ETF Investing in Ireland | Everything You Need To Know

[@TheLearningsReport]

A lot to take in here, so make sure to hit us up below if you have any questions 👍 In our opinion, ETFs are certainly valuable investment tools, but the tax on them (especially in Ireland) is significant and certainly has its downsides. What do you guys think about stocks vs ETFs considering the tax implications?

[@whatyoushouldknowabout6189]

ETFs tracking passive market index funds (eg. FTSE All World, S&P500, etc.) are great investment vehicles. Not so sure about ‘de jour’ index funds (marijuana ETFs anyone!!). Being informed about the downside of ETF taxation here is important, for people to make informed decisions. Is the tax drag worth the immediate diversification, simplicity, low fees...? In some cases yes. Some no.

[@TheLearningsReport]

Well summarised, and indeed there truly is an ETF for everything! The VICE ETF is always one I find interesting 😂 It's a shame about the elevated tax, but agreed - instant diversification and simplicity is an easy pill to swallow.

[@davidfagan9080]

Hi guys, if you invest regularly into an etf, say every month for example, how does the deemed disposal rule work then?

[@TheLearningsReport]

@@davidfagan9080 Hey Dave, pretty much the same. If you're adding to an ETF regularly, on the 8th year anniversary of when your first purchased it, you will owe 41% tax on any profits accumulated up to that point.

[@davidfagan9080]

@@TheLearningsReport perfect. Thanks very much. Wasn't sure if you needed to do it on the anniversary of each time you invest.

[@Sarahlana-j3v]

Planning ahead can really minimize taxes! I've made a smart reinvestments, especially with some great guidance from a pro for a half year now, and it's been a game changer. I was able to reinvest my RMD strategically, and I'm now pulling in about $25k a week, despite doing very little trading myself. It's a nice cushion against financial stress. Best of luck with your RMD decisions!

[@AndyNeo-h3p]

25k a week? Amazing! how did you get started?

[@Sarahlana-j3v]

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[@CristinaJones-i9j]

Honestly I really need help learning to trade. Seeing my portfolio low makes me very sad.

[@Williams-r3h]

I suggest consulting with Amalia bunker for guidance, This way you can get strategies designed to address your unique long/short-term goals

[@pranjal7293]

Honestly, Revenue should put this video on their website! Great job guys! It's sad to see that in a country with one of the lowest corporate taxes, it's the general population that suffers the most.

[@TheLearningsReport]

Appreciate it! The lack of clarity was the reason we did this video in the first place, so it’s great to hear that it helped you out. Agreed, the tax rates are v unfortunate! Cheers for the comment 👌🏼

[@garrettjoyce7699]

We should really start a petition to get efts classified the same a shares , I don’t mind paying tax it’s a parts of life but paying taxes on profits you haven’t even taken out every 8 years is ludicrous

[@TheLearningsReport]

Hear! Hear! Investing through a pension is one way to avoid taxes on gains but you are restricted with when you can withdraw. - Cian

[@127spud]

I've been thinking this for awhile 😂 somebody set it up because 41% is absolutely ridiculous.

[@josephboyle98]

@@TheLearningsReport can you avid the deemed disposable if through a pension?

[@TheLearningsReport]

​@@josephboyle98 ​ Hey Joe - that's our understanding yes, but I think it also depends on your specific pension plan (need to double check this one) so let me circle back with ya on it. - Ste

[@josephboyle98]

Thanks thats great advice! And brilliant video thanks so much

[@irishwealth6346]

Great video lads, the tax on ETFs is crippling in Ireland, it would really put you off investing in them for sure! I’d love to see the rules changed on this in Ireland, for smaller retail investors it’s a serious detractor to getting involved in the market outside of your pension fund. I think now with the influx of new retail investors the government will be seeing a lot more money coming from CGT. I feel like a single individual deciding to passively invest a few quid every month to better their financial future shouldn’t be burdened with such a significant tax hit. Sorry for the rant, it just bugs me 🤣

[@TheLearningsReport]

Haha literally nothing to add to this, you've nailed the synopsis. It just doesn't make sense that one of the safest and reliable forms of investing is less incentivised in Ireland (due to the way its taxed) than individual stock investing, which due to its nature is inherently 'riskier' for most investors. Definitely second your hope that we see some changes due to the influx. That being said, I worry that covid will adversely effect the rates of tax across the board - and assumably CGT will be high on the list in terms of hikes, despite its already elevated status. 🤷‍♂️ Ste

[@irishwealth6346]

@@TheLearningsReport Yeah I really hope that’s not the case, hard to see how much they can increase without just taking all our profits away 😅 I guess if you’re concerned about taxes then it means you are profitable which is a good thing at least 😆

[@TheLearningsReport]

@@irishwealth6346 Agreed. The issue, I feel, is that investing is still generally seen as for the 'wealthy' (and it is to an extent, of course) and thus it's easier to just say "ok lets increase the CGT tax and let the rich pay more". This of course becomes a problem as more 'everyday' investors get their start, and the tax burden on them is not equal relatively speaking. But yes at the end of the day, it's still far better than a return your savings account will give you!

[@irishwealth6346]

@@TheLearningsReport 100% agree!

[@edsonrocks]

Great video, thank you. Investing in Ireland is a subject so tough to find useful and clear information. Keep up rocking :D

[@TheLearningsReport]

Love it, Edson - we really appreciate that! Glad you're enjoying the channel and please do pass along the video to anyone else you think it might help. Great to have you on board 👌

[@remco2777]

Brilliant video ! Best explanation of Irish tax rules on ETF investing in Ireland I have come across.

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[@DanöVee]

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[@ToreyLanez]

Absolutely. Having the right financial planner is critical. My portfolio is strategically diversified for all market conditions, and it recently achieved a 90% increase since early last year. My CFP and I are aiming for a seven-figure goal, though it may take until Q3 2024.

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[@FerdLerd]

Thank you for sharing! I did a quick search and found her website. I hope she responds to my email soon.

[@shanerafferty4913]

Thanks a million lads! Very informative video💪

[@VelcroKittie]

The tax con is an immediate no no for me. It's such a shame because I would absolutely love to invest in a high dividend yielding ETF, but as things stand right now, the tax is the deal breaker. Hopefully Ireland gets with the times. There is a severe lack of education on investing. It should be part of every secondary school education. I'm 43 now, and if I knew back then what I now know about investing my life would have panned out very differently. Had I a teacher in secondary school as talented and encouraging as my Science teacher was, we would have all left school with a solid foundational understanding of investing.

[@TheLearningsReport]

Well said. Agreed on all accounts (we're two decades behind you and can confirm we didn't learn any of this stuff in school either). We're hoping that our videos can at least help get some people started - but you're right, this should be way more integrated into regular school curriculum. And that goes for personal finance in general (as opposed to just 'accounting' etc.) Thanks for your comment. - Ste

[@michaeldoyle4728]

I am 24 year old just beginning to learn about investing. Any tips would be greatly appreciated. Thanks

[@carlosf.2927]

Could you make a video talking about 'non-domiciled' status in Ireland for people who live in Ireland but they are not Irish? Could you explain about taxes and what is the correct way to make investments in that case?

[@asrfarinha]

Thanks for the video, guys! Loads of important information. I was considering investing on an ETF of European stocks to diversify from my mostly US-based investments, but the tax implications are just too unreasonable, especiall the deemed disposal rule. That one is just absurd! Why is the Irish government so hostile towards investors?

[@TheLearningsReport]

Again, thanks for the comment António! That's a great question, and one we ask regularly ourselves. On Reddit there is a group that I believe are lobbying to have this rule changed (as it certainly would have benefits). I remember reading that it was initially introduced due to dividend tax avoidance or something along those lines (don't quote us on that!) but yea, in a nutshell, the ETF tax is such a disincentive for new investors to get started. If anything, it pushes people to invest in individual stocks which is inherently riskier already. ETFs and index fund investing should be the most incentivised investing tool given its long term proven track record. My guess would be for decades, investing was only accessible to the rich, so it was easier just to say "ok you pay more taxes". The issue now of course, is the rise of the retail investor, who has far less disposable income than the 'traditional' investor from a decade or two ago - yet we all pay the same tax.

[@MrHisenber9]

Super useful guide for a beginner who wishes to invest from Ireland or Europe. I'm 23 yo and planning to start investing from now on. Thanks for a great video guys! P.S still a bit confused about usd and eur options for one etf

[@bubblesfw]

This is the video I have been hoping for!! Thank you very much lads 😊

[@TheLearningsReport]

Anytime!

[@chluain1]

These videos are incredible. Every Irish person should be paying attention. Please keep them up

[@TheLearningsReport]

Thanks a mill for watching and for the kind message, Chluain. Plenty more to come! - Cian

[@nidge1956]

Great video lads. You did a fantastic job. I bet this will benefit many people.

[@TheLearningsReport]

Cheers Nidge 👊 Glad you found it helpful!

[@atharvajoshi8539]

Can you make a video on how to file tax for dividends and etf please ?

[@peterjoyce8657]

Really good informative video in simple & plain English thank you.

[@leandrodibartolo1796]

Great video! I'd like to know what is the situation to "non-domiciled in Ireland but tax resident in Ireland" individuals. 1 - Are they still subject to the Deemed Disposals when acquiring a Irish domiciled ETFs? 2- What happens if they leave Ireland before the 8 years time? 3- Are US based ETFs available for them? Thanks so much!

