Employers should be given tax relief to incentivise them to provide accommodation for staff as part of a wider suite of tax measures to boost housing activity, KPMG has said.
In a pre-budget submission, the Big Four accounting firm has also called on the Government to ensure the Republic’s offering to multinationals is best in class to counteract the potential impact of protectionist US trade policies.
It said the lack of available accommodation at affordable prices is hurting “the attractiveness of the country as an investment location”.
The housing crisis is also “contributing to a demographic shift”, with many younger workers feeling the need to emigrate, KPMG warned. “This will impact Ireland’s ability to maintain a competitive and highly skilled workforce,” it said.
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KPMG’s wish list for Budget 2026 includes an extension of the mortgage interest relief to the 2025 and 2026 tax years.
It also wants the Coalition to introduce a benefit-in-kind (BIK) tax exemption for employer-provided accommodation for staff earning less than €50,000.
KPMG said: “Given the current issues within the housing sector, some employers have found it necessary to make subsidised accommodation available for their employees.
“We suggest that an exemption from BIK be introduced in respect of employer-provided accommodation for staff with income of €50,000 or less, where it is provided free of charge or subsidised.”
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To improve the supply of housing, KPMG wants the Government to lower the corporation tax rate on forward-funded residential developments to 12.5 per cent from 25 per cent.
Forward funding arrangements, in which developers agree to sell unfinished development land to investors, are an “increasingly common” feature of the market here, KPMG said. As it stands, developers who sell land before its development are taxed on their profits at the higher 25 per cent rate of corporation tax.
“This seems unfair and is not aligned with Government policy in this area,” KPMG said.
Overall, the firm said the Government should look to reduce the administrative burden and the cost of doing business by simplifying the tax code.
Recent agreements at the Organisation for Economic Co-operation and Development (OECD) have added “significant complexity” to the Republic’s corporation tax regime, and to ensure it remains competitive, an office of tax simplification should be set up to cut through the red tape, according to the submission.
On the domestic front, KPMG wants the Coalition to increase the entry point to the marginal income tax rate to align with the average wage and cap the amount of income subject to employers’ PRSI to €100,000.
Orla Gavin, head of tax at KPMG, said global uncertainty has underscored the need for a “nimble approach” to tax measures in Budget 2026, given the Republic’s disproportionate exposure to shifts in international tax policy.
