Letterkenny Joins the Living City Initiative – Tax Relief Now Available for Town-Centre Properties

8th July 2026

By Franklins Admin

Letterkenny has been formally designated under the Living City Initiative (LCI), the Government’s tax incentive scheme for regenerating older town-centre buildings. Orders signed by the Minister for Finance in April 2026 added Letterkenny — along with Athlone, Drogheda, Dundalk and Sligo — to a scheme already operating in Dublin, Cork, Galway, Limerick, Waterford and Kilkenny. Applications are now open.

What it means 

Owners of qualifying properties within Letterkenny’s designated Special Regeneration Area (SRA) — which covers most of the town centre — can claim relief from income tax or corporation tax on money spent refurbishing or converting buildings. There are three main strands:

• Owner-occupier residential relief: income tax relief for refurbishing a pre-1975 property you will live in as your main home.
• Rented residential and commercial relief: accelerated capital allowances for landlords and business owners refurbishing rental homes or commercial premises.
• ‘Living Over the Shop’ relief: a new relief supporting the conversion of commercial space — typically vacant floors above shops — into homes, with no building-age restriction.

Key details 

• The scheme runs to 31 December 2030 — only works carried out within the scheme period qualify.
• Eligibility now extends to buildings constructed before 1975 (previously pre-1915), bringing far more of Letterkenny’s stock within scope.
• A minimum spend of €5,000 applies, with relief capped at €300,000 per project over a rolling three-year period for the rented, commercial and over-the-shop strands.
• The property must sit within the Special Regeneration Area — the boundary map is published by Donegal County Council and on gov.ie.

Why it matters 

For owners, the LCI can materially improve the economics of refurbishing an older town-centre building. For buyers and investors, it opens up opportunities in properties that were previously difficult to make stack up — particularly vacant uppers on Main Street and in the historic core. It complements the wider Letterkenny 2040 regeneration programme already under way at Market Square, the Cathedral Quarter and the Old Courthouse.

Talk to us 

If you own, or are considering buying or selling, a property in Letterkenny town centre, we can advise on whether it falls within the Special Regeneration Area and what the designation could mean for its value and potential. Contact the Franklins team to discuss.

This article is for general information only and does not constitute tax advice. Eligibility depends on the property, the works and your circumstances — always confirm with your accountant or the Revenue Commissioners before proceeding.