[@pabloa8961]

Excellent video 👏

[@TheLearningsReport]

Thanks, Pablo! See you in the next one. - Cian

[@manipuriinireland2103]

Very informative for the beginner like me in investing

[@TheLearningsReport]

Hey Manipuri, Thanks for watching and glad you found it interesting. We have more videos for beginners that you can check out here: Investing Guides for Beginners 📈: kzbin.info/aero/PLvKfba1wmPk9Ix6n3mrRNEKxwSP-STPcx - Cian

[@manipuriinireland2103]

I have seen one of your video about ,the broker so I have no background knowledge about the investment just thinking which broker is best between Degiro and interactive broker ,can you please suggest

[@TheLearningsReport]

@@manipuriinireland2103 It comes down to preference - but IBKR might be better if fractional shares is something you'd find useful!

[@manipuriinireland2103]

@@TheLearningsReport 😊

[@briansheehy1166]

Great video! Any chance you could do a video on the different ETFs available in Ireland?

[@TheLearningsReport]

Hey Brian, thanks for watching! Do you mean a broad overview? In general, we don't look at specific stocks, cryptos, ETFs, etc., but maybe we could look at a comparison analysis at some point. 👍 You can check which ones are available by searching on your broker. And justetf.com is a good resource for finding out more about ETFs and strategies. - Cian

[@iscaralm]

Guys, keep up the good work. I am amazed to find your channel. I had been reading the revenue website to understand that 41% tax and you just clarify it with additional information. Thank you, new subscriber here...

[@TheLearningsReport]

Great stuff, Isac! Glad you found it helpful. Yeah, the Revenue website can be confusing at times but we don't want that to be a reason to stop people from investing! - Cian

[@10PLAYDOH]

41% is outrageous my god! Thanks for this video helps massively. So hard to find info on Irish investing and tax.

[@_el.guapo_]

Thanks for bringing up that topic. At 10:22 do you mean we still pay taxes on dividends from accumulated ETFs?

[@TheLearningsReport]

Hi Laurent, For ACC ETFs, you don't need to pay taxes annually on the dividends. You would only pay when you sell the ETF or on the deemed disposal date. - Cian

[@_el.guapo_]

@@TheLearningsReport Excellent! That's one thing these blood suckers won't get. A tip about ETF's in different currencies: I've heard of some people having the same ETF, same amount invested, in 2 different currencies. For instance VUSA in € and VUSA in $. If you plan to life off the profit of the growth in 10 years, you would sell a portion of the ETF that has better currency conversion (for instance it depends if the $ has devalued or not at the time of the withdrawal). It could be a good hedging strategy.

[@TheLearningsReport]

@@_el.guapo_ Interesting, have you come across a VUSA offering in USD? Don't think I have but perhaps it's not offered by my broker. Will have to do some more digging on this! Cheers for flagging. - Ste

[@ronyswed2404]

Great video guys, keep it up 👍

[@TheLearningsReport]

Thanks, Rony! Any ETFs on your radar? - Cian

[@mattphillips4329]

Hey guys... amazing video content! Thanks so much! So I'm a US citizen, but I'm living & working in Ireland (tax resident & paying tax in Ireland every year). I have a significant amount of USD (located in a US bank acct) that I'm looking at investing in VOO (Vanguard's US-based ETF - with all of its advantages) as a long-term investment (not planning on pulling it out for 20+ years). Q1) But since I'm currently tax resident in Ireland, it sounds like I'd still be hit with the forced 41% on gains after the 8yrs, 16yrs, etc., yeah? Even though I'm not selling / repatriating any of that USD into EUR / Ireland? Q2) What if I had purchased VOO like 7 years ago, moved to Ireland, and lived here for 1 year? Would I still be on the hook for the 41% deemed-disposal tax at the 8yr anniversary of ownership? Q3) As I'm sure you know, the USA and Ireland have a double-taxation treaty... so (just out of curiosity) if I sold the VOO after let's say 9 years of ownership (still tax resident in Ireland), US CGT is let's say 20% for the amount of gains I'd have, but I've paid 41% on the gains in Ireland just last year. Would I have a 21% tax credit in the US because I paid the 41% in Ireland just last year? Q4) So what if I moved back to the US in the 7th year of owning the VOO (assuming the deemed-disposal law is still around then)? Upon the 8th year, I would no longer be tax resident in Ireland... thus no need to file Irish taxes, and no 41% on the gains? Sorry if these questions are super complex. Hope you're well. Okay... quick update based on some more research (This video kzbin.info/www/bejne/aZbPmGahaJVgqsU starting at 8:00 lays out the context). Q5) All of my above questions might be irrelevant because it sounds like US domiciled ETFs are treated like stocks for Irish tax purposes (aka - you only realize CGT when you sell... the deemed-disposal rule doesn't apply)... is that correct? Q6) And any distributed dividends from the US domiciled ETF will still be taxed at the marginal rates... yeah? Sorry for how convoluted this post got. Just trying to think through all this. :) Cheers! And thanks in advance. :)

[@TheLearningsReport]

Hey Matt, Nice one - thanks a million for watching! So, to start I would just caveat that we aren't tax advisers and your situation is quite unique so I would recommend chatting to your tax adviser to get clarity on these questions for your situation. But, here are some helpful resources and general rules that might help: 1) Are you domiciled in Ireland? There are different implications depending on your domicile. Leaving a link below to Revenue's rules If domiciled and resident (www.revenue.ie/en/jobs-and-pensions/tax-residence/index.aspx): "If you are resident and domiciled in Ireland for tax purposes, you are chargeable to tax in Ireland on your worldwide income." If not domiciled (www.revenue.ie/en/jobs-and-pensions/tax-residence/what-is-domicile-and-the-domicile-levy.aspx): "You may be Irish tax resident, but non-ordinarily resident and not domiciled in Ireland for a tax year. In this case you will pay Irish tax only on your: -Irish source income -foreign income to the extent that it is remitted into Ireland." 2-4) I think this might be quite nuanced to your situation so I think your best bet is to raise these enquiries on Revenue or with your tax adviser. 5-6) Sharing a really good Fiona Redden article explaining how ETFs are taxed based on domicile at the bottom but correct for US-domiciled ETFs you pay the following: "Tax on gains: Capital gains tax at 33 per cent Tax on income: Income tax + PRSI + USC" - www.irishtimes.com/business/personal-finance/don-t-invest-in-an-etf-until-you-understand-the-tax-1.3421331 Hope this helps, Matt. If you do reach out to Revenue about questions 2 - 4, let us know what they say. we'd be curious to understand more! -Cian

[@johnbutler907]

Hi Chaps, great video! I understand there may have been a recent update with regard to Etfs and how they are taxed. I can't see anything online. Have you guys any knowledge on that?

[@TheLearningsReport]

Hi John, Thanks a million for watching. Very interesting, I (Cian) have not seen anything on this and just did a quick search for any update there but it doesn't look like there has been anything confirmed. Where did you originally see/hear of this update? Please keep us updated as all of our ETF investing viewers are desperate for some reform! There may be a change in the upcoming budget although it seems unlikely given the amount of spending that has happened in the past 2 years. I came across an interesting recent article in the Irish Times which runs through the current differences between Exit tax and CGT/DIRT which you might be interested in: www.irishtimes.com/business/personal-finance/why-do-some-investors-pay-more-tax-than-others-1.4684106 Thanks again for watching! -Cian

[@clivehannon]

Holding non leveraged cfds is a way of being taxed at 33% but is holding cfds long term a good thing ? Would be really interested in your thoughts

[@jackjennings9293]

Thanks for the video. I'm planning on starting investing but I'm also moving to the UK in a few weeks. Should i set up my account on Degiro in the Uk to avoid these taxes or are they still applicable if I'm withdrawing to an Irish bank account? Thanks

[@TheLearningsReport]

Hey Jack cheers for watching. It'll likely come down to your tax residency/domicile as opposed to bank accounts. Couple of links below that should set you on the right track. In short though, you might be better holding off until you reach the UK. Best of luck with the move! www2.deloitte.com/content/dam/Deloitte/ie/Documents/Tax/ie-tax-ges-moving-abroad-guide.pdf www.revenue.ie/en/jobs-and-pensions/tax-residence/how-to-know-if-you-are-ordinarily-resident-for-tax-purposes.aspx

[@anthonybyrne2262]

You pay the tax in the location you're ordinarily resident. So, if you live in the UK, you will pay tax to the HMRC. If you live in Ireland, its the Revenue commissioner. UK tax is soooo much better for this sorta stuff. Open an investment ISA and you don't need to pay *any* tax on your gains. The only catch with the ISA is that you can only invest up to £20,000 pa. But every new year you can invest another £20,000 and leave last years investments to appreciate for as long as you want tax free :)

[@shanthi3152]

Investing in stocks / etf seems easy compare to understanding this tax rules in Ireland. Head rotatinggggg :D

[@TheLearningsReport]

Haha, they don't make it easy! 🤯 - Cian

[@davidflannery3991]

