Massive Tax Cuts For Parents Announced

Families with children are set to benefit from a new tax cut worth €160 million, to be introduced over three Budgets.

The measure is designed to ease financial pressures on working parents and support families raising children. It will apply to married couples and parents with children under 18, or up to 23 if they remain in full-time education.

Two new tax computation categories will be created: one for families with a single child and another for those with two or more children.

Married couples with one child will see their tax-free income threshold rise from €15,000 to €22,500 over three years.

Around 2,400 families are expected to benefit, saving an estimated €2,175 by the end of the third year. Over a period of 23 years, combining last year’s tax cut with the new measures, families in this bracket will have their tax burden reduced by up to €65,000.

Parents with one child will have their non-taxable income increase from €13,000 to €18,000, benefiting approximately 23,750 parents and saving up to €3,600 each.

Over 23 years, this means their tax burden will be reduced by just under €113,000.

Larger families will receive the most substantial relief. Married couples with two or more children will see their tax-free threshold rise from €15,000 to €37,000, saving up to €6,000 annually.

Parents with two or more children will have their threshold rise from €13,000 to €30,000, potentially saving €10,000 per year.

Over 25 years, married couples in this bracket could reduce their tax burden by over €150,000, while parents with both working could save up to €257,000.

By the end of the three-year rollout, €160 million will remain in families’ pockets.

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