Budget 2027 for Irish landlords: what changed, and the clawback to check before you sell

Read Budget 2027 from a landlord’s side and ask one question: what does it do for people who rent out property in Ireland? The honest answer is not much. There is no new relief on rental income, no change to how rental profit is taxed, and nothing on the landlord relief that ends next year.

There are three changes that do reach landlords, though, and one of them is bigger than it looks. Capital Gains Tax came down by 2 points the day after the Budget. For a landlord who has been thinking about selling, that changes the sums. It also sits right beside a clawback rule most people have never heard of.

This is what changed, what it is worth in euro, and what I would check before acting on any of it. The figures come from the Department of Finance’s Budget 2027 tax policy summary and Revenue’s own guidance. Budget measures only become law when the Finance (No. 2) Bill 2026 is passed, which the Government aims to do by the end of the year, so treat the 2027 figures as planned rather than settled.

Rental income: what did not change

Rental profit is still taxed as income, at 20% or 40% plus USC and PRSI. The deductions are the same as last year. Mortgage interest is still 100% deductible, but only if every tenancy in the property is registered with the RTB. Miss one and all the interest for that property is lost for the year, which catches more people than it should.

The Residential Premises Rental Income Relief, the one most landlords just call the landlord tax credit, is worth up to EUR 1,000 for 2026 and 2027. It is the lowest of EUR 1,000, 20% of the profit from qualifying property, or 20% of your total rental income. It reduces income tax only, not USC or PRSI.

The Budget did not extend it. As things stand, 2027 is the last year you can claim it. If you are a small landlord, that is the number I would plan around for 2028, not the band changes below.

The tax band and USC changes

The standard rate cut off point goes up by EUR 2,500, so a single person pays 20% on the first EUR 46,500 instead of EUR 44,000. The ceiling on the 2% USC band rises by EUR 1,600. The personal tax credit goes up by EUR 125.

For a landlord whose rental profit sits on top of a salary and is taxed at 40%, the wider band moves EUR 2,500 from 40% to 20%. That is EUR 500 a year. The USC change adds about EUR 16 at 3% minus 2%. Call it EUR 516, plus the EUR 125 credit everyone gets.

These apply from 1 January 2027. The return you file in October 2027 covers the 2026 tax year, so it still uses 2026 rates. Our rental income tax calculator has both years, so you can run the same figures under 2026 and 2027 rates side by side.

Capital Gains Tax down to 31%

The standard rate of CGT drops from 33% to 31% for disposals made on or after 7 October 2026. Gains on development land stay at 33%. The change goes through in the Finance Bill, so the final wording is still to come, but the rate and date were set on Budget night.

On a EUR 100,000 gain, 2 points is EUR 2,000. On a property bought in 2015 and sold now, gains of that size are common. It is a real saving, and I expect it to tip some small landlords who were already on the fence about leaving the market.

Before anyone rings an estate agent, there are two other things to check. The first is whether you can end the tenancy at all, which depends on when it began and how many tenancies you have. The second is below.

The clawback to check before you sell

Revenue claws back the landlord relief if, within four years of the first year you claimed it, you stop being a landlord of a property you claimed it on. Selling counts. So does switching to short-term letting, or letting to a relative.

Revenue’s own worked example is a landlord who claimed the relief for 2024, 2025 and 2026 and sells in 2027. All three years are clawed back. At the maximum, that is EUR 600, EUR 800 and EUR 1,000, so EUR 2,400 of tax handed back.

Set that against the CGT saving. On a small gain the clawback can wipe out the cut entirely. On a large gain the cut still wins, but the gap is narrower than the headline suggests. The relief is not clawed back while the property is actively marketed for rent, or if the landlord dies.

Rent a room and the rent tax credit

Rent a room relief rises from EUR 14,000 to EUR 16,000 from 1 January 2027. It also extends to certain garden units, which the Budget calls designated auxiliary dwellings, built after 27 July 2026. This is for homeowners renting space in or beside their own home, not for landlords of separate properties.

The rent tax credit goes up by EUR 150 for a single person and EUR 300 for a couple. That is the tenant’s credit, not yours. It is worth knowing because tenants ask, and a registered tenancy is what lets them claim it.

How we handle this in Rentalize

Most of the tax work a landlord does is really record keeping. Rent received, expenses, the dates a tenancy was registered. Rentalize 360 keeps all of that in one place for landlords with 1 to 50 units, and gives you an annual profit and loss to hand to your accountant.

For property management companies, Rentalize Core tracks RTB registration and renewal dates across every tenancy, with a one-click RTB registration export that you then file on rtb.ie. Missing a registration costs the landlord the mortgage interest deduction for that period, which is a more expensive mistake than anything in this Budget.

If you would like to see how that works on your own portfolio, you can book a 20-minute walkthrough or look at pricing first.

Questions

Did Budget 2027 change how rental income is taxed in Ireland?

No. Rental profit is still taxed at your marginal rate plus USC and PRSI, with the same deductions. The wider standard rate band and USC band from 1 January 2027 reduce the tax on it slightly for higher-rate taxpayers.

Is the landlord tax credit being extended past 2027?

Not in Budget 2027. The Residential Premises Rental Income Relief is worth up to EUR 1,000 for 2026 and 2027, and nothing in the Budget extends it beyond that.

When does the 31% CGT rate apply from?

To disposals made on or after 7 October 2026. Development land stays at 33%. The change is implemented through the Finance Bill.

If I sell my rental property in 2027, do I lose the landlord relief?

You can. If you sell within four years of the first year you claimed it, Revenue claws back the relief for every year you claimed. A landlord who claimed for 2024 to 2026 and sells in 2027 repays all three years.

Does the higher rent tax credit help landlords?

Not directly. It is claimed by tenants, and they can only claim it on a tenancy registered with the RTB. It goes up by EUR 150 for a single person and EUR 300 for a couple.

Sources: Department of Finance, Budget 2027 Tax Policy Changes Summary. Revenue Tax and Duty Manual Part 15-03-04 (Residential Premises Rental Income Relief). This is general information, not tax advice. Check your own position with your accountant.

Photo: Evening at Government Buildings, Merrion Square by David Kernan, licensed CC BY 4.0, via Wikimedia Commons.