Budget Explainer rent a room increased from 14 to 16k

Overall housing measures


Chapter 3
Supporting the Housing Market



3.1 Rent Tax Credit

The Rent Tax Credit is being increased by €150 to €1,150 for a single claimant, or €300 to €2,300 in the case of a jointly assessed couple. The increased value applies to the 2027 and 2028 tax years.

3.2 Rent a Room

The Rent a Room rental income ceiling is being increased from €14,000 to €16,000 from 1 January
2027.

Rent a Room Income Tax Relief is also extended to certain Designated Auxiliary Dwellings installed after 27 July 2026 and which are consistent with the 2026 Planning Regulations on such structures (exempted dwellings under S.I. 340 of 2026).

A single Rent a Room rental income ceiling of €16,000 from all Rent a Room income applies per taxpayer unit.

3.3 Help to Buy

The current level of support available to first time buyers under the Help to Buy scheme, is whichever is the lesser of:

• €30,000; or
• 10% of the purchase price of the new property; or
• the amount of Income Tax and DIRT paid in the four years before the application.

The maximum relief available under the Help to Buy scheme is being increased by €5,000 from
€30,000 to €35,000. The other parameters remain unchanged. The change take effect from 7 October
2026.

3.4 Residential Zoned Land Tax

Finance (No. 2) Bill 2026 will provide for a further opportunity for Residential Zoned Land Tax (RZLT) landowners to make a submission requesting a change in zoning of land appearing on the revised map for 2027, and, in certain circumstances, being exempted from RZLT for 2027 on foot of such submissions.

3.5 Derelict Property Tax

Finance (No. 2) Bill 2026 will introduce a new Derelict Property Tax to support housing supply and regeneration. Further information is provided in Chapter 7.
 
I don't understand that purpose of the Rent A Room increase - beyond rents going up. It certainly won't improve the situation for anyone trying to rent. (And maybe more sheds popping up in people's back gardens, which now will be 16K a year to rent)
 
Was there any word on LPT treatment for "second dwelling" in back garden? Revenue were previously adamant it required separate LPT registration. Which could then trigger Vacant Home Tax in some cases?
 
newirishman said:
don't understand that purpose of the Rent A Room increase - beyond rents going up.
Click to expand...
Well in my case it allows me to rent out my second room on digs bases and not go over the threshold, so keep the rent a reasonable price and open up more rooms in homes perhaps?
 
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