Budget 2021

A lifeline for struggling businesses with strategic spend to support vulnerable sectors and jobs.



  • The largest Budget in the history of the State
  • Budgetary package amount is to a total spend of €17.75 billion, unprecedented in its size and scale
  • Spending on core capital programmes will increase by €1.6 billion next year
  • €500m in additional measures for business to keep supporting the economy
  • €270m spend for tax measures
  • PUP not returned to early pandemic levels
  • No obvious changes to cost of living, emphasis on maintaining jobs and income in so far as possible.
  • Two major assumptions underpin the budget – no bilateral trade deal between EU and UK; continued presence of Covid-19 in Ireland next year and absence of broadly available vaccine

Pro-business Measures

  • €1.1bn is being allocated to support local enterprise, SMEs, further funding for R&D and the Credit Guarantee Scheme and the Future Growth Loan Scheme.
  • Announced Covid Restrictions Support Scheme (CRSS)  to support sectors hit hardest by the pandemic, targeted support for accommodation, food, arts, recreation based on 2019 turnover: 10% of 1st €1m, 5% thereafter to a maximum of €5,000pw for businesses operating under level 3 restrictions or above. Paid weekly.
  • Reduced rate of VAT for hospitality and tourism sector from 13.5%  to 9% from 1 November
  • EWSS scheme to be  extended until December 2021. The Government will apply for EU funding towards the cost and this could result in Ireland access just under €2.5bn
  • Further commercial rates waiver worth €300m on the way extended to end December 2020

TAX Measures


  • Total tax package announced of €270m, however no great changes to personal taxes
  • Ceiling of the second USC rate band will be increased from €20,484 to €20,687 to  benefit those on low incomes
  • Good news for self-employed, earned income credit for the self-employed increased to €1,650 from €1,500, finally equaling the PAYE credit. Self-employed workers can delay 2019 tax and 2020 preliminary tax for a year without interest or penalties
  • For those working from home, Minster announced no change to flexible home working allowance – €3.20 per day other than allowing a share of broadband costs to be claimed back in tax. Working remotely and working from home strategy is to come
  • 12.5% corporation tax rate maintained and Government will work to the OECD tax agenda
  • Extension of the Tax Debt Warehousing scheme is to be extended to ease cashflow pressure on businesses. Announced as part of the July stimulus package,  this scheme allows businesses to defer tax repayments and keep VAT and PAYE debts warehoused at 3% interest.
  • CGT rules changed  – CGT Entrepreneur Relief ordinary share holding requirement being amended so that an individual who has owned at least 5% of shares for a continuous period of any three years qualifies for this relief.
  • The relief on stamp duty applied to farm consolidation and land transactions is to be continued for two years. The 1% rate will remain in place until the end of 2022


  • The help-to-buy scheme for first time buyers, the lower of 10% of the value of the property or €30,000, has been extended to the end of 2021.
  • Funding for construction of 9,500 social housing


  • €10 billion for capital expenditure
  • Variety of projects including construction, national broadband and €600m is to be provided for capital investment in 2021 including major road projects like the N56 in Donegal, N4 in Sligo, N5 in Mayo and N22 in Cork, and the purchase of 41 additional InterCity Railcar carriages

Carbon Taxes

  • Carbon tax will be increased by €7.50 from €26 to €33.50 per tonne/Co2 to auto fuels from tonight and all other fuels from 1 May 2021.
  • 2c on 1 litre of petrol and 2.5 c of diesel from midnight tonight.
  • Message seems to be  – the sooner you can get out of a less polluting car the better.

We are here to help. If you have any queries or require assistance in relation to any of the Budget 2021 measures, do get in touch at info@avidpartners.ie or call us on 0818 303 087.

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