Deemed disposal now applied to non EU i.e. US domiciled ETFS?

[whovianpastorswife13]

I just read that Revenue have updated policy to make the 41% exit tax and 8 year deemed disposal tax applicable to non EU domiciled ETFs.

I'm trying to find the official Revenue statement/document. Has anyone came across anything official confirming this?

Yet another illustration of how regressive the Irish goverment is. How very dare you attempt to build your wealth, back in your box.

 

[teatimebabe28]

@whovianpastorswife13 What do they have against ETFs?

 

[whovianpastorswife13]

@teatimebabe28 It's an easy win for them. I'm waiting on some archaic policy being introduced around crypto holdings in coming years as it gains proper mainstream adoption.

 

[mellyyy]

@whovianpastorswife13 At which point i will be moving country.

 

[ojr]

@mellyyy You will still have CGT liability until you have been non-resident for 5 years. That’s a long time.

 

[mellyyy]

@ojr What? That's insane.

Even if i became a tax resident of another country in that time?

 

[ojr]

@mellyyy Sorry, I looked it up, it’s 3 years. And yes, even if you become tax resident in another country.

 

[pjv]

@ojr How can they even enforce these ridiculous rules if you are in another country? Like if you emigrated for good there is little they can do

 

[999forever]

@pjv I don't think that's true.

Or at least not completely. If you move to another country and are fully tax compliant there you don't have a liability.

If you move and aren't then you do. If you pay tax somewhere your OK. If you inten to pay it nowhere then you're liable.

 

[ojr]

@pjv I guess it depends where you go and it depends if you ever want to be able to come back into the country.

 

[sakura2015]

@pjv Someone snitches on you.

 

[sakura2015]

@ojr 3 years

 

[pearlsamuel]

@whovianpastorswife13 No, they have not. This was discussed at length on this Reddit a few months back when the revenue doc was first updated. Do a search for those threads.

 

[whovianpastorswife13]

@pearlsamuel See below article but not seen this mentioned elsewhere.

https://www.bluewaterfp.ie/investments/deemed-disposal/

"A further update – on 1 September 2021, the Revenue revised their guidance and from 1 January 2022, non EU domicile ETFs are now subject to exit tax at 41% and deemed disposal."

 

[pearlsamuel]

@whovianpastorswife13 Ya, that's wrong. Revenue removed a blanket statement they used have stating that all non-EU domiciled ETF's are treated as shares as it would have caused issues with UK based ones post-Brexit and replaced/updated the definition of equivalent and non-equivalent ETF's. Non-equivalent ETF's are still not subject to exit tax.

 

[whovianpastorswife13]

@pearlsamuel Thanks for the reference, appreciate that. It's so frustrating how ambiguous the whole landscape is, reflected in fact even tax professionals don't seem to be able to give a categorical answer.

 

[pearlsamuel]

@whovianpastorswife13 Blue Water wouldn't be a tax professional, just financial advisor. If you go to Ask about money ETF forum, another FA mentions the advice they got from a tax expert: Post in thread 'Revenue E-Brief on ETFs' https://www.askaboutmoney.com/threads/revenue-e-brief-on-etfs.224674/post-1735666

 

[pearlsamuel]

@whovianpastorswife13 See:

https://www.reddit.com/r/irishpersonalfinance/comments/phsowp

 

[harkness]

@pearlsamuel Appreciate we engaged on this before. Our firm recently discussed this with Big 4 firm on mutual client. Their understanding is this is US ETFs are moving to offshore fund treatment. Not arguing with your point as I think they’re very valid - but just wanted to call that out to you!

 

[pearlsamuel]

@harkness See: Post in thread 'Revenue E-Brief on ETFs' https://www.askaboutmoney.com/threads/revenue-e-brief-on-etfs.224674/post-1735666 maybe risk that investment trusts become offshore funds as they pass the test for a unit being redeemed within the fund, but ETF's no.

I think it takes a very specific type of professional to review this and many don't have the knowledge. US ETF's don't pass the bar to be equivalent to EU ones.