Finance Minister Paschal Donohoe has suggested the popular rent tax credit may continue beyond its scheduled end-of-year expiry, emphasizing its importance in supporting tenants with rising rental costs.
Speaking to reporters, Donohoe remained deliberately vague about specific Budget 2026 measures but highlighted his “recognition of the importance of that credit” and its role in reducing tenant bills. The measure currently allows renters to claim up to €1,000 annually and has been available for the past two years.
Originally introduced in 2022 at €500, the credit was doubled to €1,000 and backdated for those who hadn’t claimed the initial amount. The tax relief has provided significant support to renters facing escalating accommodation costs across the country.
“I am well aware of the importance of the rent tax credit and the really valuable role that it has played in supporting tenants with rising rents,” Donohoe said. “The rent tax credit is due to come to an end at the end of this year and while no decisions have yet been made on any tax measure, I just emphasise my recognition of the importance of that credit and the role that it plays in supporting tenants.”
The minister’s comments come as Budget 2026 preparations intensify ahead of the October 7 announcement. This year’s package totals €9.4 billion, including €1.5 billion in tax cuts and a €7.9 billion spending increase of 7.3% for next year.
However, expectations for this year’s budget are being tempered compared to last year’s pre-election measures, which some critics described as excessive. The Government has emphasized economic uncertainties, including potential 15% US tariffs that could impact Ireland’s export-dependent economy.
Despite these concerns, Taoiseach Micheál Martin indicated this week that budget figures are unlikely to change significantly, even though current projections assume no US tariff impacts.
The rent tax credit’s potential extension would provide welcome relief to tenants struggling with accommodation costs that continue to rise across most of the country. With rental prices remaining elevated despite recent policy interventions, the credit has become a crucial support mechanism for many renters.
The final decision on the credit’s future will be revealed alongside other tax and spending measures when Minister Donohoe delivers Budget 2026 in just over two weeks.