Ask the experts

Not sure what the budget means for you? Our experts will answer your questions live

Alanna O’Doherty, Dominic Coyle, Beryl Power, Fiona Reddan Wed, Oct 11
 
LIVE: Ask the experts

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  • 07:31

    It’s the morning after the day before.

    Good morning and welcome to The Irish Times’ live post-budget blog where our team of experts will be dealing with all your questions.

    You can submit a question here if there’s something you’d like to know more about.

    Our team this morning consists of in-house experts Dominic Coyle and Fiona Reddan along with PWC tax consultants Beryl Power and Alanna O’Doherty.

  • 07:36

    So, to our first question of the day.

    On social welfare, how much of a rise will disability allowance get? Also, is the telephone package being reintroduced in this budget? And, if so, when will it start? M.

    DC: There will be a €5 rise per week in the disability allowance which, like the other welfare increases, will kick in from the last week of March 2018.

    The telephone allowance has been reintroduced as a Telephone Support Allowance. It will amount to €2.50 a week but will be available only to those receiving both the Living Alone Allowance and the Fuel Allowance - again from the last week of March.

  • 07:44

    What is happening with the Help to Buy scheme for 2018?

    AOD: There were no changes announced by the minister to the Help to Buy scheme (which is currently expected to last until 31 December 2019).

  • 07:49

    We’re back to tax for the next question.

    This reader earns €100,000 a year. “What is the impact on my tax including USC and PRSI? Will there be any changes to pension contributions for defined contribution pensions?”

    AOD: “On the basis that you are a single individual earning €100,000 PAYE income per year, the impact of the increased tax band and reduced USC rates will give rise to an additional c. €328 per annum or c. €27 monthly take home pay. There were no changes to the allowable thresholds for pension contributions.”

    Please see the PwC Tax Calculator for further detail https://www.pwc.ie/2018-bud...

  • 07:53

    Our next question is on property, and from a landlord perspective.

    "What changes are there for private landlords (the reluctant landlords with one property to rent in particular), in terms of deductible expenses or tax treatment?" N.

    DC: "There had been expectations of some relief on deductibles for landlords - reluctant or otherwise - in terms of accelerated mortgage interest relief or relief from Local Property Tax.

    "In the event, the Minister made no announcements in this area. It is still possible that he will return to the issue in the Finance Bill which will be published on Thursday of next week."

  • 08:07

    On business tax, this reader wants to know:

    “Have there been any details published on the Key Employee Engagement programme, and how the relief will work?” D.

    DC: “There are no details yet on how the KEEP share option scheme will work. They are likely to emerge with the Finance Bill, next week.”

  • 08:15

    A question on savings: What's in it for people who save money?

    FR: Despite an expectation that the rate of Dirt levied on savings would fall in 2018, given the Government's intention to cut Dirt by 2 per cent each year over the next three years to hit 33 per cent by 2020, there was no announcement yesterday, so no added incentive for savers. However, further detail might emerge in next week's Finance Bill.

  • 08:16

    On commercial property: I was in the process of buying some commercial property but the deal is not finalised yet. Will the increase in stamp duty apply even though the process has started?

    BP: It is anticipated that there  will be transitional arrangements whereby if a binding contract is entered into before a certain date then the lower rate of stamp duty should apply.   Further details will be published in the upcoming Finance Bill.

  • 08:17

    On tax on rental income: Was anything done for landlords re increasing amount of mortgage interest they could write off as a allowable expense against tax liability?

    FR: No. Although it had been expected that this might rise to 85 per cent for 2018, up from 80 per cent for 2017, no such announcement was made. Watch out for the Finance Bill, due to be published on October 19th.

  • 08:18

    On CGT: Has the exemption on CGT been reduced from seven years? I own a second property for the past five years

    BP: Yes, there is an amendment to the relief known as the “7 year CGT exemption”. Owners of qualifying assets can now sell those assets between the fourth and seventh anniversary of their acquisition and still enjoy full relief from CGT on any chargeable gain.

  • 08:20

    On pensions: Has there been an increase in the retirement age? Most companies make you retire at 65.

    DC: No increase in the retirement age was announced. As of now, the State pension is payable at 66. That will rise to 67 in 2021, and to 68 in 2028 - though those dates could change between now and then. Companies do sometimes have specific retirement ages stipulated in contracts. That was generally because it matched the age of the now defunct State retirement pension payment. Some are amending those rules. Others are slower to act.

  • 08:22

    Inheritance tax: Has the threshold gone up?

    BP: There has been no change to the capital acquisition tax tax-free thresholds.

  • 08:23

    A reader wants to know how they will benefit: I claim illness benefit and I get €188 a week. Is there an increase for me and am I entitled to the Christmas Bonus?

    DC: All welfare payments are getting a €5 increase in the maximum rate payable from the last week of March next year. For illness benefit, where the maximum payment was previously €193 a week, it will now be €198. Illness benefit does not qualify you for the Christmas bonus.

  • 08:25
    On tax:

    “Will there be any change in inheritance tax bands for 2018?”

