Budget 2021 – Main Headline Items for horticulture
Teagasc financial management specialist Kevin Connolly summaries some key points from the recent budget.
- The income tax standard rate bands and income tax rates (20% & 40%) have not been changed
- The Earned Income Tax Credit has been increased by €150 to €1,650.
- Statutory minimum wage is to increase by 10 cent from its current rate of €10.10 per hour to €10.20 per hour from 1st January 2021
- The Dependent Relative Tax Credit has been increased from €70 to €245
- There has been a minor change made to one USC band
- There is no change in the Capital Gains Tax (CGT), Capital Acquisitions Tax (CAT) and Stamp Duty rates.
- Farm Consolidation Relief from Stamp Duty has been extended until 31st December 2022
- Stamp Duty Consanguinity Relief has been extended for an additional three years until 31st December 2023.
- The VAT flat rate farmer addition rate is to increase from 5.4% to 5.6% from 1st January 2021
- The standard rate of VAT was cut from 23% to 21% from September 2020 until the end of February 2021. The lower rate of 13.5% remains unchanged with the exception of the hospitality sector.
- There are no changes to the main general Social Protection Payments for 2020 but there have been some increases to the qualified child additions and living alone allowances.
- Changes have been made to Carbon Taxes has increase by €7.50 from €26 per tonne to €33.50 per tonne from 14th October. This will mean an approximate increase of 2 cent per litre of petrol or 2.45 cent per litre of diesel.
- A Recovery Fund has been established to ensure continued support for the economy in the event of a no-deal Brexit.
- Funding of €9 million has been allocated for grant in aid for Horticulture