Hi Guys, just found your site...love it, I have a question you may be able to help me with. Im an Irish citizen who has lived in Australia, as a permanent resident, for the last 15 years. If I buy ETF's that are all domiciled in Australia: 1. As Ireland taxes Irish citizens on all income earned Worldwide, I assume that I will be taxed in Australia, under Australian tax rules, based on the tax treaty Australia has with Ireland so no Double taxation , Correct? Therefore the Irish 8 year Chargeable event does not apply...... correct? 2. So what happens if I move back to Ireland to live in say 10 years....I bought the ETF's when I lived in Australia and they are all domiciled in Australia .... does the 8 Year chargeable event apply when I move back? and if so from when? i.e. from when I bought them originally or from when I moved back to Ireland? 3. Are Investments Trusts. Managed Funds or Listed Investment companies (LIC's) as they are known as in Australia ( achieves the same things as ETF'S but has a closed ended structure instead of the open ended structure that ETF;s have, in other words the LIC has a finite number of shares available at any one time) treated the same way in relation to tax? Thanks Dave

[@TheLearningsReport]

Heya Dave - hope all is well over in Oz. 1. You shouldn't be liable for Irish taxes if you've been in Australia for 15 years (this may have been a typo in your message as the second part of your question seems to indicate you're aware that Ireland does NOT tax worldwide income once you've been gone for longer than 3 years). For these three years you must pay Irish tax on your worldwide income EXCEPT for: - income from a trade or profession, no part of which is performed in Ireland - income from an office or employment, where all the duties are performed outside Ireland - other foreign income, for example, investment income, if it is €3,810 or less. If it is more than €3,810, the full amount is taxable. As you can see from the above, most who leave Ireland and then work elsewhere, won't be taxed at all in Ireland. 2. For the ETFs you bought in Australia, the short answer is, I'm not 100% sure. I would guess/speculate that you may avoid deemed disposal given they're domiciled and purchased when you were in Australia (and thus you may be liable to pay the tax in Australia instead) but frankly, I don't know the answer to that one. Might be worth running it by a few accountants over in Australia to see what the craic would be on their side! 3. For investment trusts, I understand those to be taxed under CGT and not 41% exit tax like ETFs. Paddy over at Informed Decisions (he has a podcast also) did a great piece on them which I've linked below. informeddecisions.ie/investment-trusts-in-ireland-blog-159/#:~:text=Pros%20of%20Investment%20Trusts%20in,opposed%20to%2041%25%20Exit%20Tax.

[@offwhitetower]

Hi guys! I have watched about seven of your videos so far (more to come), and it's so great to have the information in an Irish context - the classic texts like Graham and Malkiel have been super-useful except when it comes to the practical aspects of becoming a newbie passive investor! I have two probably very stupid questions that despite my research I'm having difficulty finding a (passive) answer to, so if you could answer them that would be great. The first is: I do want to put my investment money into index funds, but are there Irish citizen options for this that aren't ETFs? I'm guessing that for the S&P no (?), but are there equally robust ones that do the same job? And the second question is if you can set up a direct debit or regular annual transfer (eg the 3k CGT gift exemption) into these funds so it goes out before I can see it to spend it ...? Thanks a million for putting this all out there. Cheers, Rachel 😊

[@TheLearningsReport]

Hey Rachel - Great to hear you're starting your investor journey, and delighted you're finding out videos helpful :) Q1) The short answer is 'not really' but I do believe investment trusts can do something similar - although I don't own or invest in any myself. Informed Decisions (run by another Irish guy) have a great post on investment trusts that might be worth a read informeddecisions.ie/investment-trusts-in-ireland-blog-159/#:~:text=Pros%20of%20Investment%20Trusts%20in,opposed%20to%2041%25%20Exit%20Tax. Q2) Many brokers will offer a direct debit to your bank account (or similar) so that you can set up a reoccurring payment directly, removing your temptation to spend it - although you will likely still need to actually click the 'buy' button, so its not completely automatic. That being said, some brokers may offer this functionality, I just might not be aware of them! Alternatively, you could set up a vault on Revolut (or similar internet bank), schedule a payment to go into that vault every month, and just get into the habit of taking that vault and sending the funds directly to your brokerage account before spending it. Hope this helps somewhat! - Ste

[@MrBrod1985]

Hi lads great video, I am currently looking to invest my self administered pension in an ETF, preferably one to track the S&P 500, do you know are any taxes involved going down this route as I am not aware if any CGT or disposal taxes apply? Keep up the good work!

[@TheLearningsReport]

Hey mate - Sorry for the late response - big summer off! This is a tricky one, and one we've never full clarified. Usually via the pension route, you don't have to worry about the deemed disposal or CGT but I would certainly get a second opinion to back us up, especially as I'm not sure when it comes to the self-administered option. Sorry I can't be of more help. If you found out the answer in the meantime, please do share!

[@peterelst]

I'm wondering with regards to the deemed disposal rule - what happens if you've paid and keep your shares invested after the 8 years? Do you still have the 41% exit tax on further gains when you do sell? If so, what is the gains reference point, the original investment or anything after the 8 year deemed disposal? Thanks!

[@DAc2723]

You’re not taxed twice on same profit. For the second calculation you treat is as if you bought the ETF at the 8 year point

[@Iambecome]

Thank you for this outstanding video (so clear and engaging) and for replying to everyone's questions in the comments. Could I ask (not looking for advice) your general thoughts on the Vanguard FTSE All-World, compared to the Vanguard S&P 500? Is it best to pick one, rather than both? Or does it generally not matter a whole lot? Any general thoughts on this would be brilliant!

[@TheLearningsReport]

Hey Cape, Glad you liked the video and found it helpful! So, to pre-empt, in general we don't advise people on specific stocks/ETFs and it is up to you to do your due diligence on researching the stocks. Having said that, there are certain differences between them in terms of what they are focused on. S&P is focused on American companies and there are 500. FTSE is international and has >3,000. Within the two there would be companies of different sizes/industries/business models. So, it would depend on how much you want to index your funds between the two. And then you would need to look at the financials, costs, analyst reports, etc. to compare the quantitative side of the ETFs. The more diversified you are, the less risk but potentially less reward. Hope this helps and best of luck with it! - Cian

[@Iambecome]

@@TheLearningsReport Much appreciate the reply, cheers Cian. Subscribed, keep up the brilliant work!

[@TheLearningsReport]

@@Iambecome Love it, thank you!

[@des1458]

Great Video. just a question on deemed disposal. lets say for example your investment strategy was dollar cost averaging and you invest a set amount of money every month for the 8 years upto your first deemed disposal is due. in year 9 (year tax is due) are you paying tax on just those first 12 purchases as its only those purchases that are 8 years old and then the following year you pay deemed disposal on the next 12 purchases. from this wouldn't it mean your paying deemed disposal every year after year 9.

[@TheLearningsReport]

Hey Des, Yeah, I think you've hit the nail on the head there. That is my understanding albeit there is very little clarification on Revenue's website. It would get even messier when you get into year 17, 25, etc. when there will be multiple deemed disposals. It's so messy, would love clarification or a simpler process from, Revenue. Or, at the very least, move ETFs to CGT! - Cian

[@TheLearningsReport]

Ms Money Hacker has a great explainer piece on her blog that might offer some more transparency! Linked below (and a shoutout to her - her blog posts are a great read if you're an Irish investor) mrsmoneyhacker.com/how-to-file-taxes-for-etfs-in-ireland/#Deemed_Disposal

[@niallfagan7834]

Thanks for the videos lads, great to have the info in the irish context. I have a question about deemed disposal. If someone makes monthly contributions into an ETF over a number of years, do they need to pay deemed disposal every year after the initial 8 years as they will essentially be making a new investment every month? I'd say you'd need a full time accountant to sort that out if that's the case.

[@TheLearningsReport]

Howiya Niall - no worries and cheers for the question. So yes, sadly, that is also our understanding too. Ms Money Hacker did a great blog piece breakdown of it (caveat: I don't think she's 100% certain on the situation either!) and I've linked below for your reference. mrsmoneyhacker.com/how-to-file-taxes-for-etfs-in-ireland/#Deemed_Disposal I haven't had to deal with the 8 year rule just yet - still living in blissful ignorance for now! Always worth pinging revenue a message to see what their take on it is. - Ste

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@@raymondbarnes5264 'MARGARET ANN WARNKEN".

[@greenquake11931]

@@raymondbarnes5264She is my FA, she can help. Look with her name online for her webpage.

[@mariahhayes5089]

Trying to earn some extra income and this comment came in handy. Thanks 😊

[@sharadpatel8387]

Hello lads, this is a great video, I wish revenue were as efficient as you! Quick question: If I were to sell my etfs to rebalance at the end of each year, let’s say because there was a market crash and I wanted to take some of my bond etf to buy more into my S&P 500 etf, would I have to pay capital gains on that for that specific year? Also if I were to buy a portfolio of etfs, let’s say 10K divided into a percentage across a few different allocations, would I have to fill the RST01 form or is that just for individual stocks? Thanks so much for the information!

[@1sport_editz994]

Great video, I read that when you purchase ETFs you need to inform Revenue about every purchase. Is this correct?

[@TheLearningsReport]

Hey Karol - appreciate the comment and question! So yes, technically you do. I'll be completely honest and say I haven't done that 100% of the time, and not sure if there are any repercussions either way - but again, apparently you do. Cheers for watching!

[@charlotteweever4936]

@@TheLearningsReport Hi guys :) love the videos wow! Just following up on the question there above - I'm assuming that if the purchase of an ETF (let's say accumulating) occured in 2021 that you would declare the purchase during your self assessment in 2022 using the Form 12 (if that's the correct one for the individual) - would that be the correct approach? Thank you for casting light on a (suspiciously) confusing process!

