Budget 2026 has been unveiled, marking a shift from short-term cost-of-living supports toward longer-term, structural measures designed to build a fairer and more resilient economy. This year’s €9.4 billion package focuses on steady increases to welfare and pensions, moderate tax adjustments to protect middle-income earners, and targeted incentives for businesses and innovation.
The Government has described this as a “responsible” budget, one that balances ongoing support for households with fiscal discipline as global growth slows. There are no one-off energy credits or emergency payments this time, but instead, permanent improvements in income supports, tax thresholds, and sectoral incentives.
In this article, we break down the main announcements from Budget 2026 and what they mean for individuals, families, and businesses across Ireland.
One of the most headline-grabbing announcements is the increase in the National Minimum Wage from €13.50 to €14.15 per hour, effective 1 January 2026. This 65-cent rise reflects the Low Pay Commission’s recommendation and continues the Government’s multi-year effort to move closer to a “living wage.”
To prevent this increase from pushing minimum-wage workers into higher Universal Social Charge (USC) liabilities, the 2 % USC band has been extended to €28,700. This means those earning the new minimum wage full-time will remain in the lower USC bracket and avoid a stealth tax increase.
At the same time, the Government announced a €10 weekly rise in all core social welfare and pension payments, benefiting more than 1.5 million people. These include the State Pension, Jobseeker’s Allowance, Carer’s Allowance and Disability Allowance.
What it means:
For workers on low or modest wages, these combined changes ensure that the minimum-wage uplift is not eroded by higher tax deductions. Pensioners and welfare recipients see steady, structural gains instead of short-term bonuses.
What it means:
Families with school-age children gain meaningful recurring relief rather than sporadic lump-sum supports. Expanding eligibility for the Working Family Payment and Fuel Allowance should help offset energy and childcare costs through the winter months.
Click the following link to read more about Saving for Education in Ireland
What it means:
While renters and mortgage holders see some continued relief, the Government’s emphasis has shifted toward supply-side measures, using tax incentives to make building and renovating homes more attractive. The new derelict property tax signals stronger policy action to bring idle properties back into use.
Click the following link to read more about What is the Help to Buy Scheme (HTB)
There are no sweeping income-tax cuts for 2026. Instead, the Government prioritised smaller, targeted changes designed to maintain fairness and prevent bracket creep:
A key feature of Budget 2026 is the reduction in the tax rate on investment returns, a move welcomed by savers and long-term investors. The tax on investment funds and life assurance savings products, commonly known as the exit tax, will fall from 41% to 38% from January 2026.
This marks the first reduction in over a decade and is designed to encourage personal saving and make domestic investment products more attractive compared to direct shareholdings, which are taxed under Capital Gains Tax rules.
The Government stated that this change reflects its goal of supporting financial resilience and rewarding long-term saving among households, while also aligning Ireland more closely with European norms for investment taxation.
What it means:
Together with the higher Entrepreneur Relief threshold and improved R&D tax credits, this change signals a clear pro-investment stance from the Government, intended to promote savings, innovation, and long-term capital formation.
What it means:
The overall tax direction is neutral, the Government’s focus is on preventing tax drag and supporting job-rich sectors, not cutting rates wholesale. Businesses in hospitality, energy and R&D stand to benefit most from targeted VAT and credit adjustments.
What it means:
These moves demonstrate Ireland’s ongoing commitment to innovation-led growth. SMEs benefit from greater liquidity through higher R&D refunds, while start-ups and scaling founders gain improved exit flexibility. Multinationals are also reassured by the continuation of SARP, reinforcing Ireland’s status as a competitive base for global talent.
The Department of Health budget increases to €27.3 billion, supporting new frontline staff recruitment, expanded disability services, and improvements in community and mental health care. Funding also targets waiting-list reduction and emergency-department capacity.
Education continues to receive strong prioritisation, with measures including:
What it means:
Investments in these core areas represent the Government’s strategy of long-term resilience building, more teachers, more hospital capacity, and more affordability for students rather than short-term financial relief.
In parallel with social and fiscal measures, the Budget reinforced Ireland’s climate commitments:
What it means:
Sustainability and regional development continue to underpin fiscal planning. Businesses in the green economy and construction sectors will find opportunities in energy efficiency and public works projects, while regional communities gain from infrastructure investment.
Budget 2026 will likely be remembered less for dramatic giveaways and more for measured, structural reforms that seek to balance social fairness with economic prudence. The focus on permanent welfare increases, childcare supports, sectoral VAT relief, and innovation incentives signals a government moving toward steady, predictable policymaking after several years of crisis-driven budgets.
For most households, it brings small but reliable improvements to disposable income. For businesses, especially in hospitality and technology, it offers practical tools to stabilise costs and invest for growth. For the broader economy, it reinforces a message of stability, prudent spending paired with targeted incentives.
At Fairstone, we can help you translate these announcements into practical steps: from adjusting payroll systems and business forecasts to personal tax planning and investment strategy. Contact us today to understand how Budget 2026’s measures can work for your goals, and to plan confidently for the year ahead.