    DC: “Inheritance tax was another of the measures that went missing in action yesterday. There was no mention of it in the speech despite widespread speculation beforehand that the Category A band of €310,000 would be widened.

    “It could be included in the Finance Bill being published on Thursday of next week but it would be strange for a Minister not to announce such a ‘feel good’ measure in his speech.”
  • 08:25

    On mortgage interest relief: If I have been receiving 30% MIR until this year for my PPR bought in 2008 as a first time buyer, will I receive 22.5%, 15% and 7.5% in the next three years as per the budget or have I got it wrong?

    FR: Home owners who purchased a home in the years 2004-2012 continue to enjoy relief on the interest they pay their lenders on their mortgages. According to yesterday's budget, these homeowners will continue to enjoy relief, but it will taper or decline over the next three years, dropping to 75 per cent of the existing relief in 2018; to 50 per cent in 2019 and 25 per cent in 2020. The relief will stop in 2021. To clarify your point, it means that if you're currently receiving benefit of €500 a year in relief, it will drop to €375 next year, €250 the next, and so on.

  • 08:26

    Another question on CGT: Were there changes to the 33% Capital Gains Tax on selling of a private property?

    DC: Nope. There was no amendment to the current capital gains tax rate of 33 per cent on the sale of assets, or any change to the CGT exemption level of €1,270 in any given year.

  • 08:27

    Tax thresholds: One reader wants to know has the standard rate threshold for married couples with one income increased?

    FR: Yes, the threshold for married couples with one earner has also risen, up also by €750 from €42,800 to €43,550.

  • 08:28

    What benefit did the budget have for public servant pensioners?

    DC: There were no specific measures relating solely to public sector pensioners, although, depending on the level of their income, they will benefit from the cut in USC rates and the rise in the income tax threshold at which they move into the higher 40 per cent tax band.

  • 08:29

    Our next question is property-related.

    “I have read that the seven year period for Capital Gains Tax (CGT) exemption has been reduced to four years. Does this relate to the relief introduced for properties bought in 2012-2014?

    “If so does CGT start to accrue after four years or does this mean that CGT won't start to accrue until after seven years as normal but you can now sell after four years CGT free (ie between four and seven years you can sell entirely free of CGT)?

    “It would be quite unfair if CGT started to accrue now after four years as I have already held my property for five years in anticipation of having to hold it for seven years in accordance with the terms of the original relief from budget 2012.”

    DC: “The budget has amended the rules on capital gains for section 604A properties bought between 2012 and 2014, but you need not worry.

    “Where previously, you had to hold on to the properties for seven years to secure the CGT relief, this has now been amended to ‘between four and seven years’.

    “Essentially, you can sell on after four years without losing access to the relief but, for people like you, who acquired with the intention of holding on to the investment for seven years, there is nothing to stop you continuing to do so.”

  • 08:29

    On the new share scheme: In relation to the KEEP scheme for share options granted in SME companies, will this apply to existing employees?

    AOD: Further detail is awaited but the incentive will be available for options granted to employees between 1 January 2018 and 31 December 2023

  • 08:33

    This reader earns a base salary €67,140 but Benefit in Kind on a company car pushes her salary above €70,000 for the purposes of USC.

    “If PRSI was previously calculated on base salary only, and USC was calculated on all income including notional pay, which figure with be used for the new merged PRSI/USC contribution?” S.

    DC: “There is no new merged PRSI/USC contribution. Despite the support of the Taoiseach Leo Varadkar for such a measure in his Fine Gael leadership campaign and the commitment of the Minister for Finance Paschal Donohoe to bring it in, no mention was made in the speech yesterday of any merger to create a new single social insurance payment.

    “There might be some reference in the Finance Bill to planning for such a merger but it is now more likely to feature next year in Budget 2019.”

  • 08:35

    On property:

    “Does the increase in stamp duty apply to domestic houses? If so, what a hammering for first time buyers, who are already struggling to purchase given prices - especially with the phasing out of mortgage interest relief.” AC

    BP: “The increased rate of stamp duty does not apply to domestic houses – only commercial property.”

  • 08:39

    Now, a health-related issue.

    "The threshold for the drugs payment scheme falls from €144 to €134. Does this mean the maximum you have to pay per month is now €134?” MC.

    FR: “Yes that is correct. The move should save people who reach the limit each month €120 a year.”

  • 08:42

    On property:

    “Will there be a transition arrangement on the commercial stamp duty rise for someone who is mid purchase right now?” DN.

    DC: “The general rule in cases like this is that some transitional arrangements are put in place to cover transactions in play when the new tax measures are announced.

    “We won't know for sure until the Finance Bill, which will be published on Thursday of next week. There was a vote taken in the Dáil last night to implement the change in commercial stamp duty to six per cent from two per cent, but no details of the measure were provided.”

  • 08:44

    “Any change in inheritance tax allowance?”

    BP: “There have been no changes to the CAT tax-free thresholds.”

  • 08:44

    Were there any changes to CAT and exit taxes?