[@TheLearningsReport]

@@charlotteweever4936 glad you like the videos! So, this one is a bit peculiar. If you are filing a form 12 online or paper version, there is no option to declare assets being acquired. If you do sell, it would be declared on a CG1 form the year after disposal. Given that you haven't disposed and it is ACC, then you don't need to pay in the year or file the dividends. For contrast, if you are filing a form 11 as a Chargeable Individual, ETFs are classified as offshore funds for CGT purposes. To declare the purchase, you would enter it as "Other" in the Chargeable Assets section. I can double check with Revenue but currently my revenue.ie account is down so might be a while before I can ask! - Cian

[@charlotteweever4936]

@@TheLearningsReport they certainly like to make things complicated - thanks Cian it's super useful to get these insights - not to worry if you can't ask at the moment. If you do remember next time you're on to them I'd love to hear more - cheers and again great videos - I've spread the word :)

[@TheLearningsReport]

@@charlotteweever4936 brilliant, will do. Should be able to get answer to you before 2022, anyway. 😂 Any other questions, just shout! - Cian

[@Danilo2012fim]

Hi guys great video, well explained. Could you make a video telling about after sell the ETF or Stock or receive an income when we should pay tax? All at the end of the year or the month. Thank you

[@TheLearningsReport]

Hey Danilo, thanks for that! Have you watched our video on capital gains tax? We explain it in that video so we suggest checking that out if you haven't already. kzbin.info/www/bejne/fouUhKeniMt4l6c - Ste

[@simzou4373]

재테크 ETF 장단점과 아일랜드 ETF 🎉🎉

[@TheChosenKoala]

Thanks for the video lads, very helpful. First time investor here and currently looking into ETFs. Please forgive the silly question: In relation to when we buy, do we need to notify Revenue of this purchase? Or do we only need to worry about the tax side of things when we decide to sell?

[@TheLearningsReport]

Hey ChosenKoala, Thanks for watching! For purchasing, we don't think so. This pops up a bit but we haven't seen any regulation on it nor have Revenue confirmed to us yet. For selling, yes, you'll need to pay and file when you sell or else when the 8 year deemed disposal comes around. - Cian

[@Strum355]

@@TheLearningsReport section 4.1.1 seems to indicate that you should, but I've never heard of anyone doing so or revenue going after anyone www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-27/27-04-01.pdf

[@ronanodriscoll1343]

Great vid, thanks. I was looking at investing in ETFs but thinking twice now. The taxes in Ireland make no sense. In theory could someone who wanted to invest in an S&P 500 ETF decide to buy each stock individually to avoid those taxes and stay on the regular CGT rate?

[@TheLearningsReport]

Hey Ronan, cheers & appreciate the comment. Agreed, it's really quite frustrating how it's structured. Theoretically, yes, but there are a few caveats. You'd need to take into account the 'weighting' and 'rebalancing' of each holding in the index. Trying to do that yourself on an ongoing basis, for 500 companies, would be tricky. Vanguard can do it, but they have a few more resources! There may also be trading fees to consider, and many of those stocks in the S&P pay dividends, which would mean you'd have some work to do for tax season. (whereas with an ETF, you'd just have 'one' holding to do taxes on, instead of 500). It's a shame, because most investors SHOULD be invested in ETFs (as it makes the most sense), but then we're actively discouraged from doing it due to the tax incentives. - Ste

[@ronanodriscoll1343]

@@TheLearningsReport Thanks a mil for the reply Ste. I think it's safe to say even with the higher tax rate it still makes far more sense, the workload in rebalancing etc...would be ridiculous. Keep up the good work 👍

[@TheLearningsReport]

@@ronanodriscoll1343 Agreed!

[@peelo2311]

Hey lads, late to the party here. Great video.. I'm seeing info describing the difference between ETFs and Index funds. To me they're the same thing and you don't seem to mention in the video.. Is this right?

[@krispralea4745]

Great informative video, I thought tax would only be 15% on the likes of VUSA/VUAA because of the agreement between Ireland and the US?

[@TheLearningsReport]

Hey Kris, cheers for watching. So I think you're referring to the double taxation treaty that we have with the US when it comes to *dividends* . So 15% is withheld at source (usually by your broker if they have a W8-BEN form on file for you, which they probably do from when you signed up) and then you're required to pay the balance on your annual tax return (5% if you're usually taxed at 20% marginal income tax and 25% if you're at the higher 40%). In terms of the actual gains on your ETF investments, these are sadly still taxed at 41%. - Ste

[@krispralea4745]

@@TheLearningsReport thanks for the clarification, makes sense now.

[@TheLearningsReport]

No worries, Kris

[@seanmurphy789]

hi Guys. Great videos. very helpful. 2 questions if your don't mind. (1.) does stamp duty apply to EFT's? in particular the ETF you mention VUAA - is there stamp duty to this. (2.) you mentioned in another of your videos that if you sell stocks that you have to wait 30 days before purchasing them again. does this 30 day rule also apply to EFT's? thank you

[@TheLearningsReport]

Hey Sean, thanks for the question. 1) Stamp Duty is applied at 1% on Irish Share purchases (Irish Listed Companies) but not ETFs (to the best of our knowledge). 2) So the 30 day rule isn't relevant to ETFs, as the video which I assume you're referring to (Bed & Breakfast Sales) is a method to reduce your CGT liability by making sure you use your €1270 CGT exemption. But in Ireland, ETFs are not subject to CGT tax, they're subject to Exit Tax, so you couldn't use your €1270 to offset your ETF gains anyway - so 30 day rule doesn't really apply. - Ste

[@seanmurphy9587]

@@TheLearningsReport hi Ste. thanks for your reply. the reason i asked about the 30 day rule is because i am hoping to start investing into ETF's. the same amount of money each month for a number of years (basically to have money for my kids college: fees + accommodation/rent). am i correct in saying that after year eight i would have to file and pay deemed disposal of 41% EACH year (41% on year 1 purchases in year 9, 41% on year 2 purchases in year 10 etc). will this then get very messy if I get past year 16?? so i was wondering if at the end of year 8 i sold all my eft's and then paid the 41% exit tax on all 8 year purchases. then purchased them back. wouldn't this save me having to pay tax again for another 8 years? albeit i would be paying a high tax bill (8yrs in one go) to save the hassle of having to do it yearly or would this be a stupid idea as i would need to use some of my gains to pay the 41% and would i then lose out on compound interest for the next 8yrs

[@seanmurphy789]

@@seanmurphy9587 that the gains would make

[@TheLearningsReport]

@@seanmurphy9587 Hey Sean - so this is where we're not 100% on how its viewed by revenue. One way to look at it, is as you've described i.e. from year 8 onwards, you're basically paying deemed disposal every year assuming you're investing consistently over that first 8 yer period. The alternative way it could be viewed , is that, lets say you only buy shares of VUAA - and consistently add to that over the 8 years. In year 8 you'd pay deemed disposal on all gains up until that point. Then in year 16, you'd again pay on all profits generated between year 8 and 16 (adjusted for the taxes already paid), and so on. I've linked an article below that I believe supports the second scenario, but when it comes to details like this, we always suggest getting an answer in writing from revenue so that you have some fall back! www.bluewaterfp.ie/investments/calculating-deemed-disposal-on-a-long-term-investment/ - Ste

[@Aquivoy]

Great video! And back to the topic, are you telling me that if in 1 year my profits in ETF's (when selling) are €10,000, I should give away €4,100 in Taxes? Or even worse, if in 8 years I have earned €100,000, I should pay €41,000 in taxes even if I don't sell?... I must have misunderstood everything...

[@giovannimessina7124]

Hey guys, great as usual! one thing i am not clear on the deemed disposal. For the same etf, i don't understand if the deemed disposal is due only once after 8 years or every 8 years. Say, i buy an ETF in 2020 and keep it for 30 years, shall i pay deemed disposal on 2028, 2036, 2044 ? Could u point me to revenue documentation on this? i can't find it

[@TheLearningsReport]

Hey Giovanni - cheers for the comment! Yes, the tax is unfortunately due every 8 year period. Revenue documentation: www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-27/27-04-01.pdf Alternative blog post: www.bluewaterfp.ie/investments/calculating-deemed-disposal-on-a-long-term-investment/

[@johnrodgers2018]

Great video, so considering the Irish tax implications would it be an idea to put together your own 'etf' of value / aristocratic stocks? I know that this goes against conventional financial advice.

[@TheLearningsReport]

Hey John, Thanks for watching! I imagine setting up a financially regulated ETF would be fairly tough! 🤣 But, you can just buy the stocks of an ETF individually at the same weighting of the ETF and there are definite tax benefits here. You ultimately would be paying CGT at 33%, and you would get the annual exemption, be able to carry forward losses, etc. The main drawback is the time and effort it would take to manage the portfolio as ETFs are managed. Trading 212 actually have a function that allows you to do this easily called the pie function. We touch upon it in our T212 video which you can check out below if you're interested: kzbin.info/www/bejne/gHSkipeVYrmJoLM - Cian

[@johnrodgers2018]

@@TheLearningsReport oh no not another trading app! Thanks for the advice.