Sources:
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Information as of 07/10/2025
Disclaimer:
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. This article is for general information purposes and is not an invitation to deal or address your specific requirements. The information disclosed should not be relied upon in their entirety. 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.
Sending a child to college is one of the biggest financial commitments many parents in Ireland will face. Between the annual student contribution fee, rising rents, and general living costs, the total bill for a four-year degree can easily run into tens of thousands of euro. Saving for Education in Ireland for families with more than one child, these figures multiply quickly, making education planning an essential part of family financial planning.
In this guide, we break down the true cost of higher education in Ireland, when parents should start saving, the best ways to put money aside, and the tax and charges to be aware of. Whether your child is in preschool, secondary school, or already preparing for university, starting early and planning wisely can help you manage this significant expense.
How much you’ll spend depends on whether your child studies from home or moves out to attend university.
According to the most recent Irish Times and TU Dublin Cost of Living Guide:
For postgraduate study, costs are higher again. Many Master’s programmes range from €9,000 to €35,000 per year, excluding living expenses, books, laptops, and additional course fees.
And for families who choose private secondary schools before university, costs increase further. Some fee-charging schools cost €9,000 annually for day pupils, and boarding can reach €24,500 per year, before adding grinds, extracurriculars, and trips.
It’s clear that education is one of the largest long-term costs a family will face, but unlike other expenses, you know the timeline from day one, which makes planning possible.
Education is predictable. You know your child will likely begin college at 18, so you have nearly two decades to prepare. The earlier you start saving for education in Ireland, the easier it will be to spread the cost and benefit from compounding growth.
Take the Child Benefit payment of €140 per month. If you set it aside every month until your child turns 18, you’d save €30,240. If invested with an average annual return of 5%, this could grow to nearly €48,500, enough to cover most undergraduate costs for a child living at home, or a significant portion if they live away.
Delaying until secondary school is still worthwhile but reduces your time horizon. In that case, your options may lean more towards deposit savings or larger monthly contributions to catch up.
Starting early also means you can explore a wider range of saving and investment strategies, tailored to your risk profile and timeline.
Deposit and fixed-term savings accounts are low-risk and simple to manage. However, interest rates are generally low, and inflation can erode the value of money over time. For example, according to The Irish Times:
These are best for short-term savings, particularly if your child is close to college age.
For longer-term goals (five years or more), investment funds can help your money grow faster than inflation.
For example, if you contribute €250 per month for 18 years with a gross annual return of 6% (before fees or taxes), you could build a fund worth about €76,072. By comparison, the same contributions without investment growth would amount to €54,000.
Many providers offer education-focused investment products (regular savings plans or lump-sum investment funds offered by Irish life insurers and investment providers). Minimum contributions typically start at €125/month or €20,000 lump sums.
While investing carries risk, markets have historically outperformed cash savings over the long term, making this a suitable option if you start early.
Redirecting Child Benefit directly into a savings or investment plan is one of the simplest and most effective ways to fund education costs. It’s regular, untaxed income from the government, and aligns perfectly with the 18-year timeframe before third-level education.
Parents and grandparents can each give up to €3,000 per year per child tax-free (€6,000 per couple). Over time, and if invested, these contributions can make a substantial impact on education savings.
Click the following link to read more about Small Gift Exemption
If you choose investment-based savings, be aware of the associated costs:
When comparing providers, always check the allocation rate (the percentage of your contribution actually invested) and factor in charges, as they can significantly affect your final return.
Not every parent has the chance to save for 18 years. If your child is already in college, there are still ways to manage costs:
Small, consistent steps can add up to big results when spread across 10–18 years.
Education is one of the few major expenses you can plan for decades in advance. But with multiple saving options, tax rules, and investment products, making the right choice can be complex.
A financial adviser can help you:
At Fairstone, we offer expert financial planning tailored to your circumstances. Whether you are just starting to save for a newborn, planning for private secondary school, or already funding a college student, we can help you put a clear, tax-efficient strategy in place. With our support, you can fund your child’s education with confidence while protecting your long-term financial wellbeing.
Sources:
Revenue.ie
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This publication 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’ve recently sold a property, gifted an asset, or made a profitable investment, you may be wondering: What is Capital Gains Tax? In Ireland, Capital Gains Tax (CGT) applies when you dispose of an asset and make a profit or “gain” from that transaction. Disposing of an asset doesn’t only mean selling it, it can also include gifting, exchanging, or receiving insurance or compensation for it. Understanding how much is capital gains tax in Ireland, how to calculate it, and how to pay Capital Gains Tax in Ireland is essential to avoid unexpected tax bills.
This article explains what is Capital Gains Tax Ireland, who must pay it, what exemptions apply (including the 7-year Capital Gains Tax exemption), and the importance of seeking professional advice.
Capital Gains Tax (CGT) is a tax you pay on the profit you make when disposing of an asset. The chargeable gain is the difference between the amount you received and the amount you originally paid for the asset, minus any allowable expenses (like solicitor fees or improvement costs).
You may be liable for CGT when you:
CGT is not charged on the entire sale amount—only on the profit made, after deducting allowable costs.
