# US ETFs no longer purchasable in Europe



## Boyd (22 Dec 2017)

I just saw this on boards, might be of interest to people on here:


> Hi,
> This week I had the following message from my uk broker
> 
> "New regulation being introduced on 1 January 2018 will affect dealing in some of your holdings.The new regulation requires that issuers of certain types of investments (known as ‘Packaged Retail Investment and Insurance Products’or ‘PRIIPs’) must publish a Key Information Document (or KID) if they are available to private investors.Without a KID, private investors will not be able to make any further purchases in that stock, although they can continue to hold the PRIIPs they already own. They can also sell at any stage."
> ...


https://www.boards.ie/vbulletin/showthread.php?t=2057822332

An interesting development indeed....


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## fistophobia (22 Dec 2017)

If this is official, and across European brokers, then the game is up.
Revenue will be laughing their head off.


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## joe sod (31 Dec 2017)

I have a US etrade account so maybe will not be affected yet. At least it shows that they are not able to tax US domiciled etfs the same as euro domiciled ones, all they can do is make it more difficult for irish investors to buy them. So there must be alot of irish investors now investing in US domiciled etfs if revenue are now honing in on it. Irish investors can still buy UK investment trusts anyway as an alternative vehicle with similar tax advantages


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## joe sod (31 Dec 2017)

double post, mistake


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## Jim2007 (31 Dec 2017)

fistophobia said:


> If this is official, and across European brokers, then the game is up.
> Revenue will be laughing their head off.



Brokers can on promote funds without the required KID etc... That does not meant that you cannot buy them if they are quoted on an exchange you have access to.


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## Sarenco (2 Jan 2018)

One of the largest brokers in the UK has now removed US-domiciled ETFs from its platform as a result of the PRIIPs Regulation.  It will be interesting to see if brokers here follow suit.

https://www.professionaladviser.com...mplementation-temporarily-removes-some-trusts


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## yggdrasil (2 Jan 2018)

It looks like they're gone from DeGiro too...


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## Sarenco (2 Jan 2018)

yggdrasil said:


> It looks like they're gone from DeGiro too...


Interesting.  I guess they didn't have much of a choice the way the Regulation is drafted.


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## Jim2007 (3 Jan 2018)

Sarenco said:


> Interesting.  I guess they didn't have much of a choice the way the Regulation is drafted.



Do you have access to the US markets?  Can you get a quote using the ETF ticker?


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## Sarenco (3 Jan 2018)

Jim2007 said:


> Do you have access to the US markets?  Can you get a quote using the ETF ticker?


I'm not currently seeking to purchase any US-domiciled ETFs.


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## Sarenco (3 Jan 2018)

Confirmation that Davy and DeGiro have pulled US-domiciled ETFs from their platforms due to PRIIPs Regulation.

https://www.irishtimes.com/business...rs-from-certain-foreign-investments-1.3343801


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## Sarenco (4 Jan 2018)

IT commentary on the impact of the PRIIPs Regulation -

https://www.irishtimes.com/business...aper-jam-stalling-new-product-sales-1.3344380


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## Sherman (9 Jan 2018)

Vanguard have confirmed to me they will not be producing KIIDs for US-listed ETFs, which means that we will effectively be left with no option but to invest in UCITS ETFs, and suffer Revenue's lunatic rules on deemed disposal, if we want access to liquid, diversified international equities investments. Great little country in which to save for the future, eh?


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## galway_blow_in (9 Jan 2018)

Sherman said:


> Vanguard have confirmed to me they will not be producing KIIDs for US-listed ETFs, which means that we will effectively be left with no option but to invest in UCITS ETFs, and suffer Revenue's lunatic rules on deemed disposal, if we want access to liquid, diversified international equities investments. Great little country in which to save for the future, eh?



and the experts tell us property is such a poor investment compared to stocks ?

it is but not in ireland in many cases !


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## jabberwocky (9 Jan 2018)

It's a little surprising how quiet it has been on this subject. We've effectively been shut out of the market, and are forced to either invest via the Irish pension system, or into ridiculously-taxed UCITS funds.

There must be more than a handful of us impacted by this change -- what are the rest of you doing?

I see in the boards thread a couple of people considering opening up accounts with US-based brokers, is that really the only way out of this bureaucratic quagmire?


