Capital Gains Tax
The standard rate of Capital Gains Tax (CGT) in Section 28 (3) of Taxes Consolidation Act 1997 (TCA) has been reduced from 33% to 31% effective from 7 October 2026.
This rate change is part of measures designed to help increase and expand domestic investment activity. Lowering the CGT rate will also contribute to Ireland’s competitive position for attracting international investment.
Capital Acquisitions Tax Thresholds
As set out in the Budget, the CAT tax free thresholds have been increased as follows:
CAT Group A from €400,000 to €420,000;
CAT Group B from €40,000 to €44,000;
CAT Group C from €20,000 to €22,000.
These new thresholds apply to gifts and inheritances taken on or after 7 October 2026 (the day after Budget day).
Support and Maintenance Exemption
Finance (No. 2) Bill 2026 proposes to amend the support, maintenance and education exemption contained in section 82 of the Capital Acquisitions Tax Consolidation Act ("CATCA") 2003.
The principal change is that the exemption may now apply where qualifying support, maintenance or education is provided following the death of one parent, notwithstanding that the surviving parent remains alive.
If enacted, the amendment will broaden the scope of the exemption and remove a restriction which could prevent relief from applying in circumstances where support is provided for a qualifying child following the death of a parent.
While the amendment extends the availability of the exemption, its practical impact may be relatively limited. In practice, the support, maintenance and education exemption is more commonly relied upon during a parent's lifetime.
CAT Business Relief
A technical amendment has also been included in the replacement property provisions in section 101 CATCA 2003 to clarify the position where relevant business property is transferred from one company to another on foot of a merger or division. The wording has been amended from "sold" to "disposed of", aligning it with terminology used in previous technical amendments to the section.