Brokerage Margin Interest. Is It a qualifying expense?

[DMartin]

Share brokerage platforms often provide margin loan options to facilitate trades and charge interest for the service. Would this "brokerage applied" interest qualify as one of the brokerage charges/fees that can be deducted from profits from share sales? Is there any guidance on this in Ireland from official sources?

 

[Steven Barrett]

It's not an expense that can be deducted.

 

[AAAContributor]

Is there any guidance on this in Ireland from official sources?

Yes.

The legislation is clear on this.

Section 552(3)(b) TCA provides that an individual may not claim a CGT deduction for interest paid on funds borrowed to acquire an asset (shares in this case).

 

[Gordon Gekko]

You’d have to be ‘trading’ in order to qualify for a deduction, which is a very high bar indeed, and there are also interest elements within CFDs that can be deductible, but the simple answer that @Steven Barrett and @AAAContributor have given, i.e. ‘No’, is correct.

 

[DMartin]

thanks all. pretty clear from what you say.