The standard Capital Gains Tax rate in Ireland is 33%. However, there are exceptions:
These rates apply to the taxable gain after you’ve deducted any exemptions, reliefs, or allowable expenses.
Any individual (resident or non-resident), trust, or company who makes a chargeable gain must pay CGT. If you jointly own an asset, each person pays CGT on their share of the gain.
Non-resident individuals are only liable for CGT on:
There are several Capital Gains Tax Ireland exemptions. Some of the most important include:
Each individual has an annual CGT allowance: the first €1,270 of taxable gains in a tax year are exempt from CGT. Married couples or civil partners can each claim this allowance, but it cannot be transferred between you.
Transfers of assets between spouses or civil partners (including after separation or divorce under they are made under a Separation Agreement or a court order) are fully exempt from CGT.
If you sell your main home, you may be exempt from CGT. This exemption may also apply to:
Restrictions may apply depending on the duration and extent of your residence.
If you’re over 55 and selling a farm or business, Retirement Relief may reduce or eliminate your CGT bill, even if you’re not retiring.
Read more about Retirement Relief for Business Owners in this link
If you dispose of land or buildings bought between 7 December 2011 and 31 December 2014, and held them for at least 4 years, you may be eligible for partial or full relief:
You don’t pay CGT on gains from:
Many people ask: How do I calculate Capital Gains Tax?
1. Determine the sale price or market value (for gifts/inherited assets).
2. Subtract the purchase price.
3. Deduct allowable expenses, such as:
4. Apply any reliefs or exemptions (e.g., €1,270 personal allowance).
5. Multiply the remaining taxable gain by the appropriate CGT rate (usually 33%).
You must pay online through:
If you qualify for exemption from online filing, payments can be made via post using CGT Payslip From A or B or email the Payment Accounting section of the Collector-General’s Division.
You must file a return even if no CGT is due. The filing deadline is 31 October of the year following the disposal.
Forms can be filed via ROS or posted to your local Revenue office.
You can use capital losses to reduce your gains in the same tax year subject to certain exceptions. Unused losses can be carried forward to future years, but not back to previous ones.
You may need to pay CGT on the sale of a second home, investment property, or land. Always check if Principal Private Residence Relief applies.
Selling shares, whether in Irish or foreign companies, can trigger CGT. If the shares were inherited, your base cost is the market value at the date of inheritance.
Making informed financial decisions can be complex, especially when they involve tax implications, investment planning, and long-term financial goals. That’s why it’s essential to seek professional advice.
Before taking any action, make sure to get appropriate tax advice to understand the implications for your individual circumstances. Once your tax position is clear, Fairstone can support you in building a tailored financial plan that aligns with your goals and helps secure your financial future.
Book today a no-obligation financial planning consultation with Fairstone. Our expert advisers are here to guide you through each stage, ensuring your plan is both effective and tax-efficient.
Sources:
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Disclaimer:
Information as of 26/06/2025
This article does not constitute tax 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 tax 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.
This week, former U.S. President Donald Trump made a notable adjustment to his longstanding trade policy stance. After years of advocating for broad-based tariffs, he announced a shift, stating that tariffs would now be used “strategically” and “only when necessary.” The announcement comes as a surprise to many, given the consistency of his messaging on trade since 2016. While the change has been framed as a strategic move, market signals point to a different story, one shaped by the bond market.
At the centre of the shift was a key moment in the U.S. Treasury’s financial calendar, the auction of $70 billion in 10-year bonds. Investor interest was subdued, resulting in lower prices and rising yields. This indicated that the U.S. government would now need to offer higher returns to attract buyers, increasing its borrowing costs. For policymakers, this was a clear signal: investors were becoming more cautious, particularly with renewed concerns about inflation and uncertainty surrounding future trade policy.
Rather than citing market sentiment directly, Trump’s economic team suggested the change in approach was a sign of strategic success U.S. Treasury Secretary Scott Bessent argued that the lack of retaliation from trade partners proved the strategy was effective. However, many observers pointed to the bond market’s reaction as the real driver behind the decision. When confidence in fiscal and trade stability appears to waver, global investors respond quickly, and in this case, decisively.
The bond market’s influence is often underestimated in public discourse, yet it plays a critical role in shaping economic outcomes. Investor behaviour in bond auctions can offer insights into broader confidence in government policy, economic direction, and market stability. This latest development reinforces how sensitive markets can be to policy announcements, especially those that could impact inflation or borrowing dynamics.
For investors, this episode is a timely reminder of how global markets remain deeply interconnected. While the U.S. remains one of the most resilient and attractive economies globally, this event has prompted some to consider alternative investment regions that may offer more consistency and predictability. Europe, Asia, and selected emerging markets could see increased interest from investors seeking diversification and reduced exposure to policy-driven volatility.
Importantly, this shift does not signal the end of tariff discussions. The policy has not been eliminated, only postponed. A 90-day window remains in place, during which trade decisions could change again. As such, investors should expect continued market sensitivity to developments from Washington in the months ahead.