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## Sarenco (9 Jan 2018)

Have you looked at listed UK investment trusts? 

Something like Foreign & Colonial Investment Trust plc holds a globally diversified equity portfolio, has a reasonable TER and is subject to the normal income tax/CGT regime. 

Alternatively, where appropriate, just maintain a higher equity allocation in your pension fund and pay off any debts/keep your after-tax savings on deposit.  It's important to consider all your accounts as a whole.


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## jabberwocky (9 Jan 2018)

Hi Sarenco,

Thank you very much, I had not looked into FRCL but I will do so.

Are all UK investment trusts subject to our normal income tax/CGT? It's the 8-year deemed disposal I am trying to avoid, as I want to hold these for 25+ years, all going well.


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## Sarenco (10 Jan 2018)

Hi Jabberwocky

The tax treatment of UK investment trusts has previously been discussed on quite a few threads in the "investments" sub-forum.


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## RobFer (10 Jan 2018)

Sherman said:


> Vanguard have confirmed to me they will not be producing KIIDs for US-listed ETFs, which means that we will effectively be left with no option but to invest in UCITS ETFs, and suffer Revenue's lunatic rules on deemed disposal, if we want access to liquid, diversified international equities investments. Great little country in which to save for the future, eh?


Does that mean they lose out on customers from across Europe and Canada? It would be great if some paper high lighted the issues and explained why making KIIDs is such an obstacle.


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## keane2097 (10 Jan 2018)

Just waiting it out at the moment, hoping one of the companies will come good with the documentation needed.

Will be opening a US brokerage account otherwise more than likely.


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## Gordon Gekko (10 Jan 2018)

keane2097 said:


> Just waiting it out at the moment, hoping one of the companies will come good with the documentation needed.
> 
> Will be opening a US brokerage account otherwise more than likely.



Beware of US estate tax issues in that case...


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## keane2097 (10 Jan 2018)

Gordon Gekko said:


> Beware of US estate tax issues in that case...



Yeah another reason why I'm waiting is to give time for people to run into/bring up issues like that. Thanks for the tip.


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## galway_blow_in (10 Jan 2018)

forgive my ignorance but its one thing not being able to buy anymore , will those of us who currently own u.s domiciled etf funds be forced to close out our positions ?

ive over 150 k stuck in two of these things

they are

VEA
EZU


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## keane2097 (10 Jan 2018)

No you can continue to hold them.


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## orka (10 Jan 2018)

RobFer said:


> Does that mean they lose out on customers from across Europe and Canada?


No. My understanding is that Vanguard sells equivalent ETFs which are Europe-domiciled (generally in Ireland) so customers can buy those instead and get the same (pre-tax) returns.  So for most European customers who are taxed the same way on US and European ETFs, there is no major difference so this change is not a big deal anywhere else - which is probably why Vanguard and others can't be bothered producing the documentation just for the Irish audience when the rest of Europe is happy to switch to similar but Europe-domiciled ETFs.


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## Sherman (10 Jan 2018)

orka said:


> No. My understanding is that Vanguard sells equivalent ETFs which are Europe-domiciled (generally in Ireland) so customers can buy those instead and get the same (pre-tax) returns.  So for most European customers who are taxed the same way on US and European ETFs, there is no major difference so this change is not a big deal anywhere else - which is probably why Vanguard and others can't be bothered producing the documentation just for the Irish audience when the rest of Europe is happy to switch to similar but Europe-domiciled ETFs.



If anything there's probably an incentive for Vanguard, iShares etc. not to bother - the TERs for their UCITS ETFs are generally higher than equivalent US-domiciled ETFs they offer, so they make more although in fairness it's probably more expensive to comply with the UCITS regime. The EU ETF market would also be, at a guess, significantly smaller than the US market, so they don't get the same economies of scale.


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## AJAM (10 Jan 2018)

How about we set up a petition to ask the government to scrap the crazy tax rules?