    BP: There were no changes to fund exit tax in the Budget.   The only CAT change relates to an extension of CAT agricultural relief to lands placed under solar infrastructure where certain conditions are met.

  • 08:46

    I earn approx. €58,000 a year and my husband earns similar; are we going to benefit?

    FR: A married couple with combined earnings of about €116,000 will stand to save about €11 a week, or €50 a month

  • 08:47

    Another question from a landlord:

    “I’m a landlord in a privately rented property. Are there any changes in the budget that will affect me?” K.

    FR: “It was expected that budget day would signal some tax relief for landlords, either in a further increase in the amount of mortgage interest relief that could be deemed to be tax deductible, or allowing property tax to be offset against a tax bill.

    “However neither or these measures were announced. Instead, the Government announced a tax deduction on pre-letting expenses for vacant properties coming to the market. However, as you are already a landlord this may not apply to you.”

  • 08:47

    An important question for landlords: Will the increase of stamp duty on commercial transactions from 2% to 6% also apply to the purchase of buy to let houses and/or apartments as they are regarded as 'commercial' properties for some tax purposes?

    DC: Our understanding is no. The Minister made specific reference to a refund scheme in relation to the new higher commercial stamp duty rate on the sale of land for residential housing. On that basis, there is little likelihood of him penalising sales of buy-to-let houses or apartments. Full details will only emerge in the Finance Bill due next week, even though the initial vote to confirm the new tax rate was passed in the Dáil last night.

  • 08:48

    Were there tax increases on alcohol?

    FR: No, there was no change in excise imposed on the price of alcohol yesterday. Cigarettes will go up by 50 cents while a new sugar tax was also introduced.

  • 08:51

    Back to education, and this reader’s three-year-old is in the first year of the Early Childhood Care and Education scheme.

    “Currently, it is from Sept - June for two years. Does that mean he will get thee hours preschool per day throughout the summer too? When does this start, from this summer or from September?” MR.

    FR: “No it doesn't. The ECCE scheme is currently offered for an average of 61 weeks over two years, but from September 2018 it will be extended to a ‘full two year service’.

    “What this means in practical terms however, is increasing coverage to 72 weeks in total, or 38 weeks a year, so the scheme will still only cover term time childcare.”

  • 08:53

    On property:

    “Will an individual who bought a property in 2013 get relief for four years only, or, if he retains the property, will he get the relief to a maximum of seven years in he decides to sell in 2020?” J.

    BP: “The owner of qualifying assets can now sell those assets between the fourth and seventh anniversaries of their acquisition and enjoy full relief from CGT on any chargeable gains where all the conditions of the CGT seven year exemption are met.”

  • 08:56

    A couple of questions we’ll take together on whether there were any increases to the State pension, or children’s allowance?

    There was a €5 weekly increase in the state pension, but no change to child benefit, which remains at €140 a month per child.

  • 09:01

    Now a question on mortgage interest relief.

    “Does it apply to a principle private residence purchased in 2011 but subsequently refinanced to avail of lower interest rates with a new lender? At all times the capital amount of the loan did not increase.” AG.

    FR: “According to Revenue guidance, a ‘re-mortgage’ is a qualifying loan for the purposes of mortgage interest relief. As the original loan was taken out during the eligible time period (ie 2004-2012), you should continue to qualify until 2020.”

  • 09:03

    On tax:

    “Have there been any changes with regards to CGT and entrepreneur relief?” L.

    BP: “There have been no changes to entrepreneur relief in the Budget. The only CGT changes relate to the CGT seven year exemption, and a small change to CGT retirement relief relating to lands placed under solar infrastructure.

    “In relation to the CGT seven year exemption, the owners of qualifying assets can now sell those assets between the fourth and seventh anniversaries of their acquisition and enjoy full relief from CGT on any chargeable gains.”

  • 09:10

    A couple more questions on tax.

    JOL earns €33,000 a year, and wants to know what difference the budget will make to him?

    AOD: “A single PAYE worker earning €33,000 in PAYE income per year will see an increase of c. €86 per annum or c. €7 per month in their take home pay.”

    For a more accurate reading based on your circumstances, please see the PwC tax calculator https://www.pwc.ie/2018-bud...

    GD asks a more general question, wondering what the income tax changes are?

    AOD: “If you are earning €33,800 or more, there is an increase of €750 in the income tax standard rate band (this means €750 is taxed at 20 per cent instead of 40 per cent).

    “If you are entitled to the home carer tax credit, you will see an increase of €100 to this credit. If you are self-employed or otherwise entitled to the earned income credit, there is an increase of €200. There has also been a reduction in USC rates.”

  • 09:12

    Back to property:

    “Did the government continue with the increase in mortgage interest relief that can be offset against rental income? They increased it from 75 per cent to 80 per cent last year. Did they go to 85 per cent for 2018?” SS.

    DC: “No they didn't. It had been expected that the Minister might accelerate mortgage relief for landlords but no mention was made of the issue at all in his speech.”

  • 09:16

    “Is the increase in stamp duty applicable in the event of selling house other than your Principal Private Residence?” CM.

