2026 is almost here, which means it’s time to get a head start on understanding your new tax obligations as an expat. The Irish Budget, announced back in October, means that Irish tax legislation will change when the new Budget is signed into law. This usually happens in late December or early January.
We’ll break down the current rules and what’s changing, so newcomers can get a clear understanding of how things work. And for expats who’ve already settled in, you’ll know what to keep an eye on as the new rules come into play.
Tax Changes to Be Aware of in 2026
The 2026 tax year is bringing a few updates that could affect your taxes as an expat living and working in Ireland.
Universal Social Charge (USC) Changes
This extra tax we all pay on our employment income (separate from regular income tax) is getting a few tweaks in 2026.
Right now, it’s charged in bands at different percentage rates: the more taxable income you have, the higher the USC rate you owe.
What’s Changing
Starting 1 January 2026, the ceiling for the 2% USC band will rise from €27,382 to €28,700.
In simple terms, a slightly bigger slice of your income will now be taxed at the lower 2% rate before moving up to the higher ones. It’s not life-changing money, but it does mean you’ll keep a little more in your pocket.
Special Assignee Relief Programme (SARP)
If you’re moving to Ireland for work with a multinational company, you might come across something called SARP. It’s basically a tax break designed to attract (and keep) highly skilled professionals who are sent to work in Ireland from abroad.
If you qualify, part of your income is exempt from Irish income tax – usually 30% of your earnings between (currently) €100,000 and €1 million. In other words, you only pay tax on the rest, which helps lower your overall tax bill.
To qualify, you generally need to:
- Be assigned to work in Ireland by your overseas employer for at least 12 months
- Have worked for that overseas employer for at least six months outside Ireland immediately before arrival.
- Earn at least €100,000 a year (not counting bonuses or benefits)
- Not have been an Irish tax resident for the five tax years immediately before your arrival.
Note: Your employer must ensure they comply with specific obligations to request SARP on your behalf.
What’s Changing
Before the budget announcements back in October, SARP was set to wrap up in the next few years. Instead, the government has extended it through 31 December 2030.
The minimum qualifying income is also increasing from €100,000 to €125,000 starting 1 January 2026.
Whether you’re moving to Ireland or already working here, that’s good news for high-earning professionals who qualify.
The extension also gives international employers more confidence when relocating key staff, keeping Ireland high on the list for global business operations.
Pay Related Social Insurance (PRSI) and Pensions
If you’ve been working in Ireland as an expat for a while, you’ll already be familiar with Pay Related Social Insurance (PRSI). But if you’re planning your move, it’s one of the key things to get to know early on.
PRSI is the contribution that you (and your employer) make to fund things like social welfare benefits, maternity and paternity leave, illness payments, and eventually your State Pension.
Prior to 1 October 2025, most employees paid 4.1%, while employers paid 11.15% in PRSI.
On top of that, many people also contribute to a private or workplace pension, which helps raise their retirement income beyond the State Pension.
What’s Changing
Since 1 October 2025, PRSI rates have started to increase based on new mandates. Employees are now paying 4.20%, while employers contribute 11.25%. And there’s another bump on the way – from 1 October 2026, those rates will rise again to 4.35% for employees and 11.40% for employers.
But that’s not the only update around the corner. Starting in January 2026, Ireland’s new Auto-Enrolment Retirement Savings Scheme will officially launch, helping more workers build up pension savings automatically.
If you’re aged 23 to 60 and earn €20,000 or more a year, and you don’t already have a workplace pension, you’ll be automatically enrolled. Contributions will look like this:
- Employee: 1.5% of your salary
- Employer: 1.5% (matched)
- Government: adds an extra 0.5%
Your take-home pay will go down slightly, but it means you’ll start building up pension savings straight away – with your employer and the government pitching in, too. You cannot pay more or less than the set rate.
If you earn less than €20,000, or you’re outside the 23-60 age range, you won’t be automatically enrolled, but you can choose to join if you’d like.
Investment Tax (Exit Tax)
If you have money invested in certain Irish investment funds, offshore funds, or life assurance products, you’ll probably come across something called the Exit Tax or ‘offshore fund’ regime. It’s the tax you pay on ‘rolled-up’ profits/gains earned from these kinds of investments. Basically, it’s Ireland’s version of a capital gains tax for certain types of investment funds.
What’s Changing
From 2026, the Exit Tax rate is being reduced from 41% to 38%.
For expats (or anyone holding or planning to invest in these products!), this 3% drop is a welcome move. It might not sound huge, but over time it can add up on your after-tax returns, especially for long-term investors.
Renters’ Tax Credit
This handy relief, sometimes called the Rent Tax Credit, gives tenants some money back at tax time. You can claim it if you’re renting your main home, or if you’re a parent paying rent for a child who’s in college and living away from home.
The credit is worth up to €1,000 per year for single people and €2,000 for jointly assessed couples, and it can be used to reduce the amount of income tax you owe.