Amid political uncertainty and fluctuating markets, expert financial guidance can provide clarity and direction. Sudden changes in policy, such as shifts in tariff strategy or bond market reactions, can create ripple effects that impact individual investment portfolios. Without a clear strategy, it’s easy to make reactive decisions based on short-term headlines.
This is where professional advice becomes essential. A financial adviser helps investors navigate volatility, assess risk appropriately, and stay focused on long-term objectives. With the right plan in place, it becomes easier to manage uncertainty and avoid emotional decision-making during turbulent periods.
At Fairstone, we provide tailored investment advice backed by experience and market insight. Our advisers work closely with clients to understand their goals and develop a strategy that fits their needs, even when markets are unsettled. Whether you’re reviewing your portfolio, rebalancing your risk exposure, or planning for the future, our team is here to support you.
Book your no-obligation investment planning consultation today and take the first step toward a confident, well-informed investment journey, whatever the market brings next.
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Source: Bloomberg 2025
The journey to leadership is often fraught with unique challenges, especially for women. Despite progress in gender parity, women remain underrepresented in senior management roles globally. In Ireland, for instance, the Grant Thornton Women in Business 2024 report highlights that only 33% of senior management roles are held by women. As women continue to break barriers in business, financial planning becomes a critical tool to help them balance career ambitions, wealth accumulation, and personal life goals.
This blog explores the importance of financial planning for women in leadership, addressing the unique challenges they face and offering actionable insights to achieve financial independence and security.
Despite strides toward gender equality, the lack of women in senior management remains a persistent issue. The Grant Thornton Women in Business 2024 report reveals that while progress has been made, women still face systemic barriers, including unconscious bias and limited access to mentorship opportunities. In Ireland, the numbers are improving but still fall short of true gender parity.
Research consistently shows that diversity in leadership drives better business performance. Companies with gender-diverse leadership teams are more innovative, financially successful, and better equipped to navigate complex challenges. Achieving gender parity in leadership is not just a moral imperative but a business necessity.
Women in leadership often face unique financial challenges, including the gender pay gap, career interruptions for caregiving, and longer life expectancies. These factors can significantly impact their ability to build wealth and achieve long-term financial security.
The gender pay gap remains a significant barrier for women in leadership. On average, women earn less than men, which affects their ability to save and invest for the future. Closing this gap is essential for achieving financial equality.
Many women take career breaks to care for children or ageing parents, which can disrupt their earning potential and retirement savings. Effective financial planning can help mitigate the impact of these interruptions by creating a safety net and ensuring continued financial growth.
Women generally live longer than men, which means they need to plan for a longer retirement period. This requires careful financial planning to ensure that savings and investments last throughout their lifetime.
Women in leadership roles often juggle demanding careers with personal responsibilities, such as raising children or caring for ageing parents. Effective financial planning helps them balance these competing priorities while ensuring their financial goals remain on track.
Start by creating a comprehensive financial plan that includes budgeting, saving, and investing. A solid financial foundation provides the stability needed to pursue long-term goals, such as retirement planning or funding a child’s education.
Budgeting is the cornerstone of financial planning. It helps you track your income and expenses, identify areas for savings, and allocate funds toward your financial goals. Building an emergency fund is also crucial to cover unexpected expenses without derailing your financial plan.
Women often tend to be more risk-averse when it comes to investing. However, investing is essential for wealth accumulation. Consider working with a financial advisor to develop an investment strategy aligned with your risk tolerance and financial goals.
Diversifying your investment portfolio can help mitigate risks and maximise returns. A mix of stocks, bonds, and other assets can provide a balanced approach to growing your wealth over time.
With longer life expectancies, women need to plan for a retirement that could last 30 years or more. Maximise contributions to retirement accounts and explore additional savings vehicles to ensure a comfortable retirement.
Take full advantage of employer-sponsored pension plans and consider additional retirement savings options, such as personal pensions or Additional Voluntary Contributions (AVCs). Regularly review your retirement plan to ensure it aligns with your long-term goals.
Insurance is a critical component of financial planning. Ensure you have adequate coverage, including life, health, and disability insurance, to protect your wealth and provide for your loved ones in case of unforeseen events.
Estate planning is another essential aspect of protecting your wealth. Creating a will and setting up trusts can ensure that your assets are distributed according to your wishes and provide for your family’s future.
Navigating the complexities of financial planning can be overwhelming. A financial advisor can provide tailored advice to help you achieve your goals, whether it’s growing your wealth, planning for retirement, or balancing career and life priorities.
A financial advisor can help you create a personalised financial plan that addresses your unique circumstances and goals. They can also provide ongoing support and guidance to help you stay on track and adapt your plan as your needs evolve.
Financial planning is not a one-size-fits-all process. For women in leadership, the complexities of balancing career, wealth, and life goals require a personalised approach. Seeking professional financial advice ensures that your financial plan is tailored to your unique circumstances and goals.
At Fairstone Ireland, we understand the challenges women in leadership face. Our team of experienced financial advisors provides tailored financial advice to help you achieve financial independence and security. Whether you’re planning for retirement, investing for the future, or balancing competing priorities, we’re here to support you every step of the way.
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This article is for general information purposes and is not an invitation to deal or address your specific requirements.
