The Standard Fund Threshold increased to €2.2 million from January 2026.
USC applies to gross income with very limited reliefs. However, employer pension contributions made under a salary sacrifice arrangement reduce the gross income on which USC is calculated, one of several reasons employer contributions are more efficient than personal contributions for company directors.
Revised Entrepreneur Relief reduces CGT from 33% to 10% on qualifying gains from the sale of a business. From 1 January 2026, the lifetime limit increased from €1 million to €1.5 million, a potential saving of up to €345,000. Qualifying conditions apply, and early planning is essential.
You can claim missed pension tax relief for up to four prior tax years. The deadline for PAYE workers and the self-assessed is 31 October of the following year. This is particularly relevant for higher earners who recently moved into the 40% band and were not previously maximising contributions.
The Irish tax code for high earners involves the interaction of income tax, USC, PRSI, CGT, CAT, and corporation tax, alongside pension limits, the Standard Fund Threshold, director pension rules, and investment structures. Decisions made without an integrated view regularly cost more than the advice would have.
At Fairstone, we work with professionals, directors and business owners across Ireland who want to take control of their tax position, not just at year end, but as part of a coherent, long-term financial strategy.
Our advisers are Qualified Financial advisors (QFA), regulated by the Central Bank of Ireland, with over 25 years of experience in the Irish market. We build a complete picture of your income, assets, pension position and goals, and identify precisely where reliefs are available and how to claim them.
Sources
Revenue – Income Tax Bands & USC Rates
Revenue – Pension Tax Relief Ireland
Revenue – Entrepreneur Relief in Ireland
PwC Tax Summaries — Ireland Individual Deductions
Raisin — Capital Gains Tax Ireland 2026
Revenue – EIIS Investments — EIIS Relief Rates
Grant Thornton — Budget 2026 (Entrepreneur Relief)
Information as of 08.04.26
This article does not constitute tax or legal advice and should not be relied upon as such. Tax treatment depends on the individual circumstances of each client and may be subject to change in the future. For guidance, seek professional, independent, advice. This article is for general information purposes and is not an invitation to deal or address your specific requirements. Any expressions of opinions are subject to change without notice. The information disclosed should not be relied upon in their entirety and shall not be deemed to be, or constitute, advice. Although endeavours have been made to provide accurate and timely information of the various source material, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future.
