CGT on sale of UK Gilts

mcardler

Gains on sales of UK Gilts are not taxable for UK residents. Gains on sales of Irish Government bonds are also free from CGT for Irish residents. My question is are gains on disposals of UK Gilts taxable for an Irish resident who is also Irish domiciled?

nompere

Yes.

Marcusm

Indeed they are but establish also whether you have any liability to income tax under s815 for deemed accrued income which will seek to tax the interest element included in the sales price in certain circumstances.

Taxes

Do you hold UK citizenship? If so, then no, the gain would not be taxable in Ireland, despite the fact you are Irish tax resident and domiciled.

mcardler

Wow, that's interesting. I have dual citizenship. Thanks for that.

mcardler

Does anybody know where in Irish legislation this exemption from CGT on UK gilts for UK citizens domiciled in Ireland is?

mcardler

I was thinking perhaps it doesn’t appear in Irish legislation but maybe only in UK legislation?

Taxes

You will not find an exemption in the Irish domestic tax legislation, you will not find an exemption in the UK domestic tax legislation. You will have to look toward public international tax law for the answer.

mcardler

So UK gilts are issued as FOTRA securities (free of tax to residents abroad). Under UK tax legislation interest and capital gains are not taxable for non-residents. (Interest and capital gains are already tax-free for UK residents). I’m wondering does this mean for example that an Irish resident is exempt from tax in Ireland or are they just exempt from UK tax? Maybe under the double tax treaty with the UK the Irish resident is free of tax in Ireland on these securities? It’s very difficult to find an answer on line!