Financial planning is a critical step in securing your financial future, whether you’re planning for retirement, managing investments, or navigating life’s unexpected challenges. For many, the idea of meeting with a financial advisor in Ireland can feel daunting, but understanding what to expect from a financial planning consultation can help you approach the process with confidence. In this blog post, we’ll walk you through what a financial planning consultation typically involves, why it matters, and how it can benefit you.
Before diving into the consultation process, it’s important to understand what a financial advisor does. A financial advisor, also known as a financial consultant or financial planner, is a professional who provides expert guidance on managing your finances. Their role is to help you make informed decisions about your money, whether it’s planning for retirement, investing, saving for a major life goal, or protecting your wealth.
In Ireland, financial planners work closely with clients to create tailored strategies that align with their unique financial goals and circumstances. From Irish pensions and finance to investment management, a financial advisor can offer comprehensive support to help you achieve financial stability and growth.
The first step in the financial planning process is preparation. Before meeting with a financial advisor, it’s helpful to gather relevant documents and information. This might include:
Having this information ready will allow your financial consultant to gain a clear understanding of your current financial position and provide more accurate advice.
The consultation typically begins with a thorough review of your current financial situation. Your financial advisor will ask questions about your income, expenses, assets, and liabilities. This helps them understand your financial health and identify any areas that may need attention.
For example, if you’re based in Ireland, your advisor may discuss your Irish pensions, savings, and investments to assess how well they align with your goals. This step is crucial for creating a financial plan that is both realistic and effective.*
*Fairstone Ireland can only provide advice to Irish residents. We are not authorised to transact business for non-residents or offer advice on non-Irish pensions or investments.
Next, your financial planner will work with you to define your financial goals. These could include saving for a home, funding your children’s education, planning for retirement, or building an investment portfolio.
By understanding your aspirations, your advisor can tailor their recommendations to suit your needs. Whether you’re looking for short-term solutions or long-term financial planning in Ireland, this step ensures that your plan is aligned with your priorities.
During the consultation, your financial advisor will also identify potential challenges that could impact your financial future. This might include market volatility, inflation, or changes in tax legislation.
Additionally, a critical challenge to address is protection against unexpected events such as accidents, illness, or injury, which could derail your financial goals. Your advisor can recommend strategies to safeguard your income and ensure you’re prepared for life’s uncertainties.
At the same time, they will highlight opportunities to grow your wealth, such as tax-efficient investments or strategies to maximise your Irish pensions. By addressing both challenges and opportunities, your advisor can help you build a resilient financial plan.
Based on the information gathered, your financial consultant will create a customised financial plan tailored to your unique circumstances. This plan may include:
Your financial planner will explain each aspect of the plan in detail, ensuring you understand how it works and how it will help you achieve your goals.
A key part of the consultation is addressing any questions or concerns you may have. Whether you’re unsure about the best way to invest or want to know more about Irish pensions and finance, your advisor is there to provide clear, expert guidance.
This is also an opportunity to discuss any changes in your life that might affect your financial plan, such as a new job, marriage, or the birth of a child.
Read more about Financial Planning for Major Life Transitions in the following link.
Seeking expert financial advice is crucial for making informed decisions about your money. A financial advisor in Ireland can provide valuable insights and strategies that you may not have considered on your own. Here are some reasons why professional financial planning matters:
Every individual’s financial situation is unique. A financial consultant can create a plan that is tailored to your specific needs and goals, ensuring you get the most out of your money.
Financial planners in Ireland have in-depth knowledge of the local market, pension options, and investment opportunities. This expertise allows them to provide advice that is both relevant and effective.
By working with a financial advisor, you can build a plan that not only addresses your immediate needs but also secures your financial future. Whether it’s planning for retirement or protecting your wealth, expert advice can help you achieve long-term stability.
Knowing that your finances are in good hands can provide significant peace of mind. With a clear plan in place, you can focus on enjoying life without worrying about money.
At Fairstone, we understand that financial planning is about more than just numbers—it’s about helping you achieve your dreams and secure your future. Our team of expert financial advisors in Ireland is dedicated to providing personalised, professional advice that meets your unique needs.
Whether you’re looking to grow your wealth, plan for retirement, or navigate a major life change, we’re here to help. Our comprehensive approach to financial planning ensures that every aspect of your finances is considered, from Irish pensions to investments and wealth protection.
Get in touch with Fairstone today to book a no-obligation financial planning consultation and take the first step toward achieving your financial goals. With our expert guidance, you can transform uncertainty into opportunity and build a brighter financial future.
Fairstone Ireland does not provide tax, legal, or accounting advice. For more information, please consult a qualified tax professional.
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In today’s competitive business landscape, employee share schemes have become an increasingly important tool for attracting and retaining top talent. However, managing employee share options requires careful financial planning to maximise benefits and minimise risks for both employers and employees. The complexity of these schemes, combined with their significant potential impact on financial futures, makes proper planning not just beneficial, but essential.