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## joe sod (10 Jan 2018)

AJAM said:


> How about we set up a petition to ask the government to scrap the crazy tax rules?


 good luck with that one, if they made any slight change to benefit investors saving for the rainy day, they would have every sinn fein td along with ruth coppinger et al jumping up and down


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## Dardania (11 Jan 2018)

AJAM said:


> How about we set up a petition to ask the government to scrap the crazy tax rules?





joe sod said:


> good luck with that one, if they made any slight change to benefit investors saving for the rainy day, they would have every sinn fein td along with ruth coppinger et al jumping up and down



I've been thinking about this a lot lately - if it was framed in a way to say that the current housing crisis is partially due to the tax regime, it might fall on a sympatheitc ear. 

e.g. current Irish tax policy discourages people from saving for the future using equities in the stock markets, investment funds etc., and instead encourages people to invest in property. In order to see reasonable gains it involves price gouging of their fellow citizens and neighbours, rather than taking a fair dividend from multinationals. Reform the tax approach to make it fairer to people who want to save for the future, and free up residential property for purchase by first time buyers and professional high quality REITs.


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## Sarenco (11 Jan 2018)

Dardania said:


> current Irish tax policy ... encourages people to invest in property.


I don't think everybody would agree with that conclusion -
https://www.askaboutmoney.com/threads/tax-take-on-rental-income-is-staggering.200198/


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## Sherman (11 Jan 2018)

Sarenco said:


> I don't think everybody would agree with that conclusion -
> https://www.askaboutmoney.com/threads/tax-take-on-rental-income-is-staggering.200198/



Good point. Maybe it's fairer to say that current Irish tax policy discourages any form of personal responsibility or attempts to better one's position in life by discouraging saving, investing, self-employment/entrepreneurship and trying to increase one's income. Ironically we seem to be perfectly happy to encourage vested wealth with our no CGT on PPRs, and our comparatively generous inheritance tax allowances.

It's almost as if economic and tax policy was being set by a bunch of former teachers and landowners, and by civil servants with guaranteed pensions...


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## RETIRED2017 (11 Jan 2018)

Sherman said:


> Good point. Maybe it's fairer to say that current Irish tax policy discourages any form of personal responsibility or attempts to better one's position in life by discouraging saving, investing, self-employment/entrepreneurship and trying to increase one's income. Ironically we seem to be perfectly happy to encourage vested wealth with our no CGT on PPRs, and our comparatively generous inheritance tax allowances.
> 
> It's almost as if economic and tax policy was being set by a bunch of former teachers and landowners, and by civil servants with guaranteed pensions...



That is a fair statement all tax policy is built around vested lobby groups,Whole industries have grown up  around economic and tax policy.We are now beginning to see the results of the changes made to guaranteed pensions in 1995,

 The people now taking over are beginning to target the very same groups there predecessor protected and you can already hear the whinging starting,

A lot of what was given away will now have to be taken back .
New landlords along with other groups are paying the price ,

2008 was a watershed people took a very close look at how they were treated the first chance they got the took there revenge any  politicians that survived know the game is up


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## RETIRED2017 (11 Jan 2018)

joe sod said:


> good luck with that one, if they made any slight change to benefit investors saving for the rainy day, they would have every sinn fein td along with ruth coppinger et al jumping up and down


I don't like the policies of sinn fein or Ruth Coppinger ,I don't think they make one bit of difference to government tax policy they fear the earned income taxpayer more than the fear the unearned income  tax payer   who vote ff/fg/ labour/Independents,

 A section of there own supporters are keeping a better eye on them than Ruth or Gerry and can/will do more about it when the time comes,


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## Gordon Gekko (11 Jan 2018)

Tax policy encourages people to invest in pensions but they don’t.

Pensions are extraordinarily attractive from a tax perspective.


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## RETIRED2017 (11 Jan 2018)

Gordon Gekko said:


> Tax policy encourages people to invest in pensions but they don’t.
> 
> Pensions are extraordinarily attractive from a tax perspective.



Very interesting times ahead as government policy moves for everyone earning income? to pay into pension,


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## Gordon Gekko (11 Jan 2018)

RETIRED2017 said:


> Very interesting times ahead as government policy moves for everyone earning income? to pay into pension,



Potentially.

My concern is that prudent folk who are currently paying into a pension will somehow be rogered and made to pay for the recklessness of others.


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## RETIRED2017 (11 Jan 2018)

Gordon Gekko said:


> Potentially.
> 
> My concern is that prudent folk who are currently paying into a pension will somehow be rogered and made to pay for the recklessness of others.