[@TheLearningsReport]

Haha fair. But yes, in short, your suggested method is feasible - but you’d just have a bit more work to do in terms of rebalancing etc. and likely wouldn’t offer the same level of diversification as a regular etf. You’d also need to manually reinvest dividends and pay the income tax on those upon receipt! - Ste

[@johnrodgers2018]

@@TheLearningsReport yup I'd lose diversification and increases risk and I do get that downside, but you make a good point again is there an option to automatically reinvest dividends so I wouldn't have to pay tax? Unrealised gains isn't it? Thx again

[@TheLearningsReport]

​@@johnrodgers2018 Your broker may offer a DRIP option (Dividend Reinvestment Plan) which will automatically reinvest dividends, but the important clarification here is that even with DRIP, you still actually need to pay the tax when you 'receive' the dividend i.e. when it's paid out (regardless if you reinvest automatically or not). This is where ETFs that re invest automatically have an advantage - you don't need to pay the tax when the dividend is paid, you just pay it when you sell the ETF (or when you cross the deemed disposal 8 year threshold). You don't 'skip' the payment, you just postpone it - which just makes things easier from a tax return standpoint. And again, for clarity, dividends are taxed at income tax rates (20 or 40%) plus USC & PRSI Hope this answers your question - Ste

[@Anonymous1169]

Hi guys, great video! Thanks! Just a quick question on VUAA. I note that it is listed on three exchanges (LSE [US$], XEF[€] and MIL[€]) and I was wondering if you had any advice in terms of the pros/cons of each exchange or if it really matters? Thanks Greg

[@TheLearningsReport]

Hey Greg - sorry for the late reply. In short, it shouldn't really - but if your account is in Euro, you may want to purchase on the euro denominated exchanges just to save on the conversion fees! Some brokers (depending on where they are located) also might charge a smaller or bigger fee depending on the market you are trading, so worth checking that too. - Ste

[@alessandrosordilli8404]

if you have DeGiro, some of the exchanges might be commissions free etf (initial charges fee, not ongoing), and that might drive the choice - check the free commission etf list

[@ianrockett]

Hi there. I’ve read that you can invest in US domiciled ETFs as long as you can access them via a US broker, or fund manager. I’ve also read that you can access an ETF like VOO via Tastyworks, and not be subject to deemed disposal every 8 years. Is this true? Equally, upon disposal, it is subject to CGT at the lower rate. This would have a massive implications for compounding potential. Would love to know your thoughts on this? Thanks, really like your content

[@TheLearningsReport]

Howiya Ian - cheers for the comment. Q1 - US domiciled ETFS: in short, everything I've read indicates that either we 'can't' invest in US etfs but there may be ways around it that I'm not aware of. Most US based brokers don't accept Irish clients (unless you have a US bank account, address, SSN, us phone number, etc.) so not sure how you'd go about that either (I used to live in the US and had an account with Robinhood). Never heard of Tastyworks until now, and no idea how it would allow you (legally) to avoid deemed disposal. So can't offer insights there! Your reference to 'lower rate of CGT' is also a bit misleading. I'm guessing thats a reference to the US based Capital Gains Tax rate (short term and long term rates) whereas in Ireland there is no lower rate of CGT (at time of writing). It's a blanket 33%. Thanks for the questions and glad you're enjoying the videos! I'll be looking into Tastyworks, cheers 👍 - Ste

[@karlcarthy4428]

Hey lads, what’s the difference with VUAA on the XEA exchange and the MIL exchange? Would you recommend one over the other?

[@TheLearningsReport]

Heya Karl. Not familiar with XEA - what country is that based out of? MIL is Milan anyway, but in short to answer your question, it shouldn't really matter. If EUR is your home currency, that's generally what you want to aim for with the exchange you choose. If they're both in EUR, it likely doesn't matter. Some exchanges have 'lower liquidity' but if you're buying an S&P 500 ETF such as VUAA, this will almost certainly be irrelevant as its one of the most liquid ETFs across all markets. - Ste

[@karlcarthy4428]

@@TheLearningsReport Cheers Ste. Apparently XET is the Xetra exchange based in Frankfurt. Both look to be in euro and both are accumulating so I can’t see any major differences between the two.

[@TheLearningsReport]

@@karlcarthy4428 Nice one - yes in that case, I wouldn't see any major difference between the two!

[@kaynft9702]

great vid guys would you say investing into ETF's as a form of 3rd string passive income even though the tax rate is so absurd on them?

[@TheLearningsReport]

Hey Kay - sorry for the late reply on this! Yes if your holdings are large enough and the ETFs you hold pay out a dividend, then absolutely they can be a great form of passive income. The same could be said for stocks in general though - as although it might not be 'consistent' passive income, the appreciation of the shares you hold over time can accumulate passively. (They can also depreciate passively also - as the markets have recently been showing us 😅) - Ste

[@williamryan6618]

Hi, am a new investor on etoro and have nearly 20 different stock and bond etfs(not big amounts) and am dollar cost averaging them until I work out which ones I really like once I've seen how taxes work etc. Am I mad? Will completing tax returns be a nightmare and could revenue charge a bigger accountancy fee? Brilliant videos thanks

[@TheLearningsReport]

Hey William, Welcome along the journey and thanks for watching! First mistake most investors make when starting is doing nothing so well done on diving straight in. Taxes are definitely a pain in Ireland. Most brokers keep records of transactions and gains per holding which takes a lot of pain out of the calculations. When reporting, you would just enter a total capital gain or dividend amount for the asset type e.g. all crypto/ stocks or all ETFs. We have loads of videos on how you can pay and file taxes in Ireland which you can check out here: Taxes in Ireland 💸: kzbin.info/aero/PLvKfba1wmPk_zQLVB9tHyqhwbY2b7d1jv And also, to confirm that both capital gains and dividends are self-assessed. You don't pay an accountancy fee to Revenue. - Cian

[@ilnam550]

Great video lads, subscribed now. Few questions please, 1) Do you have to declare annually how much you have invested in ETFs? There doesn't seem to be a place on form 12 for that, so im assuming you just have to declare and pay taxes on gains and dividends? 2) If selling ETFs and your gains were over 5k, does that push you from needing to use a form 12 to a form 11 for that year? Thanks

[@TheLearningsReport]

Hey II nam, Thanks for watching and excited to have you on the journey. 1) I'm presuming you are a non-chargeable individual (

[@ilnam550]

@@TheLearningsReport Hi Cian, thanks for the detailed response! Yea I am a non chargeable individual. 1) I will be investing in accumulating ETFs, so no dividends. And im going to sell before year 8 (and reinvest) to avoid going through that crappy DD rule, so i think the only time i will have to bother with these revenue forms is when i sell my shares and have to pay tax on any gains, is that right? 2) Thanks for that, so gains from selling ETFs aren't classed as non-PAYE income. So then its a form 12 or CG1 for the tax on the gains... revenue certainly aren't making this easy for us! Thanks for following up! Il try them myself aswell

[@TheLearningsReport]

@@ilnam550 no worries at all. 1) so you won't have to pay then until you sell but to clarify we're trying to figure out from Revenue if and how you declare ETF purchases. Apparently you have to declare the purchases but it is not clear where or how (of course!). We'll keep you posted. 2) So, to also clarify the tax treatment here it will depend on where your ETF I domiciled. If Ireland and EU, it is exit tax and yes we believe it is Form 12 and CG1 for that. If US, EEA and other OECD, it is CGT and Income tax which is Form 12 and CG1 form. This should cover the majority of them but if it's an offshore ETF it is just income tax, PRSI and USC which would just be Form 12. So, yes, Revenue makes it incredibly tricky to navigate 😂 Article here to explain further: www.irishtimes.com/business/personal-finance/don-t-invest-in-an-etf-until-you-understand-the-tax-1.3421331 Hope that clears it up, we'll keep you informed on what Revenue says about filing purchases. - Cian

[@ilnam550]

@@TheLearningsReport Thanks a million Cian, yes keep me posted if you hear back from revenue on that, cheers!

[@360GodlyInspirations]

VUG,is it accumulative or distributive

[@nateryan7041]

Is it possible to get in contact with you guys discuss etfs and how to invest the little bit more so I can try and understand better and start investing ASAP I really do appreciate the content it's very informative

[@TheLearningsReport]

Sorry for the late response - big summer off! Unfortunately we don't really offer 1:1 discussions, we just focus on the video content. Happy to try answer any questions you have here in the comments though :)

[@pereira025]

Great video, thank you! Can you please let me know if a resident non-domiciled in Ireland still has to comply with the 8 years deemed disposal rules? Does the answer change if one buys an Irish or US/EU ETF? Thanks for sharing your thoughts!

[@garymeehan9377]

Great video and very informative. If I made a profit on an EU domiciled ETF, I need to file a form 12 as stated. In the Non PAYE income section what would you file this under? Other foreign income including rents? Would this be where the 8 year deemed disposal is disclosed aswell? Slightly different question then. If you make a gain from an investment in an EU offshore investment fund, would this be filed in the same place as an ETF profits?

[@TheLearningsReport]

Hi Gary, Thanks a mill for watching. Great question. This is one that is also so unclear so I have raised an enquiry with Revenue and will circle back when I get a response. I would be hesitant to include it in other foreign income as Revenue will automatically calculate the tax on it and if you are in the higher bracket this could be up to 52%. But, we have previously checked with them on the Form 11 side which has a CG1/Capital Gains section. My sense, and let me confirm, is that you could file the profit using a CG1 form via my enquiries. For dividends, let me also check as these could be charged more than you should pay in the Other Foreign Income section. Sharing Revenue's response below to the Form 11 question: "Dear Cian, Please see the following Tax Duty Manual 27-02-01 to guide you with the declaration of your ETF : www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-27/27-02-01.pdf You enter any gains as well as deemed disposals of ETFs at the rate of 40% under the heading 'Offshore Funds' in the Foreign Income panel. Payment from or a disposal of an interest has to be included in the Form 11 for tax purposes." Also sharing a guide from the Irish Times explaining the different taxes that apply to different domiciles: www.irishtimes.com/business/personal-finance/don-t-invest-in-an-etf-until-you-understand-the-tax-1.3421331 I'll let you know what Revenue says. - Cian

[@premreginald]

Great Video. Im trying to understand the exit tax better. Im not an Ireland citizen. However, would like to invest in CSPX ETF as the dividend withholding tax is 15% compared to the US ETF equivalent. The country that I reside in does not have capital gain tax. Hence, in this case, would I be subjected to the 41% Exit Tax?

