Ireland has cut its main rate of capital gains tax. Since 7 October 2026, gains on most disposals are taxed at 31% instead of 33%. The change was announced in the Budget on 6 October and put into legislative form on 19 October 2026, when the government published the Finance (No. 2) Bill 2026.
The same bill lowers the tax on Irish and equivalent foreign funds from 38% to 35% from January, keeps the eight-year "deemed disposal" rule, and creates a new tax-favoured investment account that opens in July 2027. For people deciding whether to move to Ireland, or planning to leave it, each of these changes works differently depending on where they are tax resident when a gain arises.
What Changed on 7 October
Section 36 of the bill does one thing: it replaces "33 per cent" with "31 per cent" in the section of the Taxes Consolidation Act that sets the rate, for disposals made on or after 7 October 2026. A sale on 6 October was taxed at 33%; a sale a day later at 31%.
In his Budget statement, Minister for Finance Simon Harris gave the reason: "To encourage such entrepreneurship, to reward risk, and facilitate the scaling of home-grown Irish firms, we are reducing the standard rate of capital gains tax from 33% to 31%."
It is the first reduction in Revenue's published table of historic rates, which shows only increases from 20% in 2008 to 33%. Revenue's guidance already reflects the change. Its rate table now shows:
| Type of gain | Rate |
|---|---|
| Most gains | 31% |
| Development land | 33% |
| Foreign life policies and foreign investment products | 40% |
| Venture capital funds (individuals and partnerships) | 15% |
The personal exemption stays at €1,270 of gains per person per year, available to residents and non-residents alike. The payment rhythm is also unchanged: for disposals between 1 January and 30 November, the tax is due by 15 December of the same year; for December disposals, by 31 January. The return is due by 31 October of the following year, according to Revenue.
The cut is real but modest. On a gain of €200,000, it saves €4,000. It also leaves Ireland with one of the higher capital gains rates in Western Europe, a point the Brief made in its honest assessment of Ireland as a tax base. The 31% rate remains among the reasons Ireland does not appear on the Brief's list of countries with no capital gains tax.
Funds: 35% From January, Deemed Disposal Stays
Many investors in Ireland do not pay capital gains tax on their funds at all, because Irish-domiciled funds and their equivalents abroad fall under a separate regime. Gains are taxed at a flat rate, and units are treated as sold every eight years even if the investor keeps them. That is the deemed disposal rule.
The bill cuts the rate for individuals in those funds, and in Irish and certain foreign life assurance products, from 38% to 35% with effect from 1 January 2027. It does so by substituting "35 per cent" for "38 per cent" across the relevant sections. The Minister told the Dáil the work is not finished: "We will now intensively continue the work on the wider regime, including the rate of taxation, deemed disposal and the administrative burden facing investors."
The bill also adds a new chapter for what it calls relevant fund units, which the Minister linked to giving "clarity regarding how tax on investments such as ETFs operates". The new rules keep the logic of the old ones: individuals are taxed at 35% on gains when units are sold or redeemed, and at the end of each eight-year period from acquisition. Two features matter to people who move:
Losses do not count. Where the calculation produces a loss, the gain is treated as nil and no loss is allowed.
Non-residents are outside it. No gain arises on an event if, immediately before it, the holder is an individual who is neither resident nor ordinarily resident in Ireland.
For anyone holding funds through an eight-year cycle, the residence status on the day the period ends can therefore decide whether there is a tax charge at all.
The New Investment Account: A Resident's Product
The most talked-about part of the package is the individual investment account, set out in a new Part 27A of the bill. According to the Budget statement, it "will open on 1 July 2027", and inside it "there will be no capital gains tax, dividend withholding tax, investment undertaking tax nor life assurance exit tax. The deemed disposal rule will not apply to investments held within the account." The bill itself leaves the start date to a ministerial order.
