Investment 8th anniversary tax on form 11

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margaret1

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We have an investment with Irish Life ( previously Quinn). We have the complete original investment and the 8th year anniversary tax was deducted in Sept 2014. Would it be possible to advice if/where we record this transaction on form 11?
 
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Extract from revenue guidance document http://www.revenue.ie/en/about/publications/exchange-traded-funds-guidance-note.pdf

In general, income and gains included in payments made from an Irish-domiciled investment fund to investors are subject to deduction of tax at source by the fund at the rate of 41%, which is a final liability tax and is commonly referred to as ‘exit tax’.
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I don't think you have to include these on Form 11. There's a line 408 (a) Gain on deemed disposal but this is only if the investment manager has not deducted the exit tax, I think
 
I'd be 99% that Irish funds collect this tax themselves. The 8 year deemed disposal rule applies to offshore funds and I doubt that an Irish life fund is an offshore one.
 
jpd said:
I don't think you have to include these on Form 11. There's a line 408 (a) Gain on deemed disposal but this is only if the investment manager has not deducted the exit tax, I think
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That's correct. Irish Life are legally obliged to collect and remit the exit tax to Revenue on behalf of Irish resident investors. No need to report anything to Revenue.
 
Thanks for all of your replies. The Fund is a Euro QLD held with Irish Life, The tax was deducted by Irish Life at the current rate 41% in Sept 2014 on the taxable profit of the investment. It seems to be an advance payment to the revenue of the tax payable on any profit the investment made every 8th anniversary (finance act 2006). I thought I may need to record this on the 2014 tax return. Perhaps it is recorded instead at the time of fund encashment.
 
Does anybody know if you are resident in Ireland on the 8th anniversary of a policy but subsequently become non-resident and encash the policy, are you entitled to a refund on the tax paid on the 8th anniversary? My initial take is No, but then again the anniversary payment is described as an advance payment of the exit tax - which in this case would be zero.
 
I invested in a fund in Sept 2002, paid tax at 28% on the 8th anniversary in 2010, left the original premium plus gain after tax in the fund. Last week in Sept 2018 I paid tax on the gain at 41% on the gain. However the bank charged me 41% on the total gain over the 16 years less the tax I paid 8 years ago, in effect charging me 41% on the gain between 2002 and 2010.
Is this correct. Surely the gain the made after tax in 2010 should be part of the premium going forward.
 
The offshore fund area is a complex minefield and the only party who benefits from the confusion is the Revenue. It was introduced as an anti-avoidance provision to deal with obscure cases in 1990 and not extends to commonly used investments (ETFs, OEICs) that may not have existed at the time.

Two general comments in relation to the above points:
- to the best of my knowledge not all Irish funds automatically operate the 8 year deemed disposal rule. There was a relaxation about two/three years back, following lobbying from the funds industry, that has the effect of excluding the deemed disposal rules from certain Irish domiciled funds where a large proportion of fund holders were outside of Ireland. Irish Life may be okay and I'd suggest confirming the status with the provider. The deemed disposal rules still apply and any tax must be accounted for under the usual self assessment rules. I would stress that I'm not a FS tax specialist and I may have got this This post will be deleted if not edited to remove bad language about face but I do recall having to do something with this last year;
- the cost of the fund is rebased. For Scorpio 7453 your base cost is 2010 so only the gain between now and 2010 should be taxable.
 
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