[@TheLearningsReport]

Hi Prem, thanks for watching! Good question, I gather that you are not resident in Ireland - are you domiciled in Ireland, however? If you are not resident or domiciled here, you may not owe tax in Ireland and it would be dependent on the country that you are domiciled in. From looking at a few blog posts, CSPX seems to be a popular ETF for Singaporean residents. It may be worth talking to a tax adviser to clarify given the international nature - sorry that we can't be more help here. - Cian

[@premreginald]

@@TheLearningsReport Thanks for your assistance. Yes, this ETF is very popular here and our financial advisor has not heard of the Exit Tax. So, thank you for the clarification. We will only be subjected to the 15% dividend withholding tax.

[@conorw4077]

Is the exit tax due from a sale of ETF shares filed and paid alongside CGT from the sale of singular shares or separately? And if seperately, are they filed under a different form than a CG1 for regular capital gains?

[@TheLearningsReport]

Hey Conor, Thanks for watching. I'm presuming you are a non-chargeable individual (

[@PriyankaAggarwal-fm4dx]

Does remittance basis apply to investments in ETFs? Answer for both EU and non EU etfs please.

[@oo7sam]

taxes are outrageous for what I get, is there any way to pay less tax like tax harvesting ?

[@TheLearningsReport]

Sorry for the late response - big summer off! Yea there's a strategy called bed & breakfast sale, we have a video on it if you want to give it a search 👌

[@zcadqe13]

Hi guys, thanks for the vid. One quick question - if you buy and hold accumulating ETFs, at what point do you inform revenue in order to pay the deemed disposal tax? When you purchase the ETFs? or only in the 8th year when the deemed disposal is due? Thanks

[@TheLearningsReport]

Hey Nick - no bother. On the 8th anniversary of whenever you made your first purchase! Technically you also need to notify revenue of when you purchase the ETF (no idea why) but I honestly don't know how much they care about this (not financial advice, etc etc. but yea, my opinion). You could probably sent message in my enquiries to notify if you wanted to. - Ste

[@zcadqe13]

@@TheLearningsReport thanks a mil!

[@gnvsem8640xnq]

Tks What is the ireland-domicile etf equivalent to schd pls ?

[@relaxbecalmtv2183]

Thanks lads for a n informative clear video. So the bottom line is that it's not worth investing in ETFs in Ireland because of the tax?

[@TheLearningsReport]

You're very welcome, glad it helped! The bottom line is...it depends 👀 The alternative is investing in individual stocks, which carries more risk and less diversification. ETFs as an investing instrument carry a lot of value for a retail investor due to their simplicity and instant diversification, but yes, the tax in Ireland is certainly prohibitive. You'd need to weigh up your returns. If you can consistently outperform the indexes over the long term, then yes, individual stocks might be better. But for many investors (including ourselves) that might not end up being the case, and even with the hefty tax, you might still come out better off if you just get the average market returns and let it compound for the next 20 years by investing in ETFs (granted, with deemed disposal - compounding is interrupted every 8 years. Lets hope this changes at some point.) There's also the option of investing in ETFs through your pension, and reducing your tax liability that way - so could be worth looking into that too. Hope that helps! - Ste

[@relaxbecalmtv2183]

@@TheLearningsReport Thank you so much for your reply. I really appreciate it.

[@TheLearningsReport]

No problem at all!

[@ninacee9140]

Thanks for the great video! How did this work for people who are living in Ireland temporarily and may move in the future - if they buy an EU etf whole in Ireland and subsequently move to another eu country or somewhere like the UK, would you still be liable for the Irish deemed disposal and 41% tax rate? In which case, would or perhaps make more sense to invest at a later point of you plan to become tax resident somewhere else that may have more favorable tax rules?

[@TheLearningsReport]

Hey Nina thanks for the question. In short, as deemed disposal and exit tax is specific to Ireland in this situation our understanding is that once you leave (for longer than the required time from a tax standpoint), you shouldn't be eligible to pay - at least not in Ireland, but you'll probably then owe tax wherever your new residence is, if applicable. (But we're not tax professionals etc etc. so definitely do your own checks on this! This is from our own research) Irish Tax Residence - you live in Ireland for more than 183 days from Jan to Dec or 280 days in the last two years, having spent at least 31 days in Ireland in each of the two tax years. Ordinarily Resident for tax purposes - you have been a tax resident in Ireland for 3 consecutive years. To the second part of your question, personally I wouldn't let that stop you from investing now. Although the tax implications are significant when living in Ireland, *time IN the market* nearly always trumps this, so I would advocate to just getting started and putting your money to work. Hope this somewhat helps with your question!

[@ninacee9140]

@@TheLearningsReport Thanks a mill for the reply, that's really helpful!

[@TheLearningsReport]

You're very welcome!

[@chluain1]

So does the deemed disposal rule every 8 years just kill any possibility for long term compound interest?

[@TheLearningsReport]

It has a huge detrimental effect. Theoretically, you could pay the deemed disposal out of pocket every 8 years and leave the ETF to grow but it's not going to be an easy sum to find every 8 years. Hopefully Revenue makes some changes soon! - Cian

[@mantingful]

HI ! May i know if the deemed disposable 8-year tax applies to overseas investors as well?

[@saramonacchi6447]

Great video! What happens if you are a foreign investor (non-irish citizen)? Assuming you decide to invest in an accumulating ETF while in Ireland, but then decide to move to a different country... do you still have to pay 41% to Ireland on the 8th year? Or do you have to declare your accumulated gains before leaving the country?

[@TheLearningsReport]

Hey Sara, thanks for that. This is a great question, and in short, I'm not 100% sure how its handled. It'll likely come down to tax residency, where you're domiciled, and how long you're out of Ireland when the deemed disposal anniversary occurs. Revenue's website states that you can still be taxed for up to 3 years after you leave Ireland in certain scenarios (link below for your reference) so that may apply to you depending on when you plan to leave Ireland again? www.revenue.ie/en/jobs-and-pensions/tax-residence/how-to-know-if-you-are-ordinarily-resident-for-tax-purposes.aspx This could be one thats worth sending revenue an enquiry about. They may also end up saying to consult a tax advisor though - but do let us know if you can get a clearer answer! Sorry we can't be of more help. - Ste

[@saramonacchi6447]

@@TheLearningsReport thanks for your answer I’ll check out the link! Great job these videos are so helpful and well done!

[@TheLearningsReport]

@@saramonacchi6447 glad you like them and thanks for watching. - Cian

[@ErikaMichielon]

@saramonacchi6447 Hi, did you find the answer to this?

[@saramonacchi6447]

@@ErikaMichielon as long as you change immediately your residence to the country you are living in then you have to follow the rules of the country you live in. If you don’t change your residency immediately, you are bonded to Irish laws for the two years after you leave (not 100% sure of the amount of time) so in short, make sure you keep your residency updated with the country you are living in so you can follow their rules.

[@darrenmcinerney2212]

Hi thanks very much great information, I have a question are you supposed to inform revenue first before you buy ETF Funds and also individual stocks or is it ok just to buy them and inform revenue every 8 years for ETFs, or when you sell individual stocks for taxes?

[@TheLearningsReport]

Hey Darren, Thanks for watching the video! Are you a chargeable individual (>€5k in non-PAYE income) or a non-chargeable individual (

[@darrenmcinerney2212]

Thanks very much Cian for your reply 👍👍👍.

[@TheLearningsReport]

@@darrenmcinerney2212 Just to clarify, you only need to notify revenue for ETF purchases, not for individual stock purchases 👍And to be honest, I haven't heard of anyone having issues with not declaring ETF purchases - the bigger issue would be of course if you just ignored the tax liability, then I'm sure they'd say something!

[@TheLearningsReport]

@x Hmm would be great to see the source. Please send on if you find it! In short, I haven't heard that myself (but that's not to say it isn't true). If in doubt, I'd just check with revenue via a myenquiries message. To be honest, the whole setup of declaring ETF purchases is a bit of a mess. I've heard of many people literally just sending a message to revenue on MyEnquiries declaring it 🤷‍♂

[@thomasmush]

Do you need to pay tax on the dividends as well as stock gain earned every year?

[@TheLearningsReport]

Hey Thomas, Thanks for watching. If the ETF is accumulating, you will only need to pay tax on dividends and gains when you sell the ETF or every 8 years for deemed disposal. If it is distributing, then you need to pay the earlier of tax every year on the dividends or when you sell and then pay on the gains when you sell or by the deemed disposal date. - Cian

[@TheLearningsReport]

And just to add (or clarify rather), tax on dividends - as it is seen as income, needs to be paid annually, but you will only need to pay the tax on the stock itself if/when you actually sell some of it. So hypothetically you could hold the stock forever without paying CGT, but you would still need to pay income tax on the dividend payouts annually.