    FR: “The increase in stamp duty relates to commercial property transactions. A residential property - even if let for commercial reasons - is liable to residential stamp duty of 1 per cent on properties valued up to €1 million, which didn't change.”

  • 09:19

    Our next question is from a single mother of a 16-year-old school-going child. She is on a disability allowance and currently pays €15 per month in prescription charges.

    “Disability allowance is to increase by €5 per week. Does the qualified child allowance increase by €2 for those on disability or is that increase only for lone parent and Family Income Supplement?” CO.

    DC: “The prescription charge for those on full medical cards has come down to €2 per item from €2.50 and the monthly limit from €25 to €20.

    “In relation to your disability allowance, there will be a €2 a week increase for a qualified child on top of the €5 a week increase in the allowance itself - both from the last week in March 2018.”

  • 09:23

    A motoring question now:

    “A 0 per cent benefit-in-kind (BIK) rate is being introduced for electric vehicles for a period of 1 year. Can someone please explain what this actually means? Is the BIK rate the rate at which the cash equivalent of the benefit is calculated? Also, what happens in year two?” BM.

    AOD: “Yes, normal BIK rules for company cars are based on a percentage of the original market value.

    “A 0 per cent rate for electric cars is being introduced for a period of one year for now, to allow for a comprehensive review of BIK on motor vehicles in general, which is likely to inform part of next year’s budgetary announcements.

    “Electricity used in the workplace for charging electric vehicles will also be exempt from BIK.”

  • 09:25

    “Were there no changes to inheritance tax, capital gains or dirt?” J.

    DC: “Strangely, despite the indications ahead of time that some or all might be tinkered with, no change was announced in any of those three areas. Keep an eye on next week's Finance Bill though.”

  • 09:30

    This reader wants to know about commercial property:

    “Is there a grace period for transactions that had commenced but not closed prior to introduction of stamp duty increase at midnight?” TH.

    AOD: “It is anticipated that a transition period will operate where the 2 per cent rate would still apply to contracts entered into before the budget date. However confirmation is still awaited on this - further details will be published in the upcoming Finance Bill.”

  • 09:34

    “Does a person with land that hasn't been handed over to his family, who now finds himself requiring long term home care, have to pay 7 per cent of the cost his estate towards his care, until he dies? Does that situation still stand after this budget?” MC.

    DC: “The issue of farm assets under the Fair Deal Nursing Homes Support Scheme was not addressed in the budget per se.

    “However, there is an ongoing discussion between the farm organisations and the agriculture minister. As of now, if your farm has not been handed over more than five years ago, it is taken into account is assessing your contribution to Fair Deal.

    “That states that 7.5 per cent of your assets go towards the cost of your care every year. The plan currently working its way through Government is to cap this contribution at three years. However, I don't think this is yet in place.”

  • 09:36

    More on income tax:

    “How much tax reduction will there be on a salary of €200,000?” D.

    FR: “A single earner on a salary of €200,000 will save €6 a week or €27 a month on the back of yesterday's income tax cuts. A married couple with one or two incomes on the same earnings will also save €6 a week.”

  • 09:41

    Another landlord wants to know whether there has there been a further increase in interest in mortgages tax relief? M.

    AOD: “From January 1st, 2017, you can deduct 80 per cent of the interest paid on your mortgage on a rental property. For earlier years, the figure is 75 per cent of the interest paid.”

  • 09:47

    “My husband is a public servant earning €45,000. I work part time earning €15,000. We are joint assessed, with one child under 1 one-year-of-age. How much will tax and USC benefit us? When will the changes kick in?!” S.


    AOD: “The new tax bands and reduced USC rates should give rise to an increase in your take home pay of c. €281 per annum or c. €23 per month. The new rates and bands take effect from 1st January 2018.”

  • 09:49

    On green measures, this reader wants to know “what changes are coming to encourage people to switch to electric or hybrid cars?” J.

    DC: “We don't know, and nor does the Minister, yet. He has announced a comprehensive review of benefit in kind (BIK) on vehicles at the same time as offering a one-year only 0 per cent BIK rate for electric vehicles and any workplace energy used to charge them.

    “It's likely that the next budget will see a more fundamental policy change in relation to electric vehicles. The Minister's problem, of course, is that any incentive to use electric vehicles runs the risk of eating into the cash the exchequer gets in excise on diesel and petrol.”

  • 09:54

    Sticking with the green theme:

    “I welcome the initiative on promoting electric/hybrid driving by reducing the benefit in kind (BIK) on company cars to 0 per cent.

    “Unfortunately in my case I opted for buying and running my own car instead of taking the company car option. Is there any further incentive for me to switch from diesel to electric/hybrid driving as I currently do 50,000km annually?” SmcG.

    DC: “The only change announced in the budget on electric vehicles was in relation to BIK. On this, the Minister announced a 0 per cent rate (and also said electricity used in the workplace to charge such vehicles was exempt from BIK).

    “However, this is only a holding measure. The 0 per cent rate applies only for one year, giving the Minister time for a ‘comprehensive review’ on BIK on vehicles ‘which will inform the next budget’.

