Unlocking Growth: Planning Permission in Budget 2026
Get insight into how Budget 2026 impacts construction and planning in Ireland.
Irish Budget 2026 introduces significant incentives for the property and construction sectors. A key measure includes reducing the VAT rate on new apartment sales from 13.5% to 9%, effective from 8 October 2025. This applies to all new apartments, enhancing their marketability and affordability.
Another crucial incentive is an enhanced corporation tax deduction of 125% on qualifying apartment construction costs. This is capped at €50,000 per unit, available for schemes with ten or more apartments, including conversions. The measure aims to boost supply and encourage development, particularly given the ongoing housing needs.
These measures are part of broader efforts to address dereliction and promote regeneration. While details on certain applications, such as co-living and student housing, require clarification, the overall strategy supports the housing sector’s growth. The focus on construction and development aligns with broader planning permission strategies, potentially influencing future housing scheme approvals and An Bord Pleanála decisions.
For developers, these incentives can significantly reduce costs and increase profitability, making the prospect of acquiring planning permission more attractive. However, the interaction with existing environmental and zoning regulations will be crucial in ensuring projects are viable and compliant.
Developers must consider the environmental impact and ensure compliance with regulations, as these changes aim to stimulate growth while addressing societal needs. The temporary nature of some measures suggests ongoing evaluation and potential adjustments based on outcomes.
- Reduced VAT: 9% on new apartments from 8 October 2025.
- Enhanced Tax Deduction: 125% on construction costs, capped at €50,000 per unit.
- Development Focus: Boosting supply, addressing dereliction, and promoting regeneration.
These measures are set to have a positive impact on the construction sector, aligning with broader strategic goals for urban development and housing supply.
As the Irish government moves to address housing challenges, these incentives will play a critical role in shaping the future of property development and planning permission in Ireland.
Originally reported in Property & Construction – Budget 2026 – KPMG on Thu, 09 Oct 2025 12:04:58 +0000. Full story