What the bill sets out:
| Feature | Rule in the bill |
|---|---|
| Who can open one | Individuals aged 18 or over, resident in the State, with a PPS number |
| Annual contribution limit | €12,000 |
| How it is taxed | "Investment account tax" of 1% a year on the average account value above €50,000 |
| Who pays | The provider calculates, deducts and pays it to Revenue |
For international movers, the decisive provision is section 747M, headed "Change of residence of qualifying individual". An account holder who leaves Ireland must notify the provider, and no contributions may be made during a period of non-residence. The provider must stop accepting them within 30 days of learning about the move, and contributions made after that point are returned. The account can stay open, and contributions can resume after the holder comes back to live in Ireland.
Put simply: the account is built for people who live in Ireland. A newcomer can open one once resident; someone who leaves keeps what is inside but cannot keep building it.
If You Are Moving to Ireland
Capital gains tax follows residence. Under section 29 of the Taxes Consolidation Act, a person who is resident or ordinarily resident in Ireland in a tax year is chargeable on gains made in that year, subject to the exceptions in the Acts. One of those exceptions has long mattered to arrivals: an individual who is not domiciled in Ireland is taxed on gains from assets outside Ireland and the United Kingdom only on the amounts brought into Ireland.
Three practical points follow for newcomers:
Know your cost base before you arrive. Gains made while resident are measured from what you paid. Purchase records for every holding you bring will be needed when you sell.
Check how your existing funds are classified. Revenue's rate table shows 40% for gains from foreign life policies and foreign investment products, against 31% for most gains and 35% for funds in the Irish-style regime from 2027. The label your new home applies to a fund you already own can matter more than the headline cut.
Plan the investment account into your timeline. Eligibility depends on being resident when the account is opened, and the account is not expected before July 2027.
If You Are Leaving Ireland
For people on the way out, residence works the other way. Revenue's guidance on non-resident individuals says that a non-resident pays Irish capital gains tax on gains from Irish land, buildings and minerals, certain exploration rights, and unquoted shares that derive most of their value from those assets or from assets used in an Irish trade.
The catch is ordinary residence. Revenue explains that a person who has been resident for three consecutive tax years becomes ordinarily resident and, after leaving, stays ordinarily resident for three more tax years. Because section 29 charges people who are resident or ordinarily resident, a long-term resident who leaves does not drop out of the Irish capital gains tax net on the day of departure. Whether a tax treaty with the new country of residence changes the result is a separate question for each case.
That makes timing a planning tool, and a trap. A sale made in the first years abroad can still fall within Irish capital gains tax, now at 31%, with the new country possibly taxing it too. The Brief's guide to the tax on leaving explains how other countries tie their tax to the moment of departure, and why Ireland's link through ordinary residence works differently from a formal exit tax.
Records are what make any of this provable. Dates of departure, days present and the date residence ended are the facts a tax office will ask for later, which is why the Brief's piece on the paper trail that saves you matters most in the year of a move.
What Else the Bill Changes
Several other measures affect households on both sides of a move:
Income tax bands from 2027. The standard-rate band for a single person rises to €46,500, with higher bands for some other household types.
Gift and inheritance tax thresholds. For gifts and inheritances taken on or after 7 October 2026, the tax-free thresholds rise to €420,000 (Group A, mainly children), €44,000 (Group B) and €22,000 (Group C).
For people weighing Ireland as a long-term home, the tax rules sit alongside the residence and citizenship rules, which are also moving. The Brief covered the government's plan for eight years of residence before citizenship in September.
Where the Bill Stands
The Finance (No. 2) Bill 2026 was initiated in the Dáil on 19 October and still has to pass all stages in both houses. Because the capital gains cut applies from 7 October and the fund rate from 1 January 2027, both are already part of planning for the current year. Amendments during the debate are possible, and the start date of the investment account depends on a ministerial order.
Work with Sebastian
If you are moving to Ireland with an existing portfolio, or leaving Ireland with gains still to realise, and want the timing of residence, sales and funds planned together, that is the kind of cross-border question Sebastian works on with internationally mobile clients. Book a consultation.
