Budget 2026 introduces several key measures impacting medical professionals in Ireland, particularly locum doctors, consultants, GPs, and private practice owners. Below is a comprehensive overview of the most pertinent changes:
There were no significant changes to the main income tax bands or personal tax credits in Budget 2026. This means that while nominal rates remain the same, many professionals may experience "bracket creep," where pay rises push income into higher effective tax rates.
The threshold for the 2% USC rate has been increased slightly, providing modest relief for middle-income earners. Additionally, the reduced USC rates for medical card holders have been extended until the end of 2027.
The employee PRSI rate has increased slightly to 4.2% in 2026. Further incremental increases are planned later in the year for both employees and employers. Self-employed locums and practice owners will see corresponding changes.
Mortgage Interest Relief has been extended until the end of 2026, though the level of relief has been reduced. The Renter’s Tax Credit continues through 2028. The exit tax on certain investment structures has been reduced from 41% to 38%. The lifetime limit for Entrepreneur Relief has risen from €1 million to €1.5 million, offering opportunities for business owners considering restructuring or future sales.
The Research & Development tax credit has increased from 30% to 35%, with a higher first-year claim threshold. This is especially relevant for clinics or practitioners involved in digital health, clinical trials, or telemedicine innovation.
Rules around dividend income and qualifying subsidiaries have been simplified, supporting healthcare practices with corporate structures or cross-border arrangements.
VAT on hospitality-related services has been reduced from 13.5% to 9% from mid-2026. While primarily aimed at hospitality, this could indirectly benefit healthcare facilities with in-house cafés or service amenities.
Tax-efficient share option schemes (KEEP) and international assignment reliefs (SARP) have been extended, providing ongoing support for practices that use incentive-based remuneration.
Additional funding and supports for small and medium businesses continue, alongside reforms to simplify interest deductibility, which is positive for practice owners managing business loans or property investments.
Budget 2026 maintains the government’s focus on sustainability and infrastructure development.
For locums or consultants who travel frequently, these measures will influence transport costs and vehicle policy decisions.
While many of these are broad measures, they shape the wider economic environment and cost-of-living landscape for healthcare professionals and their staff.
We’ve provided you with the most relevant aspects of Budget 2025. You’ll find additional details from the following trusted sources:
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