capital gains tax on shares

ibrahimovic

Bit confused on this one. I want to switch my money from my savings account to a few medium risk funds on td investing.
IS it just a case of putting the money in td investing and buying the funds and whenever i sell them pay capital gains tax on any profit? I dont intend on selling them for years, so would it be 25% of whatever the profit is of what i originally put in to when i sold it?
How do I declare it too? This kind of information always seems to be hard to find.

gavmcg92

ibrahimovic wrote: »

Bit confused on this one. I want to switch my money from my savings account to a few medium risk funds on td investing.
IS it just a case of putting the money in td investing and buying the funds and whenever i sell them pay capital gains tax on any profit? I dont intend on selling them for years, so would it be 25% of whatever the profit is of what i originally put in to when i sold it?
How do I declare it too? This kind of information always seems to be hard to find.

New enough to this as well but as far as I am aware, you need to disclose it on a form 11 for the year end that you sell the shares.

Dardania

what about the income from dividends (not that I make any really...)

ibrahimovic

Just seen capital gains tax is 33% and not 25%. People in the uk are allowed to have a shares isa that with 20k relief of tax a year fecking robbing country.

Strettie11

ibrahimovic wrote: »

Just seen capital gains tax is 33% and not 25%. People in the uk are allowed to have a shares isa that with 20k relief of tax a year fecking robbing country.

When you say you are going to invest in funds what type of funds are you referring to? Etf's? Individual shares?

ibrahimovic

Think it may be an etf? Its an equity fund anyway thats all i know. Ive been reading a book on investing and he advises on the types of funds you should own, averages about 8-12% per annum, but noticed its gone up over 5% in the 6 weeks ive read the book. 33% is real robbery though, taxing people that much who want to show a bit of initiative. Good way to keep us down.

ibrahimovic

Might go to to the citizens advise bureau, would they be able to help?

Strettie11

Sorry to make this complicated but for you but I posted the below last year on taxation of ETF's

If you google "ETF Revenue" the first link should be a link to a PDF from Revenue detailing tax treatment.

In summary though the main issues are:

- Irish or EU domiciled ( where they are established) ETF's are taxed @ 40% both Income (dividends) and gains. No PRSI or USC applies

- US, EEA & OCED domiciled ETF's
gains subject to Capital gains tax @ 33%
income (dividends) taxed at 40 % PLUS PRSI & USC

so lets take an example I invest in 2 ETFS last year both Irish domiciled , I sell both yesterday one I make a gain of 2000 and one I make a loss of 1000

I will pay tax of 800 ( 2000 X 40% ). Please note there is no deduction allowable for the loss of 1000 on the second ETF


Similiar example but I invest in 2 US domiciled ETF's last year I sell both yesterday one I make a gain of 2000 and one I make a loss of 1000

I pay no tax as they are treated as capital gains and losses I can set the 1000 loss against the 2000 profit leaving 1000 taxable but I can also use my capital gains tax free allowance of 1270 which leaves nothing subject to tax !!!

So if you are investing for gains it is better from what I can see to invest in US domiciled ETF's . Remember a US domiciled ETF can be an ETF based on euro indexes/ currencies.

If you are investing in income ETF's that pay regular divs it is better to invest in Irish EU domiciled ETF as you avoid PRSI and USC

Hope this helps I would advise seeking your own financial advice before investing in an ETF.

ibrahimovic

Wow sounds madly complicated! I appreciate the reply! Thanks

This is one of the funds I wanted to invest in, is it an etf?

https://www.fundsmith.co.uk/

Thanks!

myshirt

That's not an ETF. An ETF is basically index replication, try Vanguard who are the cheapest. They are really pissing fund managers and custodians off with their slick model.

ibrahimovic

Oh yeah i read about them cheers, so are those funds i linked 33% capital gains then?