And the sad part is FF/FG/Labour are after there votes watch this space,These are the parties who hold clinics every week to look after the reckless in return for there vote,The power struggle now is between FF and FG on who is going to look after this group the best and get there vote for a change FG are winning this battle hands down,


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## joe sod (11 Jan 2018)

Gordon Gekko said:


> Potentially.
> 
> My concern is that prudent folk who are currently paying into a pension will somehow be rogered and made to pay for the recklessness of others.


 
You mean that the state pension will be denied to people with private pension above a certain level even if they paid  PRSI all their working lives.


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## RETIRED2017 (11 Jan 2018)

joe sod said:


> You mean that the state pension will be denied to people with private pension above a certain level even if they paid  PRSI all their working lives.





joe sod said:


> You mean that the state pension will be denied to people with private pension above a certain level even if they paid  PRSI all their working lives.


I don't believe any government will ever again take on  the prsi paying paye taxpayer I am old enough to remember what started the tax marches back in 1982
when the government of the day increased prsi from around 15% to 19.1% it was payable on all low income then ,If any of you are old enough to remember this is why tax prsi relief on income tax was brought in to try get prsi paying taxpayers back on side.

another reason why they will never ever be able to touch paye paying taxpayers prsi pension is because in 1995 when they brought in the new public service pension the deal that was struck between unions and goverment  was the government makes up the shortfall between the prsi pension and 50 %of final salary if they had full service

 We in the private sector have a lot to thank the public sector for ,

no way would they be able to take it off one group paying the same prsi just because one is a private pension not a hope in hell of any government trying that one on they know who they will be dealing with they still have nightmares from 1982 they main parties never fully recovered since prsi workers took to the streets back in 1982,
It was the start of the floating Vote all of the main parties are now chasing,

The main parties have two sets of core supporters one set  vote them in and pay the most tax high earners and people with unearned income they then take there tax and feed it to there other core group/supporters who want to pay for nothing,

The people who brought  in the changes were paying less than 2% prsi under another prsi band in 1982 and were still paying 2% until  the USC came in 2012/13

I just  checked prsi rates for 1982  went from 14.8% to 19.1% of paye income/payroll in the private sector


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## Gordon Gekko (12 Jan 2018)

joe sod said:


> You mean that the state pension will be denied to people with private pension above a certain level even if they paid  PRSI all their working lives.



Potentially; or a pension levy style land-grab against people with decent private pensions to pay for the recklessness of others.


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## Dardania (12 Jan 2018)

Gordon Gekko said:


> Potentially; or a pension levy style land-grab against people with decent private pensions to pay for the recklessness of others.


Could definitely see this happening - it could be as sly as requiring PRSI contributions when retired to maintain health care eligibility, with means testing to define the rate of payment.

I'm hopeful this initiative gains steam, so I can get my pension the hell out of Ireland: https://www.ft.com/content/731a27b4-5cb0-11e7-b553-e2df1b0c3220


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## RETIRED2017 (12 Jan 2018)

Dardania said:


> Could definitely see this happening - it could be as sly as requiring PRSI contributions when retired to maintain health care eligibility, with means testing to define the rate of payment.
> 
> I'm hopeful this initiative gains steam, so I can get my pension the hell out of Ireland: https://www.ft.com/content/731a27b4-5cb0-11e7-b553-e2df1b0c3220


Is USC paid on pension Don't hear much about FG promise in the last election to get rid of it,


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## Gordon Gekko (12 Jan 2018)

RETIRED2017 said:


> Is USC paid on pension Don't hear much about FG promise in the last election to get rid of it,



There no relief from USC on the way in, and you pay USC on the way out.

So not great in other words!


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## RETIRED2017 (12 Jan 2018)

Gordon Gekko said:


> There no relief from USC on the way in, and you pay USC on the way out.
> 
> So not great in other words!


I am very interested in seeing how Leo handles this at one stage he was on for putting USC  in with PRSI it did not happen in the budget so they are already creaming extra from pensions by not doing so

Leo pension will be post 1995 he is paying the higher PRSI ,
A lot of the tax breaks in the past were designed so people in the private sector could have a pension every bit as good as the public sector if the took advantage of the tax breaks,


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## AJAM (12 Jan 2018)

I think I am going to start a petition. I'd appreciate a bit of feed back on the text below, especially if I've made any errors.

