Best Tax Approach for ETFs

oghran

So apparently the Irish tax approach to ETFs is pretty awkward and you can end up loosing quite a bit to the government, depending on the approach you take.

From my research I’ve determined that the best approach seems to be getting an IB account (as an Irish citizen), purchasing a US based ETF and paying income tax and CGT on any profits.

In saying that I do have a couple of questions:

- If dividends arise, would they only be taxable if withdrawn to my bank account? Or even if they just stayed in my IB balance?

- Would this setup avoid the 8 year deemed disposal issue?

- Do I need to declare to revenue if my ETFs go up in value, or only when I sell them? I guess maybe CGT at 33% applies every year on profits?

I will of course be running this by my accountant but was curious to get some feedback and see if I’m headed in the right direction.

Shai

- dividends are always taxable as income, even when not withdrawn
- yes
- only when you sell them, at which point you pay CGT

Does IB allow you to buy US-based (non-UCITS) ETFs? I didn't think that was possible anymore.