Thomas McGibney & Company

Chartered Accountants


Registered to carry on audit work and authorised to carry on investment business by the Institute of Chartered Accountants in Ireland (ICAI). Chartered Accountants Ireland is the operating name of ICAI.

Budget 2010

The following are the details of the Budget, announced by Minister Brian Lenihan on 9 December 2009.

Income Tax

The following Tax Credits are all unchanged for 2010.

Tax Credits Tax Credit	2010 €
Single Person	1,830
Married Person	3,660
PAYE Credit	1,830
Widowed Person (no dependant children)	2,430
One Parent Family Credit	1,830
Incapacitated Child Credit Max	3,660
Blind Tax Credit Single Person One Spouse Blind Both Spouses Blind	1,830 1,830 3,660
Widowed Parent Bereaved in 2009 Bereaved in 2008 Bereaved in 2007 Bereaved in 2006 Bereaved in 2005 Bereaved in 2004	- 4,000 3,500 3,000 2,500 2,000
Age Tax Credit Single/Widowed Married	325 650
Dependent Relative	80
Home Carer	900

Tax Rates and Tax Bands.

The tax rates remain unchanged at 20% (standard rate) and 41% (higher rate). The tax bands are also unchanged.

	2010 €
Single	36,400 @ 20% Balance @ 41%
One Parent Family	40,400 @ 20% Balance @ 41%
Married Couple one Income	45,400 @ 20% Balance @ 41%
Married Couple – dual Income	45,400 @ 20% with increase of 27,400 max. Balance @ 41%

Other Tax Reliefs

The Tax Relief for Employing a Carer is unchanged in 2010. This can be claimed at the marginal rate up to a maximum of €50,000.

Rent Tax Relief is also unchanged. This relief is only available at the 20% rate. For under 55’s, the maximum relief is €2,000/€4,000 respectively for single/married couples. For over 55’s, the maximum relief is €4,000/€8,000 respectively for single/married couples..

Relief on service charges remains unchanged. A maximum of €400 tax relief is granted (at 20% tax rate) in 2010 for service charges paid in the year 2009.

Rent-a-Room Scheme

The maximum exemption from income tax under the Rent-a-Room Scheme remains unchanged at €10,000. This applies to rent received, where a person rents out a room or rooms in their home.

Exemption Limits

The exemption limits for persons aged 65 years and over remain at €20,000 for Single/Widowed & €40,000 for Married Couples

Medical Expenses

Medical expenses relief remains at the standard rate for expenses incurred from 1 January 2009. There is an exception for nursing home expenses, which continue to attract relief at the marginal rate.

Income Levy

The Income Levy rates and thresholds are also unchanged.

2010 Income Levy Thresholds 2010
Rate
Income up to €75,036	2%
Income from €75,037 to €174,980	4%
Income above €174,980	6%

Farmers can now avail of Relief from the income levy for expenditure they incur to comply with the requirements of the EU Nitrates Directive.

VAT

In a welcome move, the standard rate of VAT drops from 21.5% to 21% with effect from 1 January 2010. This reverses the increase of 0.5% announced in the October 2009 Budget.

Start-up Companies

The 3-year Corporation Tax and CGT exemption scheme for start-up companies, introduced in 2009, has been extended to new companies who start trading in 2010.