    “There might well be further changes affecting electric vehicle owners in general as part of such a review.”

  • 09:56

    “Has there been any change in capital gains tax on the sale of development land?” BW.

    DC: “No change was announced in capital gains tax on the sale of development land. If sold for residential property purposes, it will be eligible for a refund on the new, higher commercial stamp duty rate introduced overnight.”

  • 09:59

    “I’m earning €46,000 with the HSE. What will the new tax bands do for me?” B.

    AOD: “The new tax bands and reduced USC rates will give rise to an increase in your take home pay of c. €268 per annum or c. €22 per month. This is based on a single PAYE worker earning €46,000 per year.”

  • 10:01

    “Was there anything for childcare? I've two little ones in crèche. Or, in the same vein, is child benefit gone up a fiver too?” B.

    FR: “The Early Childhood Care and Education scheme has been extended to two full years - ie up to 76 weeks from September 2018 from 61 weeks previously.

    “There was no increase in child benefit, which has been left at €140 a month per child. The Government is still committed to introducing an Affordable Childcare Scheme but the date is uncertain.”

  • 10:03

    “Was there any increase in the payment to old age pension dependent's payment?” CC.

    DC: “The maximum weekly rate for the State old age pension is increasing by €5 from late March 2018. If the dependent is 66, the increase for them is €4.50, so a total of €9.50. If the dependent is under 65, the total increase is €8.30.”

  • 10:04

    “When will shares listed on the Enterprise Securities Market become exempt from Stamp Duty?” JW.

    DC: “This was not a measure from this year's budget. Former minister for finance Michael Noonan announced that ESM share trading would be exempt from the 1 per cent stamp duty earlier this year. I gather the measure came into force on June 5th last.”

  • 10:07

    On property:

    “We have a signed contract to purchase a commercial warehouse. The closing date is the end of October. Will we have to obtain additional finance to pay 6 per cent stamp duty or will they honour the 2 per cent rate?” NP.

    DC: “That's unclear. In general, transition arrangements apply where tax changes are introduced that could affect transactions already in train.

    “However, the Minister has not given any details of such transition arrangements even though the new 6 per cent rate was voted in by the Dáil last night.

    “Best advice is to keep an eye on the Finance Bill being published on Thursday, October 19th. Any transition arrangements are likely to be outlined in that document.”

  • 10:10

    Our next reader has child who was born in October 2015 who currently can only have an Early Childhood Care and Education place from January 2019.

    “Can you tell me how does the extension to a ‘full two years’ benefit here?” M.

    FR: “Currently the Early Childhood Care and Education scheme is offered over 61 weeks - from September 2018 however it will be increased to 76 weeks, so this means that she may be eligible to start the scheme some 15 weeks earlier.”

  • 10:11

    “How much increase will a dependent adult receive in 2018?” JH.

    FR: “On the State pension, a qualified adult under the age of 80 will receive an increase of €3.30 a week, or €4.50 for those aged 80 and over. The invalidity pension will rise by €3.60, and jobseeker's by €3.30.”

  • 10:14

    Back to property:

    “Can you tell me more about the allowing of pre-letting expenses and what is the threshold?” JM.

    AOD: “Pre letting expenses of a revenue nature which have been incurred on a property that has been vacant for a period of 12 months or more can now be deducted against rental income.

    “A cap on allowable expenses of €5,000 per property will apply and the relief will be clawed back if the property is withdrawn from the rental market within four years. The relief is available for qualifying expenses incurred up to the end of 2021.

  • 10:18

    A reader describing themselves as a “distraught Irish Airlines Superannuation Scheme (IASS) deferred pensioner”:

    “The Minister for Transport and his party colleagues strongly denounced the last government for conniving with the IASS trustee and Aer Lingus/DAA to rob deferred pensioners of 60 per cent of their entitlements, but have conveniently ignored our plea for help since filling the very comfortable ministerial seats. Have they finally joined the fat cat political class?” EG.

    DC: “No measures relating specifically to the IASS pensioners emerged in the budget, nor were they likely to.”

  • 10:21

    Now we’ll take a social welfare question:

    “Was there any change for those of us on the Community Employment scheme/Tús?” GB

    DC: “People on the Community Employment and Tús schemes are also eligible for the €5 increase in weekly rates and, if on a reduced rate, they will receive a pro rata payment. It kicks in in the last week of March 2018.”

  • 10:23

    “I hold a medical card and, since I am over 70, I only pay €2 for a prescription. Has this changed?” COS.

    FR: “No. The Government cut prescription charges for those on medical cards under the age of 70 to €2.”

  • 10:25

    “Has there been a restoration to the dental benefit through the PRSI system?” J.

    FR: “There was no extension of the Dental Treatment Benefit Scheme in yesterday's budget.”

  • 10:27

    Back to property:

    “My husband works for a small private company and the owner is looking for a way to give him equity in the business. What do we know about the new Share Options scheme ‘KEEP’? Could this be applicable in his circumstances?” LC.