[@thomasmush]

So I would have to pay dividends every year even if it is accumulating? Thanks

[@TheLearningsReport]

No sorry, if its an accumulating ETF then you won’t. If they’re distributed, then you will 👌🏼

[@missfavoured]

Is it possible to initiate the ETF investment in Europe and can adjust to the policy when moving outside Europe? Any brokers you can suggest?

[@TheLearningsReport]

Hey - when you say ‘adjust to the policy’ what exactly do you mean?

[@missfavoured]

@@TheLearningsReport Hi, I meant to follow the terms and conditions of the broker who could reside outside Europe/ Ireland.

[@TheLearningsReport]

@@missfavoured hey Favored, responded on your other comment but will copy here too in case you don't see it. Do you mean if you move outside of Europe or Ireland after investing in the ETFs in Ireland Europe? It would depend on where you are moving to but Interactive Brokers would probably be best for an international ETF long term investor. Plenty of countries available and ETFs available. They also removed the account fee recently so it is a great option for stocks too. You can also look at brokers where you can transfer your position out of the broker. It may cost money but at least you could move it to another broker if you move. - Cian

[@oliviamca6743]

For a beginner, would you suggest investing in an ETF or just investing in the company themselves? especially because of the tax regardless of if youre selling your ETF. Thanks in advance!

[@TheLearningsReport]

The age old question! If we remove the tax liability from the equation, then ETFs are great. Not just for beginners, but for everyone. Simply put, most people are better off investing in an ETF that tracks an index (e.g. S&P 500) and just dollar cost averaging into that for the next 20 years. Takes no thought, or work, or research. You can also do it through a pension and get tax benefits that way also. But of course, if you can beat the market (even by a % or two) over the long term, it can really add a significant amount to your long term wealth - hence why people also pick individual stocks. A standard recommendation would be to try both for a few years. Do some ETF investing, pick some individual stocks you're really passionate about or believe in. See how you perform over say 5 years. On average, how did your performance measure up with the index? If you beat it, good for you, maybe picking stocks is for you. If not, maybe you start weighting more of your investments to just index funds. But then there's Ireland. and Irish taxes. Deemed disposal and 41% exit tax is rough. For me, it's too bitter a pill to swallow so I focus on individual stocks. But if the rules changed (or I turn out to be really bad stock picker!) then I absolutely would either pivot or re-balance to include ETFs also! Hope this gives some guidance :) - Ste

[@discob69]

Looking for to buy DHHF ETF, and accumulating if possible. Would you recommend a certain stock broker?

[@VelcroKittie]

Very quick question and probably unrelated but you lads know your stuff. When you harvest a staked coin for the purpose of reinvesting back into the same staked coins, are we taxed on the harvest or just the realised profit (minus tax free allowance) when the coin is actually sold?

[@TheLearningsReport]

Heya, cheers as always for the comment. When you say harvest, we're just talking about you receiving the staking rewards, right? So lets say you're staking BNB on Binance. By staking, you receive say 7% return on your staked holdings. The 7% you receive is taxed (to the best of our knowledge) as income, and calculated based on the value of the tokens when you receive them. So to your question, the 'staking rewards' you receive are taxed at your marginal rate of income tax when you receive them, and then if you re-stake them and sell down the road, then you will be liable for CGT when you sell. Hope that helps! - Ste

[@VelcroKittie]

@@TheLearningsReport Thanks for getting back. That's really interesting. So essentially you are double taxed. It doesn't matter so much when the harvested coins are worth 9 cent or so, but if the price goes over $20, then harvested coins are going to really add up where income tax is concerned. The CGT on top of that if one chooses to stake is a but of a double whammy. They should count the income tax charged at point of harvest as an expense, thus increasing tax free allowance before realisation. The current set up will deter investors from reinvesting their coins once the market price of the coin reaches a certain level.

[@VelcroKittie]

@@TheLearningsReport Just another question. Say I harvest 1 coin worth €100. I pay income tax on this. I then restake that coin back into the same investment. That coin gains by €50: I am only paying Capital Gains Tax on €50 and not €150.

[@TheLearningsReport]

@@VelcroKittie it effectively is a lot of tax on the same process although Revenue would argue that they are separate events. We would hope that there are some changes coming but Revenue are usually slow with these things. So, in your example, you would pay income tax on the income received from the $100 (let's say this is 10% so $10). That's the first event. Then you can either 1. Sell the coin, which you would pay CGT on the $50 gain (not the $10 income, though) or 2. stake the coin again, on which you so would pay income on the staking rewards again. I say "either" because you can't stake coins you've sold but you can obviously sell some and stake some. - Cian

[@TheLearningsReport]

@@VelcroKittie have you seen our video on staking, btw? kzbin.info/www/bejne/l5mbl3pol5Voibs - Cian

[@theboom4438]

Great video! How does the tax rules change if investing through a CFD of an ETF?

[@TheLearningsReport]

Cheers for the comment! As far as we can see in the revenue documentation, CFDs are treated the same across the board i.e. 33% CGT. Although this sounds a lot better than the 41% you pay through non-cfd ETFs, you do need to factor in the much higher risk that trading CFD products entails - just to flag! - Ste

[@Kiwi_Ed]

Thanks for the videos, lads. They really clarify investing in Ireland. Just one question after this video: do you pay 41% ETF tax over the full value of your ETF or over the increase in value (profit)? It would be great if you can do a video comparing both forms of investing in Ireland and which one would be most profiable over a certain period of time. Thanks again, Ed

[@DAc2723]

Only taxed on profit

[@Kiwi_Ed]

@@DAc2723 thanks a lot.

[@Lily-ph4wm]

Thanks guys for the great video, very informative. Regarding deemed disposable tax every 8 years, will it incur on whole profit amounts every 8 years? i. e. If I make 10k profit in 8 years time, I'll have to pay 41% of 10k, then if I make 30k profit on the same ETF in 16 years, will I have to pay 41% of 30k profit OR 41% of 20k (considering that 10k was deemed to be disposed and paid 8 years ago)? Hope my question make sense!

[@TheLearningsReport]

Thanks Lily! Great question. No, you won't be taxed on the disposals you've already made. To save me the typing, I'm going to borrow Steven Barrett's (Bluewater Financial Planning) excellent example as it explains your exact question thoroughly 👍 www.bluewaterfp.ie/investments/calculating-deemed-disposal-on-a-long-term-investment/ Hope this helps! - Ste

[@Lily-ph4wm]

@@TheLearningsReport thanks a lot Ste, very helpful!

[@Lily-ph4wm]

@@TheLearningsReport one more question...! I'm trying to learn the tax implication difference between ETF and index funds. Would investments in index funds also apply to deemed disposal tax?

[@TheLearningsReport]

@@Lily-ph4wm So in Ireland, investing in an 'index fund' generally entails buying an ETF that tracks an index e.g. VUSA or VUAA which track the S&P 500. In the States they have more of a distinction between the two, but here (as far as I'm aware but happy to be proven wrong!) they're basically the same thing, and thus, are subject to deemed disposal 👍 - Ste

[@bubblesfw]

Hey lads, do ye have information on 60/40 investments? I searched for a video but could not find any. Plenty of other videos from different KZbinrs but I would be interested to know what ye think of the 60/40 approach! Thanks.

[@TheLearningsReport]

As in the 60% stocks 40% bonds approach? I personally would err far more on the stock side of things, especially as a younger investor with ( what I hope is) a fruitful and long investing life ahead of me. However, could still certainly look at doing a vid on it - so thanks for the suggestion. Haver you gone down the 60/40 route yourself?

[@bubblesfw]

@@TheLearningsReport Yes correct. 60% stocks and 40% bonds. Eoin McGee (Prosperous) recommends this type of approach. I am early 40s and researching how to invest for the future. But yes I would be thinking long term (minimum 10 years) and very diverse so I am thinking bonds may not be needed.

[@talalyousif3105]

Why DEGIRO and not trading 212 which has 0 commission?

[@TheLearningsReport]

When we published, Degiro had a far more extensive ETF list of securities. And furthermore, Trading 212 wasn’t accepting new customers 😊 We have since published a review of Trading 212 also, and it really comes down to your personal preference. Both are good! - Ste

[@talalyousif3105]

@@TheLearningsReport thanks

[@TheLearningsReport]

No worries

[@Clinicalsafety]

Great presentation guys, can I ask you about Capital gains tax with second property site. I bought a site in Wicklow for my retirement plan. I have a house in Dublin. Can I off-set planning permission costs from my CG tax?

[@Ankushkushwahachd]

This tax after 8 years for only Irish residents or for all European residents?

[@TheLearningsReport]

Hey Ankush, just Irish as far as I'm aware (unless other EU countries have their own rules around ETFs). - Ste

[@coreycunningham3467]

High lads, I know you're not intending to give financial advice on what to spend money on but weighing up all the factors. In your own opinion for someone looking to just drop a set amount in per month and have it accumulate, is the VUAA the handiest one to do that? Great video btw

[@TheLearningsReport]

Hey Corey - thanks a million for watching! Yeah, of course I have to preface this by saying that this is not financial advice or a recommendation but the Vanguard S&P 500 (i.e. VUAA) is one of the most popular ETFs globally. Over the course of it's existence, it has averaged 8-10% which is a pretty good ROI and much better than any savings account in Ireland. VUAA has the benefit of being an accumulating ETF. I have heard of a lot of passive investors going down this route but definitely do your own due diligence on the ETF and understand the risks. - Cian

[@louisacarroll1062]

Hi, Please can you help clarify: Every 8 years, “deemed disposal exit tax” is charged on the appreciation of your investment in an ETF in the previous 8 years. This is like a “prepayment” of tax. When you dispose of the investment, you pay exit tax on the appreciation of the investment since purchase less prepaid tax in the form of the sum of all the “deemed disposal exit tax” paid until disposal. Final exit tax is triggered by either: 1.). Sale of the investment Or 2.) Death of the share holder. If the ETF shares are held jointly and one of the joint share holders dies, does this trigger a Final Exit Tax event, even if the surviving joint share holder wants to continue to hold the ETF’s?