How can you claim it? Simply submit the details of your tenancy and rent payments via Revenue’s myAccount service. Alternatively a claim for the credit can be made via your year end tax return (Form 11).
What’s Changing
Nothing with the Renters’ Tax Credit is changing exactly – but it has been extended until the end of 2028. So, if you’re a tenant in Ireland, you can continue to claim it for the next few years.
Foreign Earnings Deduction (FED)
If you’re based in Ireland but spend time working abroad, the Foreign Earnings Deduction (FED) is a good one to know about. It’s a tax break that lets you claim an income tax deduction on part of your overseas or foreign income, reducing the amount of Irish tax you pay.
It basically rewards you for those stints working outside the country, where your work in that location is required for your role.
To qualify, you’ll need to spend a certain number of days each year working in specific qualifying countries. It’s especially handy for professionals in international roles who travel regularly for work.
What’s Changing
Great news! The FED has been extended until the end of 2030, and the income cap is going up from €35,000 to €50,000. Even better, a few more countries have been added to the list – including the Philippines and Turkey.
What’s Staying the Same in 2026
Not everything is changing! Many key parts of Ireland’s tax system are staying put for now. Here’s what remains steady heading into 2026:
Tax Residency Rules
The residency tests – based on the number of days you spend in Ireland – are staying the same. You’ll still be considered and Irish tax-resident if you’re in Ireland for:
- 183 days or more in a single tax year, or
- 280 days or more over two consecutive years (with at least 30 days in each).
This means there are no new residency rules for expats to worry about in 2026.
Income Tax Rates
In Ireland, your income is taxed at two main rates:
- 20% (the standard rate)
- 40% (the higher rate)
There are no changes to the 20% and 40% income tax bands or to most personal tax credits in 2026.
How much of your income falls into each band depends on how much you earn and whether you’re single, married, or a parent. You can see a breakdown of each rate band here.
On the plus side, you’re likely entitled to a few tax credits that can take the sting out of your bill. These include the Personal Tax Credit (which everyone gets) and the Pay As You Earn (PAYE) credit (which applies if your tax is automatically deducted from your wages).
Capital Gains Tax (CGT)
The CGT rate – applied to recipients of gifts or inheritances – is holding steady at 33% for 2026. This tax kicks in when you receive money, property, or other assets as a gift or inheritance, and it’s based on the value of what you receive (as determined by the tax legislation).
You don’t pay tax on everything you receive by way of gift or inheritance, though! There are group thresholds that decide how much you can receive tax-free, depending on your relationship to the person giving or leaving you the asset.
Double Taxation Agreements (DTAs)
A big concern for many expats is getting taxed twice on the same income – once in Ireland and again in their home country.
Thankfully, Ireland has an extensive network of 70+ Double Taxation Agreements (DTAs) that protect expats from being double taxed. These treaties lay out which country has the right to tax your income depending on factors like your residency status, where you work, and where your income comes from.
None of this is changing for 2026.
For Irish tax residents – who’re usually taxed on their worldwide income – the relevant Double Taxation Agreement helps make sure the same income isn’t taxed twice, both in Ireland and abroad.
If you live or work between Ireland and another treaty country, the DTA lets you claim tax credits, reliefs, or exemptions, so you’re only taxed once and stay protected under international tax rules.
Corporation Tax
Ireland’s well-known 12.5% corporation tax rate on trading income isn’t going anywhere. As one of the lowest in the EU, this rate continues to be a big draw for global companies setting up in Europe.
For large multinational businesses (with global revenues above €750 million), the 15% minimum corporate tax rate under the OECD’s global tax agreement still applies. This ensures Ireland continues to align with international standards.
No further changes to the Irish corporate tax rate have been announced for 2026, so both local and international companies can expect stability in this area.
Expat Taxes Is Here to Help
Keeping up with tax changes is complex, especially when you’re living abroad.
Our expat tax professionals help you make sense of the new rules and figure out what applies to you – with no complicated jargon.
Planning your move or just got here? We’ll help you check your tax residency, review your income, property, and investments, and explain how Irish taxes – like income tax and CGT– work for you.
We can also look at Double Taxation Agreements (DTAs) and other ways to make your money go further so you don’t end up paying more tax than you have to.
If you’d like a hand getting your taxes in order – or just want to know where you stand for 2026 – we’ll help you sort it. Book a consultation today or drop a quick message to info@expattaxes.ie to learn more about how we can help.
Disclaimer:
The material in this article is for general information purposes only and does not constitute legal or taxation advice. Legal, financial, investment and taxation advice should be sought before acting or refraining from acting. All information and taxation rules are subject to change without notice. Expat Taxes Limited accepts no liability for any action taken based on the information in this article or any of the articles in our blog series.
Written by Bryan Wickham, FCA
Having worked in both Ireland and Australia, Bryan brings over 15 years of cross-border experience in tax and accounting to the team. As the head of Expat Taxes’ compliance function, Bryan tackles everything from non-resident landlord tax issues to sole trader compliance — with expertise in niche tax scenarios even industry professionals struggle to understand.