    DC: “There is, as yet, no detail on the KEEP (Key Employee Engagement Programme) but, from what the Minister said, it appears to be aimed at people like your husband and the company in which he works.

    “We'll just have to wait until the Finance Bill is published next Thursday to get a clearer idea of precisely how it will operate, and from when.”

  • 10:29

    “Do the changes to Capital Gains Tax Section 604A apply to individual properties or is it only to development land?” OD.

    DC: “From the limited information currently available, the changes to section 604 of the taxes Consolidation Act will apply to any property that qualified for the capital gains tax relief if held for seven years, having been purchased between December 7th, 2011 and the end of 2014.

    “The section does not differentiate between individual properties and development land. The change means holders of such properties can now sell them on once they have held on to them for four years and retain the relief.

    “Of course, they can continue to hold for seven years - or any period between four and seven years.”

  • 10:31

    “I have signed contract for the purchase of a site last week and the other party signed today. My question is, as they signed today, do I have to now pay 6 per cent stamp duty? If the person selling the site to me signed yesterday do I pay 2 per cent?” P.

    DC: Uncertainty over the commercial property stamp duty is the major theme of this morning's Q&A. We simply don't know and are trying to get clarity from the Minister.

    “Our assumption is that there will be some transition arrangement put in place to address circumstances like this, but whether that proves to be the case and precisely what they will be has yet to be clarified.”

  • 10:33

    On charities:

    “I understand that charities may claim a refund of VAT. From what date may it be claimed?” CM.

    FR: “The scheme will be introduced in 2019 in respect of VAT expenses incurred in 2018.”

  • 10:40

    “In relation to the increase in the stamp duty rate from two per cent to 6 per cent, what exactly is the definition of a commercial property?

    “Specifically, is a Chinese take away with an apartment overhead, or a pub or building used for offices and warehousing, subject to the 2 per cent or the 6 per cent stamp duty rate?” PF.

    DC: “As of now, all we really know is that the Dáil last night voted to confirm the new 6 per cent rate. We still have no confirmation of the details.

    “That is likely to come in the Finance Bill, published on Thursday week. However, it will not affect residential property, so buy-to-lets etc will not be affected. Offices? Likely yes. A retail outlet with accommodation overhead? Possibly. We just don't know yet.”

  • 10:43

    “Was there any change in my payslip regarding the taxes? Also, the consumer tax nowadays is so high at 23 per cent?” L.

    FR: “You should benefit from the reduction in the lower rate of USC to 2 per cent, and, depending on your earnings, you may also benefit from the increase in the standard rate band to €34,550. There was no change in Vat at 23 per cent.”

  • 10:50

    Our next question refers to a family of four with a six year old in school and four-year-old in crèche.

    “Was there anything of benefit to us? We’re both PAYE workers - private and public sector employees. We own our own home.” AF.

    FR: “Your four-year-old may or may not benefit from the extension in the Early Childhood Care and Education scheme, from September 2018, to 76 weeks.

    “You will also benefit from the reduction in the lower rate of USC to 2 per cent, and may also benefit from the increase in the standard rate band to €34,550. If you purchased your home between 2004-2012 you may also benefit from the extension of mortgage interest relief.

    “You can check out what it means to you on a weekly basis here:https://www.irishtimes.com/business/budget-2018/budget-calculator-2018”

  • 10:54

    Back to green cars, and this reader wants to know whether “the 0 per cent benefit in kind rate only for electric vehicles or will it apply to plug in hybrid?” AS.

    DC: “We'll have to await the detail in the Finance Bill - although the Department of Transport may clarify some of these issues later today. The Minister referenced only electric vehicles in his speech.”

  • 10:56

    “I am paid €19,500 per annum on an 11 month contract. How much USC a month will I be paying from now on?” M.

    FR: “You will be paying about €52 less in USC a year from January 2018.”

  • 11:02

    More on tax:

    “I work 40 hrs a week for an average yearly income of around €36,500. I’m married and pay USC and tax. Am I going to benefit anything going forward? I’m the only income in my house as husband doesn’t receive any social welfare. Also, has the threshold for doctor service card been increased?” KB

    FR: “Yes, you should get to keep an extra €4 a week or €16 a month thanks to a reduction in the lower rate of USC. You won't benefit in the increase in the standard rate threshold as you are already paying tax at 20 per cent on all your income.

    “If your husband claims the home carer credit however, you will also save a further €100 in tax due to an increase in this credit. There was no change to the threshold for a GP card.”

  • 11:04

    Does the VAT threshold remain unchanged at €37,500 p/a?” E.

    FR: “There was no change to the Vat threshold for the supply of services of €37,500 a year.”

  • 11:08

    We have some clarity on the stamp duty issue.

    Another reader wants to know: “When will the new 6 per cent rate apply? We are in the process of selling out commercial property and are at the sale agreed stage but subject to the budget stamp duty.” SL.

    DC: “That is unclear until we get the full details of the new arrangements in the Finance Bill, which will be published on Thursday of next week.

