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Budget 2026: What Irish SMEs Should Be Watching

Budget 2026 will be announced on Tuesday, 7 October 2025, with the Government signalling a package worth €9.4bn. Of this, around €1.5bn is expected to go towards tax measures, and €7.9bn towards public spending. For Irish SMEs, the detail behind those numbers could make all the difference to business planning for the year ahead.


At UHY FDW, we are keeping a close eye on the areas that matter most to our clients. Here is what we think you should be watching.

Budget 2026: What Irish SMEs Should Be Watching

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Tax reliefs and growth supports

Tax remains a central focus. While the scope for big cuts is limited, SMEs will be watching for practical changes that boost competitiveness and investment. Expect ongoing debate around:

  • R&D tax credits 

  • Employment Investment Incentive (EII) and KEEP share options 

  • VAT refinements 

 

A major development is the rollout of auto-enrolment pensions from 1 January 2026. This will be a game-changer for employers, with contributions required under the new 3 (employee) : 3 (employer) : 1 (State) model. Planning for payroll, budgeting and communications should start now.

Energy and sustainability


The universal energy credits we saw in recent years are unlikely to return, but SMEs may benefit from more targeted supports, especially those investing in energy efficiency or green transition projects. Watch for grants that could help reduce long-term operating costs while supporting climate goals.

 

VAT Adjustments

Sector-specific VAT changes are often debated, especially in hospitality and construction. While no major overhaul is expected, Budget 2026 could include targeted tweaks.


  • What it could mean: Even a 1% change in a VAT rate can significantly affect margins in consumer-facing industries.

 

Small Business Reliefs

Schemes like the Employment Investment Incentive (EII) and the Key Employee Engagement Programme (KEEP) are regularly highlighted for reform. Streamlining these supports could give SMEs more flexibility to attract investment and retain staff..


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How to prepare now

  • Plan ahead for auto-enrolment – budget for contributions and update payroll systems.

  • Model cashflow – consider possible VAT or PRSI adjustments in your forecasts.

  • Stay alert for grants – line up potential projects that could benefit from sustainability funding.


What UHY FDW Can Do for You

At UHY FDW, we do more than just interpret the Budget, we help you act on it. Our team works with SMEs across Ireland to:


  • Turn policy into practical steps – translating Budget changes into clear actions for your business.

  • Plan for tax efficiency – from R&D credits to VAT and payroll, we make sure you maximise every opportunity.

  • Support compliance with confidence – guiding you through auto-enrolment, PRSI updates, and reporting obligations.

  • Strengthen your cash flow – forecasting, modelling, and preparing for the impact of policy shifts.

  • Unlock funding & growth supports – identifying grants, incentives, and reliefs relevant to your sector.


With the right advice, Budget 2026 does not have to be a challenge, it can be a catalyst for growth.



Talk to our Audit, Tax and Advisory experts today about how we can help your business prepare, adapt, and achieve more.





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