Petition to Scrap the 41% Exit Tax on Investment Funds and Replace it with Capital Gains Tax

Ireland is one of the leading regulated domiciles for internationally distributed investment funds and exchange traded funds (ETF's). The Irish tax regime has been, and continues to be, one of the key growth drivers of the funds industry in Ireland. The Irish tax treatment of these funds encourages big institutional investors and small individual off-shore investors across the world to use Irish domiciled funds, which, as a result, has seen billions of euro flow into them.
The one group who don't benefit from this is small Irish Investors. The current tax treatment of UCTIS ETF's and other unit linked funds means small Irish investors must pay 41% tax on any gains that they realize from their investments. This compares prohibitively to investing in individual stocks where the capital gains rate of 33% applies.
Furthermore investors in individual stocks can offset losses against gains, while ETF investors can not, leaving them at a significant disadvantage. i.e. if you invest in 2 ETF's and one has loss and one a gain, you must pay tax on the gain and get no benefit from the loss. On top of this ETF investors must pay the 41% tax after 8 years, whether or not they sell their investment, under the again overly-complicated "deemed disposal" rule.
Low cost, broadly diversified exchange traded funds (ETFs) are the best way for ordinary people to get access to and benefit from the stock market. However the current Irish tax treatment completely discourages investment in diversified ETF's and encourages investment in risky single stocks. This can be seen in revenues own figures as the tax take from exit tax is falling (as investors flee these products) while the tax take from Capital gains is rising.
The current, overly-complicated unit exit tax system should be scrapped and replaced with capital gains tax giving a fair, level playing field for all investors.


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## RETIRED2017 (12 Jan 2018)

AJAM said:


> I think I am going to start a petition. I'd appreciate a bit of feed back on the text below, especially if I've made any errors.
> 
> Petition to Scrap the 41% Exit Tax on Investment Funds and Replace it with Capital Gains Tax
> 
> ...




Dirt rate Budget 2017 down from 41% to 33% Do you know was there any pre- budget submissions along the lines you are suggesting,


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## Sarenco (12 Jan 2018)

@AJAM

That all looks accurate to me.  

Fair play to you and best of luck with this exercise.


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## Sarenco (12 Jan 2018)

RETIRED2017 said:


> Dirt rate Budget 2017 down from 41% to 33%


Eh, DIRT in 2018 is not levied @33% - it's levied @37%.  It's not scheduled to reduce to 33% until 2020.

Regardless, exit tax is still levied at 41%.


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## RETIRED2017 (12 Jan 2018)

Sarenco said:


> Eh, DIRT in 2018 is not levied @33% - it's levied @37%.  It's not scheduled to reduce to 33% until 2020.
> 
> Regardless, exit tax is still levied at 41%.


thanks for the correction on dirt tax


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## Sarenco (12 Jan 2018)

No problem - and apologies if I sounded a bit snarky.  

FWIW I think it's outrageous that DIRT hasn't been (and apparently won't be) reduced to the standard rate of income tax.  

Why should a pensioner (or anybody else for that matter) with a modest income have to pay DIRT @37% (or 33% for that matter)?


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## Protocol (12 Jan 2018)

People over 65 who are exempt from income tax don't pay DIRT.

18/36k limits.


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## galway_blow_in (12 Jan 2018)

Sarenco said:


> No problem - and apologies if I sounded a bit snarky.
> 
> FWIW I think it's outrageous that DIRT hasn't been (and apparently won't be) reduced to the standard rate of income tax.
> 
> Why should a pensioner (or anybody else for that matter) with a modest income have to pay DIRT @37% (or 33% for that matter)?



They ( pensioners) dont !


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## fistophobia (13 Jan 2018)

There was a pre-budget submission on the exit tax, think it was by the Life Insurance body LIA.
I think it would be more effective if pressure came from the funds industry itself, such as IFIA.
Really, private investors dont stand a chance by making such requests - would be seen as elitist.


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## AJAM (13 Jan 2018)

I get your point, but I don't think it's elitist at all. Elites have tax advisers who can off shore these types of problems away. This is trying to give ordinary Joe a fair crack at the whip. It's more likely to be seen as aspirational! Although in Ireland, this may be seen as even worse than elitism!