    “However, the Minister for Finance did confirm overnight that the Finance Bill will contain transitional arrangements "to cater for situations where binding contracts have been entered into, as has happened on previous occasions where stamp duty rates were changed".

  • 11:10

    “Any changes to the capital gains tax?” GS.

    BP: “The only CGT changes relate to the CGT seven year exemption, and a small change to CGT retirement relief relating to lands placed under solar infrastructure.

    “In relation to the CGT seven year exemption, the owners of qualifying assets can now sell those assets between the fourth and seventh anniversaries of their acquisition and enjoy full relief from CGT on any chargeable gains.”

  • 11:13

    Back to social welfare:

    “I'm on disability, with a wife and two dependent children. So, I get €403 a week currently. Will this improve or change in anyway?” CN.

    DC: “I'm a little thrown by the €403 figure. There may be something else in there. The maximum weekly payment for disability allowance for a person with a qualified adult is €321.10. That is rising to €329.40 from the last week of March 2018.

    “The allowance for a qualified child will increase from €29.80 to €31.80. So, where you would now receive €380.70 a week under these headings, you will get €393 a week from the end of March next year.”

  • 11:16

    On pensions:

    “Have the tax bands or credits for pensioners changed? And what about the 'Marginal Relief Test', is that to remain at 40 per cent on pensions exceeding €36,000?” MC.

    DC: “Pensioners saw no change in the exemption limit applying to them. So, a single pensioner will pay no tax if their income is below €18,000. For a couple, the figure is €36,000. Marginal relief is also unchanged.”

  • 11:19

    This reader’s son will be three in October 2018.

    “Does he benefit from the extended Early Childhood Care and Education scheme?" AmcA.

    FR: “Yes, the scheme will be extended to 76 weeks over two years starting in September 2018.”

  • 11:20

    “Is there any replacement grant for the disabled for the motorised transport grant which was closed in 2013?” HC.

    DC: “Nothing was announced in the budget on a replacement for the motorised transport grant. It may yet feature in the Finance Bill though I have heard nothing to that effect.”

  • 11:23

    “Is it possible that with the changes to income tax, etc, and the changes to tax relief at source, that my family will be poorer after this budget?” TH.

    AOD: “To understand the tax impact arising from the reduced USC rates and increased tax bands, please visit the PwC tax calculator https://www.pwc.ie/2018-bud... where you can enter your income details and calculate the difference to your net take home pay.

    “In relation to mortgage interest relief – 75 per cent of the existing 2017 relief will be continued into 2018, 50 per cent into 2019 and 25 per cent into 2020. The relief will then cease entirely from 2021.”

  • 11:24

    “Are job-seekers under 26 still only increased by €5 per week?” D.

    DC: “Young jobseekers on the reduced rate of welfare support will receive a €5 a week increase in their payment from the last week of March 2018. No additional measure to increase the payment was announced.”

  • 11:28

    “How does the increase in stamp duty on commercial property affect the transfer of a family farm from father to son who is over 35 years?” MK.

    BP: “In his speech, the Minister said he is maintaining consanguinity stamp duty relief at 1 per cent for inter family farm transfers for a further three years.

    “Further details should be in the forthcoming Finance Bill. Where the conditions of consanguinity relief are met, the rate of stamp duty applicable to lifetime farm transfers should be 1 per cent.

    “If the relief is not available then a lifetime transfer of the farm would attach stamp duty at 6 per cent (once the rate change on commercial property comes into effect).”

  • 11:30

    “Has there been any change in tax relief for retiring age over 66 if I sell my small business? It’s a partnership.” CC.

    BP: “There have been no changes to the tax reliefs on the sale of a business by an individual aged 66 or over.”

  • 11:32

    Our next question is from “a struggling crèche owner”.

    “What’s in the budget for childcare?” M.

    FR: “The capitation grant for Early Childhood Care and Education services will increase by 7 per cent in 2018. The scheme will also be extended to 76 weeks from September 2018, up from 61 weeks previously.”

  • 11:35

    On stamp duty:

    “Does the increase apply to agricultural land?” DM.

    BP: “The commercial rate of stamp duty generally applies to agricultural land and this rate has been increased from 2 per cent to 6 per cent in the budget.

    “However, certain reliefs and exemptions from stamp duty may apply to a lifetime transfer of farmland where certain conditions are met.

    “The Minister announced in the Budget that he is maintaining consanguinity stamp duty relief at 1 per cent for inter-family farm transfers for a further three years.

    “In addition, he announced that the exemption for young trained farmers from stamp duty on agricultural land transactions would continue. Further information on this should be in the forthcoming Finance Bill.”

  • 11:40

    “I live with my husband. Will we be entitled to the €2.50 weekly phone allowance?” AC.

    FR: “To qualify for this payment you must be living alone, and also qualify for the Living Alone Allowance.”

  • 11:45

    Another reader on an occupational pension of €28,069.59 per annum is paying €22.25 per month in the local property tax. “Is my gain approximately €66 per annum?” RS.

