Budget 2027 for Parents: Childcare, Child Benefit and What Changes When You Have a Young Family.

The quick version

The European Central Bank decided on 10 September 2026 to raise its deposit rate by 0.25 percentage points to 2.50%, effective 16 September. Irish lenders are expected to reprice fixed rates in the weeks that follow.

The mortgage interest tax credit, worth up to €625 for 2026, is scheduled to end unless Budget 2027 extends it. Help to Buy, the First Home Scheme and the rent tax credit are also areas buyers should watch on 6 October.

If your fixed rate ends in 2027, the most useful thing you can do before Budget Day has nothing to do with the Budget: find out what your repayments would look like at today’s rates.

What has already changed for mortgage holders in 2026

The ECB raised rates in June and decided on a further increase on 10 September 2026, taking the deposit rate to 2.50% from 16 September. The Irish Times reported that the best fixed rates on the market were around 3% before the September decision, with most new and switching borrowers paying 3.2% or more, and warned that the most competitive fixed offers may soon disappear as banks reprice.

Central Bank data put the average rate on new Irish mortgages at 3.48% at the end of July, which was still the eleventh highest in the euro zone.

The Budget doesn’t decide any of this. It is the backdrop the Budget lands on, and it is why the housing measures on 6 October matter more this year than in a falling-rate year.

Will the mortgage interest tax credit be extended?

This is one of the biggest Budget questions for existing borrowers.

The mortgage interest tax credit was introduced as a temporary measure and extended in Budget 2026 to cover 2025 and 2026. For 2026, its value was reduced to a maximum of €625 per property.

It applies to qualifying homeowners who had an outstanding mortgage balance of between €80,000 and €500,000 on 31 December 2022 and whose qualifying interest costs have risen compared with 2022.

For 2026, the credit is calculated using 50% of the increase in interest paid in 2026 over the interest paid in 2022, with the qualifying amount subject to the Revenue rules.

With interest rates rising again, the Government may face pressure to extend the credit into 2027 or replace it with something broader. There may also be arguments for allowing it to lapse, given that it was introduced as a temporary response to higher mortgage interest costs and its existing eligibility rules exclude many borrowers who took out mortgages after 2022.

Watch for whether it is extended, at what value, and whether the eligibility dates or criteria change. If you qualify for 2026, claim it through Revenue regardless of what happens next.

What buyers should watch

Help to Buy currently offers qualifying first-time buyers of new homes relief of up to €30,000, subject to conditions including a maximum property value of €500,000.

The scheme is currently legislated to run until 31 December 2029. Budget 2027 could still change the amount, property price cap or eligibility rules, but buyers should plan on the rules currently in force unless a change is announced.

The First Home Scheme, where the State takes an equity stake in a new home, is another measure buyers should watch.

Renters saving for a deposit should also watch the rent tax credit, currently €1,000 for a single person and €2,000 for a jointly assessed couple, which is scheduled to run until the end of 2028.

If you are close to buying, the sensible approach is not to delay a purchase solely in hopes of a bigger grant or tax relief, but to make sure your mortgage approval, deposit, and protection are ready so you can respond to whatever is announced.

A worked example: Ciara and Dan’s fixed rate ends in March

Ciara and Dan have €300,000 left on their mortgage with 25 years to run, fixed at 3.0% until March 2027. Their repayment is about €1,423 a month.

If they roll onto a rate of 3.5%, the repayment becomes about €1,502, an extra €79 a month or roughly €950 a year. At 3.75%, it is about €1,542, an extra €119 a month.

If the Budget raises the standard rate band to €46,000 as reported, Ciara, who earns €55,000, would save up to €400 a year. That covers less than half of a 3.5% roll-over.

This is the arithmetic many families will be doing this winter, and it is why reviewing your mortgage options can matter more than any single Budget measure.

These figures are illustrative and assume a standard annuity mortgage. Your own repayment depends on your balance, remaining term and the rate your lender offers.

Switching, fixing and the thing people forget

When a fixed rate ends, borrowers focus on the rate. Two other things deserve attention at the same time. The first is the term. Extending the term reduces the monthly repayment but increases the total interest paid over the life of the mortgage. Shortening it does the opposite. A rate change is a natural moment to ask whether the current term still suits your household.

The second is mortgage protection. If you switch lenders, you can usually assign your existing policy to the new lender, subject to the lender accepting the policy and cover. But many borrowers took out mortgage protection at drawdown and have never compared it since.

The gap between different mortgage protection premiums for the same level of cover can be significant, and a mortgage switch or fixed-rate expiry can be a useful time to review it.

Compare mortgage protection with Low.ie before you sign with the new lender, not after.

A change that helps some buyers from 15 October

Separate from the Budget, new Right to Be Forgotten provisions are due to take effect on 15 October 2026.

The new statutory framework is designed to prevent a qualifying previous cancer diagnosis from being taken into account when an insurer assesses certain mortgage protection applications once the applicable conditions are satisfied.

The framework includes a five-year period after active treatment ends and complete remission is achieved, applies to mortgage protection linked to a principal private residence, and increases the relevant mortgage protection threshold to €650,000.

If you or your partner were previously declined, or had additional terms applied to mortgage protection because of a cancer history, the new rules may be relevant to a future application once they take effect and the qualifying conditions are met.

We have written about applying for mortgage protection after cancer and will update that guide when the legislation takes effect.