Employee share option schemes in Ireland have evolved into a sophisticated mechanism for aligning company and employee interests. These schemes serve multiple purposes, including:
Several types of employee share schemes exist in Ireland, each with its unique features and benefits:
Restricted Share Schemes allow companies to award shares to employees with substantial tax benefits in return for agreeing to specific restrictions.
Key Features:
Tax Benefits:
Restricted shares provide significant tax savings, depending on how long the restrictions last:
If restrictions are lifted early, the tax benefits are recalculated. Employers are responsible for accounting for additional tax due when restrictions are shortened.
This scheme is ideal for companies looking to reward and retain employees while ensuring long-term commitment.
An APSS allows companies to award shares to employees in a tax-efficient way.
How It Works:
Tax Benefits:
Who Can Participate?
The scheme must be offered to all qualifying employees on similar terms. Companies benefit from tax deductions for the costs of establishing and contributing to the trust.
SAYE combines a savings plan with a share option scheme, making it an attractive choice for employees who want to own company shares without an upfront investment.
How It Works:
Tax Benefits:
This scheme is inclusive and must be available to all qualifying employees. It’s an excellent way to encourage share ownership while providing tax advantages.
Employee Share Ownership Trust (ESOT):
An ESOT holds shares for employees for up to 20 years. It’s commonly used by state or semi-state organisations and often works alongside an APSS.
Key Employee Engagement Programme (KEEP):
Designed for small and medium-sized enterprises, KEEP offers employees share options with exceptional tax benefits. Employees pay no income tax, USC, or PRSI on gains when exercising options, making it attractive for key talent retention.
Unapproved Share Option Schemes:
These schemes offer flexibility but fewer tax advantages. From January 2024, companies must deduct income tax, USC, and PRSI at the time employees exercise their options.
Effective financial planning is essential for managing employee share options due to the diverse tax implications of different schemes. Each option has unique rules regarding income tax, Capital Gains Tax (CGT), Universal Social Charge (USC), and PRSI:
For both employers and employees, careful tax planning ensures you can maximise the benefits while minimising financial risks.
Employee share option schemes, particularly in Ireland, are powerful tools for wealth creation but must be aligned with broader financial objectives, such as:
A strategic plan ensures these schemes complement long-term financial ambitions while building sustainable wealth.
Timing is critical when managing employee share options. A robust plan addresses:
For instance, Save As You Earn (SAYE) schemes reward patience, with tax-free gains after exercising options within their set timelines. Planning for these timing factors ensures you don’t miss key opportunities.
Owning employee shares comes with risks that financial planning can mitigate:
By diversifying investments and strategically exercising options, you reduce exposure to these risks while capitalising on growth opportunities.
The landscape of employee share schemes in Ireland continues to evolve, influenced by regulatory changes and market trends. Recent updates, such as the taxation shift in unapproved share options starting in 2024, highlight the need to stay informed.
For multinational companies, cross-border compliance and tax regulations add another layer of complexity. Consulting with professionals ensures schemes remain compliant and optimised for current laws and market conditions.
Employee share schemes can be transformative for wealth creation and business success, but their complexity requires professional guidance. Proper advice ensures that schemes are designed strategically for employers and optimised for employees’ financial goals.
At Fairstone, we offer tailored financial and investment planning advice to help you maximise the benefits of employee share schemes. Book your no-obligation investment consultation today to secure your financial future.
Sources:
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Investing in ETFs in Ireland in 2025
This article does not constitute tax, legal or financial advice and should not be relied upon as such. Although endeavours have been made to provide accurate and timely information of the various source materials, 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. The 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.
In today’s evolving financial landscape, many Irish families are seeking effective ways to secure their children’s financial future. Bare trusts in Ireland have emerged as a popular and efficient solution, offering a structured approach to wealth transfer while maintaining tax efficiency. Whether you’re planning for education costs, a future house deposit, or general wealth building, understanding how bare trusts work in Ireland is essential for making informed decisions.
A bare trust, also known as a simple trust or naked trust, is a straightforward legal arrangement where a trustee holds and manages assets on behalf of a beneficiary. Think of it as a protected financial container where assets are held by a trusted guardian until the beneficiary is ready to take control.
Key elements of this structure are:
Establishing a bare trust requires careful planning and usually involves several key steps:
Understanding the tax implications is crucial for maximising the benefits of a bare trust in Ireland. The tax framework offers several advantages that make bare trusts particularly attractive for family wealth planning.
One of the most valuable features is the Small Gift Exemption, which allows:
The CAT system operates on a tiered structure based on relationships:
Any gifts exceeding these thresholds are taxed at 33% on the excess amount only.
* The Capital Acquisitions Tax (CAT) thresholds mentioned are not an exhaustive list and are subject to change. For the most up-to-date and comprehensive information we recommend visiting the Revenue Commissioners website: www.revenue.ie.
Bare trusts can serve multiple purposes in financial planning:
Before establishing a bare trust, consider these key points:
*Always consult a qualified professional for personalised tax advice.
While the structure of a bare trust is straightforward, successful implementation requires careful planning:
At Fairstone, we specialise in helping families navigate the complexities of bare trusts while maximising their benefits. Our expert wealth management advisors can help you design appropriate trust structures, implement effective investment strategies, ensure tax efficiency* and plan for long-term success.
