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What will Budget '09 mean to you?

Following today's announcement of Budget 2009 we are sending an update to all our clients again this year to outline how the changes will affect you where it counts most: in your pocket.

This year's budget was labeled as being a tough but fair one, so we've laid out below the main changes we feel will be of interest to you.

If you have any queries about how the changes will affect you and your family please do not hesitate to contact us. One of our Qualified Financial Advisers will be happy to answer your queries in strictest confidence. 

Simply click one of the links above to email us or have us call you. We're also delighted to announce our new LiveAdvice service, which allows you to chat instantly with one of our qualified financial advisers from the comfort of your office or home.

Summary of changes, which take effect from 1st Jan 2009

Income Levy

  • A new income levy of 1% will apply to all incomes up to €100,000 (€1,925 per week) and 2% on incomes in excess of 100,100. This levy excludes social welfare payments, contributory and non-contributory pensions. 

New Standard Rate Bands (amount you pay at 20%)

  • Single: a proposed increase from €35,400 to €36,400
  • Married One Income: a proposed increase from €44,400 to €45,400
  • Married Two Incomes: a proposed increase from €70,800 to €72,800
  • With a maximum transferability between spouses of €44,400 in 2008 and €45,400 in 2009

Personal Tax Credits

  • No changes

PRSI

  • As from 1 January 2009, the PRSI contribution ceiling will increase from €50,700 to €52,000

Pensions

  • The annual earnings limit for determining maximum tax-relievable contributions for pension purposes is being set at €150,000 for 2009 as compared with the 2008 limit of €275,239.

DIRT on Life Assurance Policies and Investment Funds

  • The rates of retention tax that applies to deposit interest, together with the rates of tax that apply to (a) life assurance policies and (b) investment funds, are being increased by 3 percentage points to 23% and 26% respectively.

Mortgage Interest Relief

  • The current rate of mortgage interest relief is being increased from 1 January 2009 for first-time buyers from 20% to 25% in year 1 and year 2 and to 22.5% in years 3, 4 and 5. The additional relief will be available to new first-time buyers and first-time buyers who have bought a house in the last 4 years.
  • The rate of mortgage interest relief for non-first-time buyers is being reduced from 20% to 15% from 1 January 2009.

Health Expenses Relief

  • Health Expenses relief will be granted at the standard rate only (currently 20%)from 1 January 2009, with the exception of nursing home expenses which will be standard rated from 1 January 2010.
I hope you found this information useful. If you would like a no-obligation chat with one of our advisers please let us know. We would be delighted to hear from you.

Best regards,
Richard.
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Richard Fitzgerald QFA
Financial Planner & Tax Adviser

M: +353 (0)87 234 3434
T: +353 (0)1 852 7711 (direct)
T: 1850 88 24 24
F: +353 (0)1 443 0493
W: www.thewealthshop.com

The Wealth Shop Ltd, (t/a the wealth shop) is regulated by the Financial Regulator.

Registered office: Unit 236, First Floor
OmniPark S.C., Santry, Dublin 9.
Company number 419032.
Directors: R.Fitzgerald, L.Gallagher

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