What to know from Budget 2024

This afternoon Ministers Michael McGrath and Paschal Donohoe announced the details for Budget 2024. While this budget acknowledged the changing economic climate it did not go far enough in tackling rising business costs for small firms and ensuring you and your business can remain competitive and stay ahead in a rapidly evolving business environment.

Changes of note:

• Scheme of business supports worth €250 million, to recognise the rising cost of doing business.
• EII -standardising the investment period to four years for all investments and doubling the amount an investor can claim relief on for four-year investments to €500,000.
• An Increase in the R&D Tax Credit from 25% to 30% and doubling the first-year payment threshold from €25,000 to €50,000.
• Earned Income Tax Credit to increase by €100.
• Entrepreneurs Relief extended to angel investors.
• National Minimum Wage increasing to €12.70 per hour from January 2024.
• Nine million euro allocated to Local Enterprise Offices to allow them to extend their financial supports and mentoring programmes to a wider cohort of indigenous businesses.
• Increasing the standard rate income tax cut off point of €2,000 to bring entry to the higher rate of income tax to €42,000.
• Reducing the 4.5% rate of USC to 4%.
• The upper age limit for Retirement Relief has been extended from 65 until the age of 70. The reduced relief which was available on disposals from age 66 onwards will now apply from age 70.

As of this evening, we understand that the €250m fund to assist firms with rising costs of doing business will be called the ‘Increased Cost of Business Scheme’ and will offer once-off grants to small and medium sized firms. The payments will come in the form of tiered grants equivalent to up to 50% of the commercial rates paid by the firms this year. Payments will be made early in 2024. On your behalf, the Association will seek further details on this scheme and update you shortly with more information.

SFA sought many of the above changes in particular measures to support rising business costs, modifications of the tax code to sustain investment, reductions in taxes on jobs and continued funding for the LEO network to support grants and mentoring. The Association will continue to monitor these changes and the introduction of the new supports which will be confirmed in the Finance Bill.

You can read the SFA response here and more SFA Pre- Budget 2024 submission here.