Whether you’re looking to secure your children’s financial future, plan for education costs, or create a structured wealth transfer strategy, our team can guide you through the process of establishing and managing a bare trust that meets your family’s needs.
To learn how we can help you create a secure financial future for your loved ones through strategic bare trust planning book a no-obligation financial planning consultation today. Our comprehensive approach ensures that your family’s financial planning goals are met while maximising available tax benefits and maintaining full compliance with Irish regulations.
*Always consult a qualified professional for personalised tax advice.
Source:
Revenue.ie
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Life is full of changes, both expected and unexpected. From starting your first job to retiring, from marriage to parenthood, and even during difficult transitions like divorce or the loss of a loved one, every major life event brings unique financial challenges and opportunities. Financial planning for major life transitions is crucial to ensure your long-term stability and peace of mind. By creating a tailored financial strategy with the help of a financial advisor, you can navigate these transitions more effectively and secure a bright future.
This article explores the key financial considerations for major life transitions and provides practical tips to help you manage your finances during pivotal moments.
Major life events often bring not only emotional changes but also significant financial implications. Diverse circumstances such as navigating a higher income from a job promotion, welcoming a new family member, or managing finances after a loss all require proactive planning to help you adapt seamlessly.
Without a clear financial plan, these transitions can lead to stress, poor financial decisions, or missed opportunities to grow your wealth. By evaluating your financial priorities and taking intentional steps, you can ensure that these changes are a chance to thrive, not just survive.
The transition from education to employment is a critical moment to build a strong financial foundation. Your first paycheck offers an opportunity to establish healthy habits and secure your future.
Marriage is a joyful milestone, but it’s also one of the most significant financial contracts you’ll ever enter. Early communication and planning are key to avoiding financial conflicts.
Parenthood brings immense joy—and significant financial responsibilities. Childcare, education, and extracurricular activities require careful budgeting and planning.
Divorce is emotionally and financially challenging. Proactive financial planning can help you stay clear-headed and make informed decisions.
The death of a loved one is a deeply emotional time, but it also comes with financial responsibilities.
Retirement is one of life’s most anticipated transitions, but it requires decades of preparation. As you near this stage, focus on maximising your resources.
Regardless of the specific life event, there are universal strategies to ensure your financial well-being during transitions:
1. Work with a Financial Advisor
An experienced financial advisor can provide objective advice, tailor strategies to your needs, and help you avoid costly mistakes. Their expertise is particularly valuable when emotions might cloud judgment.
2. Prioritise and Budget
Each transition shifts your financial priorities. By creating or adjusting a budget, you can allocate resources effectively and reduce unnecessary expenses.
3. Protect Your Assets
Ensure your insurance policies are up-to-date and appropriate for your new circumstances. This includes life insurance, health coverage, and income protection
4. Keep Liquidity
During transitions, having access to liquid assets is crucial. Avoid locking up too much money in investments that are difficult to access.
5. Plan for Taxes
Whether you’re managing an inheritance, receiving a divorce settlement, or changing jobs, understanding tax implications is essential to preserving your wealth.
Life transitions can be unpredictable, but having a financial plan in place provides stability and clarity. Here’s why proactive planning is critical:
At Fairstone, we understand that every individual’s journey is unique. Our expert financial advisors are dedicated to helping you navigate life’s transitions with confidence. By crafting a tailored financial plan, we ensure that your financial strategy aligns with your goals, needs, and future aspirations.
No matter what stage of life you’re in, proactive financial planning is the key to a secure future. Don’t leave your financial well-being to chance. Contact Fairstone today and book a no-obligation financial planning consultation with one of our expert advisors and take the first step toward achieving your financial goals.
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The Finance Bill 2024 introduces several key taxation changes that will have significant impacts on personal finances, businesses, and retirement planning. In addition to changes in income tax and various reliefs, the bill outlines reforms related to Personal Retirement Savings Accounts (PRSA), Benefit in Kind (BIK), the Standard Fund Threshold (SFT), and Auto Enrolment—all of which are critical in shaping the financial future of employees and employers alike.
This article will address the effects of the most significant changes in the Finance Bill 2024, especially those related to retirement savings, tax reliefs, and how these updates will affect individuals and businesses in Ireland.
The Finance Bill 2024 has introduced crucial updates to the PRSA system, making it easier for employers to contribute to employees’ retirement savings while offering tax benefits. Under the new legislation, the maximum employer contribution to a PRSA is now capped at 100% of an individual’s salary in the year of payment.
For instance, if an employee or director has a salary of €50,000 in 2025, the maximum employer contribution to their PRSA would also be €50,000. This is a significant development as previously, employer contributions to PRSAs were more restrictive, and this change incentivises greater retirement savings for employees.
However, any contributions that exceed this 100% cap will be treated as a Benefit in Kind (BIK) for the individual. This means that any amount over the capped limit would be considered taxable income and subject to income tax. Employees and employers should carefully monitor contributions to avoid unintended tax liabilities. For businesses, the Finance Bill still allows them to claim a deduction against Corporation Tax for contributions to PRSAs up to 100% of an individual’s salary. However, the same deduction cannot be claimed for contributions beyond this threshold.