[@TheLearningsReport]

Hey Louisa - our understanding is that if the shares are held 'jointly' then no, a death of one shareholder would NOT trigger the 'final exit tax'.

[@OBLIVION20201]

I have invested in VOO on EToro, how does that work as a US domiciled ETF

[@TheLearningsReport]

Hey Robbie, on EToro, the ETFs are actually CFDs so you don't own the asset. For more information on CFDs, you can check here: www.etoro.com/investing/guides/fintech/understanding-cfd/ - Cian

[@OBLIVION20201]

@@TheLearningsReport Thanks Cian, what about VXUS, it’s not listed as a CFD on Etoro

[@TheLearningsReport]

Hmm, that's strange - on our screen, for the page breadcrumbs, it lists VXUS as Markets / ETFs / Financial / VXUS (CFD) - but you're right, when we go into the trade screen, it says you're buying the underlying asset (which to us is very misleading, and curious if its an error?). Gonna look to into it further, but in short - I don't know why that's the case! - Ste

[@TheLearningsReport]

Good catch btw

[@shalewhale]

Is there something like a Roth IRA in Ireland?

[@TheLearningsReport]

Hey Sahil, Thanks for watching! I don't think Ireland has a plan that is exactly like a Roth IRA however there are many tax incentives for pensions as a whole and you can withdraw a one-off tax-free lump sum upon retirement through many of the private pension plans. Luckily for you, we have recently published a video explaining all of this. :) You can check it out here: kzbin.info/www/bejne/a5PSp6R9rrR0eLs - Cian

[@davidfagan9080]

Hi guys, very informative. I am just wondering if invested in an etf, eg VUAA, do I need to do anything tax wise annually if I plan on holding long term or is it just a matter of paying the deemed disposal tax every 8 years?

[@TheLearningsReport]

Hey Dave, cheers for watching. Yes as you say, VUAA accumulates dividends so you’ll only need to worry about deemed disposal (or cgt if you sell of course). A solid move! - Ste

[@davidfagan9080]

@@TheLearningsReport Thanks Ste. Learned a lot from the channel already. Noted you speaking about using a trading 212 to replicate the s&p 500. Which in your opinion would be best for long term? I'm torn between the benefits of each

[@davidfagan9080]

** trading 212 pie

[@TheLearningsReport]

Glad to hear it! Thats a tricky one - its really up to you. I personally prefer picking individual stocks (at least for now) so my opinion is somewhat redundant. But: Main pro of etf: completely passive investing, and deep diversification (but higher taxes) Main pro of pie: no 41% tax (but less diversification as you wont be able to add 500 stocks and you’ll need to constantly monitor, etc.) You could do both if you wanted 🤷‍♂️ Put some money into a full S&P500 ETF and then make your own mini ETF with your favourite companies from the S&P 500. One will be more concentrated than the other, but would be interesting to see how each performs. Just an idea - as I said, the decision is personal so it’s up to you! - Ste

[@Seanniec95]

So basically after watching this investing in Ireland is a no go, that rental income would be the way to go?

[@TheLearningsReport]

Hey Sean, I wouldn't describe it as a "no-go", it really depends on your investment strategy. Compared to rental income, for some people it may be cheaper for tax. For example, if you are renting out a property, you could pay up to 52% at the highest band (vs. 41% Exit tax for ETFs). Stocks/cryptos are cheaper from a tax standpoint at 33%. Tax is an important consideration but certainly not the only one! - Cian

[@weijie9851]

The cons of paying tax at 41% is it referring to all countries or Irish people?

[@TheLearningsReport]

Hey Ang, thanks for the question. The 41% is specific to Ireland sadly!

[@weijie9851]

@@TheLearningsReport how about Singapore?

[@TheLearningsReport]

Unfortunately we have no idea what the ETF tax situation is in Singapore - but from our brief Google searches, there is no direct mention of ETF specific taxes in Singapore, so my guess would be that it follows your CGT rules (or lack thereof) i.e. you don't pay tax on your stock gains? As I said, not entirely sure - but thats what it looks like to me 🤷‍♂️ Cheers, - Ste

[@prabagaran.s1285]

Instead of etf , how to buy the s&p 500 index fund directly from US asset management company. Is there any options available to do that using interactive brokers or digero ?

[@TheLearningsReport]

Great question - I'm based in Ireland and use IBKR but I don't believe you can invest directly in an index fund (I could be wrong). As far as I'm aware, it's only through the ETF that we have access. Some of the old guard brokers (such as Goodbodys or Davys - maybe avoid Davys 😂) may offer some sort of direct investments, but in short, I don't know! - Ste

[@prabagaran.s1285]

@@TheLearningsReport thanks for the reply I am Indian , I am allowed to invest in Indian share market , so I have options to invest nassadaq and s&p 500 using fund of fund or etf with less tax bracket in India as a NRI But 40% Gains forgein investments, if we had gains in India share market , we need pay tax in India as an NRI and as well in Ireland as a forgein investments? My assumption Only India is enough Do you have insights on it.?

[@TheLearningsReport]

No real insights unfortunately - might be worth looking into dual tax treaties and what agreement Ireland and India have (if any) in that regard. Beautiful country though, both Cian and I (Ste) have spent time there, and loved it. I'm a shareholder in MMYT and a stock I really like!

[@prabagaran.s1285]

@@TheLearningsReport nice one 👍

[@missfavoured]

How can one invest into US stock (NVDA) on IBKR from Europe? The system asked to change the currency to USD from EUR. How does this work?

[@seanmcguire833]

It's probably covered in another comment but can you invest in etf's as a pension?

[@TheLearningsReport]

Hey Sean - yes, it depends on the pension provider though and what they can offer!

[@salehnawaz7233]

Can one open an account with documents from other country where he is national while being resident in ireland and avoid these heavey taxes ? It is nearly impossible to trade with these taxes in ireland

[@salehnawaz7233]

You guys are doing great job.. please keep it up it helps alot

[@TheLearningsReport]

Hey Saleh - Perhaps, but you're getting into a grey territory there that we can't really advise on. It would be lovely to be able to live in Ireland and pay taxes (or lack thereof) in other countries, but as you can guess that wouldn't be ideal from a government budget point of view! Q - Can you open an account with documents from another country? A - Probably, but there a lot of ifs and buts here that the individual broker will need to answer. Q - Avoiding the tax? A - Highly unlikely, and probably illegal 😂

[@brucelee7782]

This taxes only applies if you are from the EU or ireland right? They will not apply to those outside?

[@salimelawad]

how do I buy these from a USA brokerage?

[@jayadriantolentino]

Hi guys! Awesome content! Learned a ton from this. Quick question. Is the 41% tax applicable to non-irish citizens who are invested in irish-domiciled ETF’s?

[@TheLearningsReport]

Hi Jay - thanks for the comment and sorry for the delay in getting back to you on this. So in short, I'm not 100% certain - but my guess would be: unlikely. The 41% tax is Irish specific, and from what I can see from my research, non-residents sometimes choose to invest in Irish domiciled etfs to to avail of the lower dividend withholding tax rate on dividends (15%) due to our DTA with the United States, but I can't see any mention of non-residents needing to pay the 41%. Hope this helps, and if you hear anything to the contrary, please let us know! Cheers for watching - Ste

[@jayadriantolentino]

@@TheLearningsReport Alright! thanks for responding!

[@TheLearningsReport]

No worries 👍 Great content on your end btw - keep up the good work!

[@ministry_of_love]

An Irish domiciled ETF that is _traded_ in a stock Exchange within the EU (e.g. Frankfurt), would this be taxed as an Irish ETF or non Irish ETF?

[@IrishPimp92]

That taxation is insane.. 41% every 8 years... golleeee! Question. If i pay 41% on my earnings after 8 years.. the following 8 years am I taxed on the remaining 59% from the first 8 years plus the earnings for the following 8 years or just the earnings of the following 8 years? If not the latter then would it be better to take out the earnings just before the 8 years and reinvest assuming that all the investments are in an index fund? Great video.. Shit tax!

[@TheLearningsReport]

Hi Isaac - thanks for watching! Completely agree, the taxes are awful. So, to clarify, you pay 41% every 8 years on your gains. If I take a simple example, you buy €100 of an ETF and after 8 years it is valued at €200, meaning you have made a gain of €100. In this case with deemed disposal, you would have to pay €41 in tax but the €159 remaining is now your new principle/cost basis. If the value of that €159 goes up, you will pay tax again on the amount above the €159 but not on the €159 itself. So, to your question, it is just the earnings/gains of the following 8 years. Unfortunately, if you sell before the 8 years, you will still have to pay the 41% exit tax. Let's hope the lawmakers consider some changes to the high tax rates! - Cian