investing in a etf fund for my child

thebackbar

Hi Folks,
i want to set up a etf account for my very young son im hoping to start if off with 1k but contribute over time.

Questions !
* Should i register the fund in his name ?
* What platform should i use ? im looking to track the dow jones

thanks

syntheticjunk

You need to a bit of research. As you going to be passive investor - you need to avoid data feed fees, inactivity fees. As you would like to track dow only - check if there are any commission free etfs that tracks this index. This could offset money transfer cost if you'll go with some US based broker.

eggerb

How long are you planning on keeping the ETF for? Are ETFs considered by Revenue disposed of after 7 years regardless of whether they are disposed of or not? This will have tax implications.

The above aside, DEGIRO is an option. You can trade free a certain number of ETF trades per month. Other brokers may offer similar.

thebackbar

thanks for the replies folks, im planning on being a passive investor and I hope to invest in the fund for circa 18 years

LunAtlFringe

Can't assist with your query unfortunately, however to expand on what eggerb said the tax treatment for US and EU domiciled ETFs here in Ireland is quite different.

EU ETFs and mutual funds have "deemed disposal" after 8 years where the government will tax you as if you had sold them and realised the gains. Need to keep track of all the tranches you have bought and when, and losses on one tranche cannot be offset against gains on another. Really way too onerous system - wish the revenue/govt would sort it out.

US ETFs are taxed normally i.e. you buy them and then pay the CGT when you sell them. Only problem is there is a new EU rule this year requiring some additional documentation before they can be sold through a broker here in Europe, like Degiro, which means we can't buy them until they comply with it. No-one seems to know when they will be likely to be available again.

thebackbar

thanks, so im looking to get a passive type investment vehicle, what is the closest product to this that is available to someone in Ireland ?