Withdrawing profits from ETF yearly a sensible idea?

[ontopoftheworld]

@elladig46 Does that mean tax in ETF earnings can be offset against tax if you contribute those earnings to your pension

 

[elladig46]

@ontopoftheworld Yes, in an indirect kind of way they can

If you are paying 40% tax on employment or self employed income you could use the etf profits to top up your pension.

You're still paying 40% tax on the ETF profit but you've generated a corresponding tax refund on your employment income

Is that what you mean?

 

[ontopoftheworld]

@elladig46 Thanks for that.

That’s correct.

I currently put a hefty amount into my pension (self administered) paid directly via my own company. However, if I could make tax free contributions from my ETF gains, I would do this.

It would mean I could leave more profits in the company which I’d use for expansion.

I’m actually annoyed that I never thought to structure it this way as I’ve actively being avoiding ETFs due to how they’re taxed.

 

[matthew1423]

@thesartist I’d also love to know whether taking the €1,270 gain out every year is the most tax & gain efficient way of maximizing returns over time.