    AOD: “Assuming you don’t qualify for the reduced USC rates (i.e. you can avail of reduced rates if you are over 70 or you are a full medical card holder), you should see an annual saving of c. €74. If you do qualify for reduced USC rates, the annual saving is closer to €80.”

  • 11:53

    “I have both a state contributory pension of €12,417 per annum and a pension from Bord Failte of €18,517 before tax and USC. What difference will the budget make to me?” BF.

    BP: “Assuming you don’t qualify for the reduced rates of USC, then the net benefit to you of the tax cuts would be approximately €81 per annum.

    “If you do qualify for the reduced rates of USC, then the net benefit would be approximately €95 per annum. The reduced rates of USC apply to individuals over 70 or medical card holders.”

  • 11:56

    On social welfare:

    “Will those receiving the living alone payment but not also getting the fuel allowance get the weekly €2.50 telephone allowance?

    “In other words, must you already be in receipt of living alone and also fuel allowance to qualify for the weekly telephone allowance?” BG.

    DC: “Yes, you must be in receipt of BOTH the living alone allowance and the fuel allowance to qualify for the new Telephone Support Allowance.

    “The phone allowance was always part of the pensioners' household benefits package along with the fuel allowance until it was cut in 2014, so that's not particularly surprising.”

  • 11:58

    Why no increase in the inheritance tax threshold? This is the real stealth tax. At the time of the economic crash, a house worth €400,000 (threshold then €220,000) would have incurred a tax liability on an only child of about €60,000.

    “The same house today would be worth €600,000 and the same single child would now have a tax liability of €93,000, where the present threshold is only €320,000. Where is the fairness in that which Donohoe talks about?” DF

    FR: "Although the Government had previously committed to increasing the threshold on inheritance or capital acquisitions tax, currently levied at a rate of 33 per cent, from a parent to a child to €500,000, there was no announcement yesterday.

    “The reason may be due to the cost of such a measure - every 10 per cent increase in the threshold would have cost about €22 million. There may however, be an announcement in next week's Finance Bill.”

  • 12:00

    “Was there any change to the €2 million personal pension limit?” FB.

    AOD: “There has been no change to the standard fund threshold.”

  • 12:02

    “Were there any changes in the rate/ thresholds for Capital Gains Tax (CGT) for entrepreneurs on the sale of their 'founder' shares?” WB.

    BP: “There were no changes to CGT entrepreneur’s relief in the budget.”

  • 12:04

    Do all social welfare payments go up €5? P.

    FR: “The following payments will increase by €5 from March 26th, 2018: State Pension Contributory and Non-Contributory, Widow’s, Widower’s or Surviving Civil Partner’s and Disablement Pension.”

  • 12:07

    Our next question is from an expat currently living in Australia.

    “I’m curious to know if there were any good, bad or indifferent measures announced yesterday relevant to expats returning to Ireland?

    “I'm in Australia now and from what I understand, I'd be in for restrictions in access to loans; issues with the transfer of my driver's license; and laughable car insurance quotes, among other potential barriers.” OOC.

    FR: “There was nothing specifically aimed at returning expats in this year's budget, although, like everyone else, if you come back to work in Ireland in 2018 you will benefit from the lower tax rates announced in yesterday's budget.”

  • 12:10

    “In relation to stamp duty on commercial property, how exactly are they defining commercial property? I am currently in the process of purchasing eight acres to keep as farm land. What duty do I pay?” WN.

    DC: “The Government has yet to clarify what precisely it means by commercial property purchases.

    “They have indicated that residential property purchases - and even land purchased for residential property development - will not be included once certain conditions are satisfied. Where it leaves farm purchases will hopefully become clearer as the day progresses.”

  • 12:12

    “My parents signed over a house to me just over five years ago. It is not my principal residence. I had to pay the full 1 per cent stamp duty because of the change in the budget that year. Can I avail of the 5/7 year CGT exemption if I sell the house now?” JF.

    DC: “The section 604 measure covering capital gains tax relief on properties acquired between December 7th, 2011 and the end of 2014 relates only to property that was ‘acquired for a consideration equal to their market value’.

    “On the face of it, your parents signing over a property to you would not qualify even if you paid the stamp duty, unless you actually paid the market rate for the property.”

  • 12:16

    “I never knew you got a allowance for telephone calls or is this new? I’m 67.” MN.

    “There was a telephone allowance for pensions over the age of 70 up to 2014 when it was axed as part of the cutbacks imposed over several budgets. At the time, it was worth €9.50 a month.

    “The new Telephone Support Allowance, which will come into force with other welfare changes towards the end of next March, will see a payment of €2.50 a week made to people who are in receipt of the living alone allowance and the fuel allowance, which means you will have to wait a while as the fuel allowance still applies only over the age of 70.”

  • 12:25

    With that, we’re going to draw the Q&A to a close. Thanks for reading and hope our team of experts have helped with some of your queries.

    You can keep submitting questions here, and we’ll do our best to get back to many as possible.

    We will also have a wrap-up of the Q&A by Dominic Coyle, which will go live on irishtimes.com shortly.