Look, we've a minority government, their ability to ignore the public is probably the lowest it might ever be. If we get a couple of thousand signatures, it could be enough to force them to at least think about it.
If you're not it, you can't win.


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## Sarenco (13 Jan 2018)

galway_blow_in said:


> They ( pensioners) dont !


They do unless they are over 65 and their total income is below the annual exemption limit.


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## galway_blow_in (13 Jan 2018)

Sarenco said:


> They do unless they are over 65 and their total income is below the annual exemption limit.



well i thought you meant low income pensioners who would nearly always be over 65 when in receipt of pensions , i wouldnt be too concerned about a guard who retired in his fifties and got hit with the full DIRT tax , ditto with any other public servant on a fat pension


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## Dardania (18 Jan 2018)

On topic: https://www.irishtimes.com/news/soc...d-be-reviewed-to-address-inequality-1.3359361


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## RETIRED2017 (18 Jan 2018)

RETIRED2017 said:


> I don't believe any government will ever again take on  the prsi paying paye taxpayer I am old enough to remember what started the tax marches back in 1982
> when the government of the day increased prsi from around 15% to 19.1% it was payable on all low income then ,If any of you are old enough to remember this is why tax prsi relief on income tax was brought in to try get prsi paying taxpayers back on side.
> 
> another reason why they will never ever be able to touch paye paying taxpayers prsi pension is because in 1995 when they brought in the new public service pension the deal that was struck between unions and goverment  was the government makes up the shortfall between the prsi pension and 50 %of final salary if they had full service
> ...





Dardania said:


> On topic: https://www.irishtimes.com/news/soc...d-be-reviewed-to-address-inequality-1.3359361



I will be watching  how this situation plays out ,I think I seen Joe Costello from Labour on the clip shown on rte news last night he was in the background I think,


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## settlement (18 Jan 2018)

This post will be deleted if not edited immediately. That slid in under the radar. What motivated this? It seems it's not just Ireland, all of Europe.


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## joe sod (18 Jan 2018)

"Tax breaks to “wealthy individuals” who take out private pensions should be “reviewed” as one measure to address inequalities in the State pension introduced six years ago, according to a coalition of older people’s and women’s organisations."

a quote from the article, at this rate Ireland will be more socialist than Scandinavia but there will be nobody left to pay for it. Ireland pays out among the highest social welfare payments in europe. Alot of the tax to pay for this  actually comes from corporation tax that the government gets from the US multinationals. Therefore ireland internationally is the most capitalist of all european countries in order to grab as much corporate tax as possible to pay for the most socialist of welfare systems. However this may not last much longer with european governments about to grab their share of this. If they try and do this (abolish pension tax break) there will be a mass exodus of high net worth and skilled workers out of ireland


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## Gordon Gekko (18 Jan 2018)

Ludicrous.

Punish people who work hard (as usual) to fund the ignorance, laziness, and lack of personal responsibility of others.

“I was forced to leave the civil service so I don’t get a fat juicy defined benefit pension...let’s make these other unconnected people pay.”

Why didn’t she go and work somewhere else? Why was it a shock when Citizens Information websites etc have the info?

How much of a fiddle went on over the years in terms of farming, grants, management of income downwards?

This narrative is horse manure.


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## RETIRED2017 (18 Jan 2018)

Gordon Gekko said:


> Ludicrous.
> 
> Punish people who work hard (as usual) to fund the ignorance, laziness, and lack of personal responsibility of others.
> 
> ...



I don't go along with the first line there are a lot of hardworking people on low wages who up to a few years ago paid very high prsi and high tax this was work that needed to be done there are hardworking people paying no tax and hardworking people paying very high tax on there income in this country,

We are beginning to see the result of the change to public servants pensions  in 1995 and the pension levy starting to feed into private sector tax relief ,

The minister in charge of the state contribution pension and the minister for finance and the pressure group are all saying it is unfair

The reason this will get through is people are focusing on the pressure groups  and allowing the minister for finance to pick there pockets for a few extra votes knowing well high paying taxpayers will always vote FG/FF,


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## Mez! (31 Jan 2018)

See below for a response I received from Blackrock UK when I asked if they plan to release a KIID for US domiciled ETF’s.