One of the most critical aspects of the Finance Bill 2024 is the clarification of BIK treatment concerning PRSAs. As mentioned, employer contributions beyond 100% of an individual’s salary are deemed BIK, adding a new layer of complexity for businesses managing employee benefits. This means therefore that organisations must monitor PRSA contributions to avoid unintentionally exposing their employees to additional income tax liability.
For employees, this treatment of BIK can result in larger liabilities being incurred for income tax bills where their employer has made excessive contributions to their retirement savings. This shift emphasises the importance of payroll and financial management, as contributions will need to be carefully controlled to stay within the tax-free limits.
The Standard Fund Threshold (SFT), which is the lifetime limit on the amount of tax-relieved pension savings an individual can accumulate, has also been addressed in the Finance Bill 2024. As developments in pension saving environments progress, the finance bill makes adjustments to how funds that exceed the SFT are treated.
Previously, pension savings over the SFT were subject to tax penalties, which limited the amount individuals could save through tax-advantaged pension schemes. The Finance Bill has brought much-anticipated clarity to this area, with changes expected to simplify retirement planning while ensuring that pension contributions are effectively capped. The exact threshold changes are still pending, but the bill makes it clear that the government intends to ensure that the retirement saving benefits remain appealing without overburdening the public purse.
Another key element introduced in the Finance Bill 2024 is the Auto Enrolment Retirement Savings Scheme, seeking to increase the number of workers who save towards retirement. Auto-enrolment is a significant change, especially for those who may not currently be saving enough for their retirement. It ensures that employees are automatically enrolled in a pension scheme, with contributions coming from both employees and employers.
The bill defines how the taxation of such schemes and their administration will be carried out. In particular, employee benefits including employer contributions and the state’s top-up payments will be relieved from taxation which is a critical feature of the scheme. This means that while employees contribute to their retirement savings, they benefit from both employer contributions and a government top-up without having to worry about tax deductions on those amounts.
The growth within these retirement savings will be tax-exempt, although withdrawals upon retirement will be taxed, except for the 25% tax-free lump sum that many pension schemes in Ireland already provide.
Auto-enrolment is designed to tackle Ireland’s pension gap, ensuring that more people are financially secure in retirement. The scheme will especially benefit lower and middle-income workers, who often do not have access to employer-provided pensions.
For employers, the scheme introduces new obligations. Under the new system, companies will be obligated to make pension contributions on behalf of their employees, potentially increasing their financial and administrative responsibilities. However, the tax relief available on employer contributions provides a silver lining, allowing businesses to claim deductions that reduce their tax burden.
Additionally, as auto-enrolment is phased in, there will be a period of adjustment for employers to ensure compliance with the new regulations. This shift towards greater pension participation will require payroll systems to adapt to these changes, ensuring that both employer and employee contributions are correctly processed and managed.
Read more about The Implications of Auto Enrolment for Business Owners in the following link.
Beyond changes to retirement savings, the Finance Bill 2024 introduces a host of other tax measures designed to support individuals and businesses. Notably, the bill includes a personal income tax package worth an estimated €1.6 billion for 2025. Key elements include increases to the main personal tax credits and an adjustment to the standard rate income tax band.
These changes are intended to ease the plight of employees by enhancing disposable income, especially in the face of higher costs of living. The bill also adjusts the Universal Social Charge (USC), raising the 2% rate band ceiling and reducing the 4% USC rate to 3%, further easing the tax burden on those on medium earnings.
The Small Benefits Exemption has been a popular way for employers to reward employees with tax-free vouchers or gifts. Under the Finance Bill 2024, this exemption has been expanded. Effective 1 January 2025, employers will be allowed to offer up to five tax-free incentives per year (up from two), and the total annual value that can be given tax-free will increase from €1,000 to €1,500.
This change makes it possible for businesses to pay and motivate employees in different ways as providing non-cash benefits that are free from BIK taxation becomes easier.
The Finance Bill 2024 introduces several important changes impacting both businesses and employees, including updates to Benefit in Kind (BIK) related to PRSAs, adjustments to the Standard Fund Threshold (SFT), and the introduction of auto-enrolment for retirement savings. These changes reshape the landscape of taxation and employment benefits, requiring businesses to stay informed and adapt to comply with new rules.
As for the employees, the bill enlarges the tax reliefs and improves the Small Benefit Exemption, while employers now can have some deductions on PRSA contributions and offer more non-cash flexible benefits. These changes bring opportunities but also challenges.
Fairstone’s expert financial advisors are equipped to help you understand and navigate these updates. Whether it’s ensuring compliance with PRSA contribution limits, managing BIK implications, or leveraging auto enrolment benefits, Fairstone can guide you through the evolving financial landscape.
Staying informed and receiving professional advice will be key to effectively managing these changes. Fairstone is ready to assist both businesses and individuals in adapting to the new regulations and maximising the available benefits. Book today your no-obligation financial planning consultation with Fairstone.
Source:
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