Finance Bill 2025 Highlights

BDO Ireland
Insights
2025
Finance Bill 2025
Finance Bill 2025 Highlights

The Minister for Finance, Paschal Donohoe, has published the Finance Bill 2025, giving legislative effect to the taxation measures announced on Budget Day and introducing a range of administrative and technical amendments to the tax code.

Spanning over 100 sections, the Bill outlines significant updates affecting businesses and individuals across multiple sectors.

Our BDO experts explain the key provisions and what these changes mean in practice — helping you understand their impact and prepare with confidence.

Personal Tax

Finance Bill 2025 includes the reduction in USC announced on Budget Day, the reduction in tax rate for certain investment products, and the extension of mortgage interest relief, among other changes. Find out more here.

Capital Taxes

The Bill increases the lifetime limit for disposals qualifying for Revised Entrepreneur Relief to €1.5 million in respect of disposals made on or after 1 January 2026, as announced on Budget Day. Read more here.

Business Tax

Key changes include enhancements to the R&D Tax Credit regime and the Participation Exemption regime for Foreign Dividends introduced last year. The Bill further introduces an exemption from Dividend Withholding Tax for Investment Limited Partnerships. Discover more details here.

Employment Tax

The Bill provides for the extension of KEEP, SARP, and FED, along with further amendments to the reliefs. Read more here.

Farming Measures

A reduction in the flat-rate VAT scheme for farmers is to be implemented from 5.1% to 4.5% on 1 January 2026. The Bill also provides for the extension of a number of farming-related tax reliefs, as announced on Budget Day. Read more here.

Property Related Measures

A number of significant property-related measures, as announced on Budget Day, are provided for in the Bill. Find out more here.

Vehicle Taxation

The Bill contains a number of changes to the BIK treatment of vehicles, along with an extension of VRT relief for electric vehicles. Learn more about vehicle tax measures here.

VAT

An extension of the 9% VAT rate for gas and electricity is provided for in the Bill, along with the reduction in VAT rate for the hospitality sector, as announced on Budget Day. Read more about VAT changes here.

Excise

The Bill includes an increase in excise duty on tobacco products, which came into effect from midnight on Budget night. Find out more on excise duties here.

Department of Finance Documents

The Dáil Second Stage of the Finance Bill 2025 is expected to begin next week, and it is expected that the Finance Act 2025 will be signed into law before the end of 2025.