_Certain US iShares ETFs are registered under Article 42 of AIFMD in the United Kingdom, Luxembourg, Sweden, Finland and the Netherlands which allow for marketing to professional investors in these countries. In addition, fund manufacturers are now required under MIFID II to make a target market assessment for each product sold to EEA investors. BlackRock has assessed the target market for these products as being suitable for professional investors only to align with their AIFMD registrations. Fund manufacturers (and distributors) are required to provide a PRIIPs KID or UCITS KIID to retail EEA investors prior to the point of purchase. If no KID/KIID is available, then the product cannot be sold to a retail investor in the EEA from 1 January 2018.


Since these US iShares ETFs have only been registered under AIFMD for marketing to professional investors (and currently may not be marketed to retail investors), BlackRock has not produced PRIIPs KIDs for these US iShares ETFs.


Any US iShares ETFs that have not been registered in an EEA jurisdiction should not be marketed in such EEA jurisdiction.


If fund distributors were selling these US iShares ETFs to retail investors in the EEA before the start of this year, they will now need to stop selling to retail investors since PRIIPs KIDs are not available for these US iShares ETFs. In any case, as these US iShares ETFs are treated as complex products under MiFID II, distributors would have needed to carry out appropriateness tests in order to continue to sell them to EEA retail investors.


All of the Irish domiciled iShares exchange traded products have target markets that include retail investors and we have made UCITS KIIDs available for the Irish iShares ETFs and PRIIPs KIDs available for the Irish iShares ETCs. 


For example, *iShares MSCI EMU UCITS ETF*(CEU) is available for individual investors in the UK. This is the same fund as EZU, tracking the same benchmark. _


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## Sarenco (31 Jan 2018)

To summarise, BlackRock's US-domiciled funds and ETFs will no longer be offered to retail investors in the EU due to regulatory hurdles.

To be fair, EU-domiciled funds have never been available to retail investor in the US for the same reason.


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## SreudianFlip (1 Feb 2018)

After realizing I can no longer buy US ETFs on degiro, I'm just getting up to speed on all this now.. I can't believe what I'm reading - It seems to me that all this PRIIPS KIDS stuff is a heavily disguised robbery of US market share of ETFs by the EU (presuming most EU retail investors will now switch to UCITS ETFs). And as somebody mentioned, the ETF providers are only too happy to let it happen for the higher margins. 

So on the one hand the Irish domiciled funds industry stands to gain trillions from these MiFID2 rules, but on the other hand Irish resident ETF investors like ourselves are now shafted with deemed disposals and 41% Nonsense tax. All the while we'll be pilloried again by our EU counterparts for further enabling tax avoidance.

This all slipped by far too easily.. Surely Irish investors are not the only heavily affected? Any other EU countries with this insufferable UCITS tax setup?

Where do I sign this petition? The law must change.


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## Sarenco (1 Feb 2018)

In general, US-domiciled ETFs don't suit EU investors because they are required by US law to distribute essentially all income and capital gains (which are subject to high rates of income tax in most EU Member States).

PRIIPs & MiFID II really have nothing to do with economic protectionism.

The Irish tax regime is entirely an Irish competence - you need to lobby your local TDs if you want to see a change in the current regime.


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## SreudianFlip (1 Feb 2018)

Sarenco said:


> The Irish tax regime is entirely an Irish competence - you need to lobby your local TDs if you want to see a change in the current regime.



An Irish incompetence* 
I wrote to my local TDs about a year ago on this issue and didn't even get courtesy replies.. The problem is that most of these acronyms just go over people's heads. Will have to find a way to frame it in the sense that small-time savers looking for a return are being unfairly taxed. 

Regarding the deemed disposal provision.. If one were to become tax resident elsewhere for the maturity of the 8 years of their ETF holdings... Upon return, does deemed disposal kick-in or reset or what would be the case I wonder?


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## MrEarl (1 Feb 2018)

SreudianFlip said:


> ....Irish resident ETF investors like ourselves are now shafted with deemed disposals and 41% Nonsense tax. ...





Sarenco said:


> ....The Irish tax regime is entirely an Irish competence - you need to lobby your local TDs if you want to see a change in the current regime.





SreudianFlip said:


> An Irish incompetence*
> I wrote to my local TDs about a year ago on this issue and didn't even get courtesy replies.. The problem is that most of these acronyms just go over people's heads. Will have to find a way to frame it in the sense that small-time savers looking for a return are being unfairly taxed. ....




More and more of us need to start putting pressure on our politicians, if we want this tax rule changed.

Emails to the Minister for Finance and copying local TDs calling for change, emails to our local TD's asking them to raise the matter as a question to the Minister for Finance in the Dail, are ways of going about it.  But like everything else, the politicians often need a good kick in the a$$ to get them moving.


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## SreudianFlip (6 Feb 2018)

Vanguard confirmed the following and seem to have no intention of providing KID documents:



> "With effect from the 3rd January 2018 MIFID II and PRIIPs regulations require various additional disclosures for European regulated funds. Vanguard’s US domiciled ETFs are approved and regulated by the SEC which has different disclosure requirements to those stipulated by MiFID II and PRIIPs. As Vanguard’s US domiciled products are not registered in Europe under AIFMD, these products are not actively marketed in Europe. Therefore, Vanguard does not provide PRIIP KIDs or the transaction costs, ongoing charges and target market analysis for our US domiciled ETFs and will not be able to make these available.
> 
> We understand that some investors are very disappointed with the above, however as you know, our range of European domiciled equity and fixed income ETFs are fully compliant with MIFID II and PRIIPs and remain available to European investors through distributors.  Each of these products will be supported with the appropriate UCITS KIIDs. Please also note that there is no requirement for UCITS funds to produce PRIIP KIDs until Jan 2020."



Furthermore, DEGIRO confirmed that the US ETFs will be unavailable on their platform until such time that the issuers provide KIDs.

So it seems that US ETFs will be unavailable indefinitely unless a broker creates KIDs themselves or one of the issuers provide the documents.

Vanguard stand to lose a lot of Irish investors (drop in the ocean of course), considering that none of their available EU ETFs are accumulating..

It seems confirmed - we are limited to EU-only ETFs for the foreseeable future. The only course of action remaining as I see it is to apply pressure to change the tax law in Ireland to provide specifically for ETFs being CGT-eligible rather than Exit tax.


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## BryanMM (12 Feb 2018)

The consequence of this for US citizens living in the EU seems to be terrible. They can't invest in EU domiciled ETFs because those are prohibitively taxed by the US tax authorities as PFICs. They can't invest in European EFTs for the reasons explained above.

Have I got this right. Any knowledgeable person care to opine?


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## BryanMM (12 Feb 2018)

Thanks for the helpful reply Marc. I'm not in the 500K league or anything like it. Realistically what kind of minimum investment figure am I looking at to make it worthwhile to retain you as a Discretionary Portfolio Manager, for both a monthly investment and a total investment.


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## Sarenco (15 Feb 2018)

AJAM said:


> I think I am going to start a petition.


Hi AJAM

I was wondering if you found the time to follow through on this idea? 

I'm sure there are plenty of contributors and readers here that would welcome an opportunity to sign such a petition.


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## RETIRED2017 (15 Feb 2018)

Sarenco said:


> Hi AJAM
> 
> I was wondering if you found the time to follow through on this idea?
> 
> I'm sure there are plenty of contributors and readers here that would welcome an opportunity to sign such a petition.


 
Unless you target the party in power It is a waste of time, The people you would be targeting to sign are there supporters,


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## Gordon Gekko (15 Feb 2018)

As I understand it, this has already happened and people will be allowed to continue to invest in US ETFs.

There have been a number of submissions made to the authorities.

With regard to the tax piece, I despise the complexity of the regime as much as the next man; however there is some logic to the punitive tax treatment of funds that just roll up their income all ad infinitum. The State gets nowt in such circumstances. Revenue were happy to concede on the US ETFs because they have to distribute income. If a fund distributes, it should be subject to CGT.


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## Sarenco (15 Feb 2018)

Marc said:


> They can continue to access a portfolio of US ETFs via a Professional Investor service which is exempt from providing KID documents



Professional investors (per se or opt-up) can continue to invest in PRIIPs (including US-domiciled ETFs) without a KID being provided but, in practice, investment firms are very slow to re-classify retail investors as professional investors for good reason.


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## Hayman (9 Sep 2018)

What was the reply here, it seems to have been cleared away?


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## Hayman (9 Sep 2018)

I mean from Marc.....thanks


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