ETFs: A few basic questions

[Louisval]

1. What are the typical total charges p.a.?
2. What are the reporting requirements at a high level?
3. For someone who is not interested in buying a basket of individual shares, are ETFs generally felt to be a better option than a typically unit-linked insurance company type offering?

 

[Persia]

What are the typical total charges p.a.?

I pay 0.07% annually for a vanguard accumulating etf.

You can pay more you can pay less.Research before committing.

 

[Louisval]

Thanks Persia,

Is this a passive ETF? What's the benchmark? Are there any entry charges?

 

[Persia]

No entry charges and Lightyear don't charge for ETF purchase iirc.

I have an S&P500 etf, absolutely no way would I try and manage buying and watching 7 or 8 individual shares, iI don't have either the experience or time and would get scalped.

 

[ClubMan]

What are the reporting requirements at a high level?

What do you mean by this?

 

[Louisval]

@ClubMan - sorry for being unclear. I meant tax reporting requirements at a high level so what records does one need to keep and anything else one should know to avoid trouble!

 

[Protocol]

Is this a passive ETF? What's the benchmark? Are there any entry charges?

I have bought shares in a passive index-tracking ETF on DeGiro.

The commission fee on each purchase is 1 euro.

The AMC is 0.20%.

There are no other charges, well except that DeGiro charges 2.50 per year for each foreign exchange that you have holdings on.

 

[ClubMan]

I meant tax reporting requirements at a high level so what records does one need to keep and anything else one should know to avoid trouble!

There are several threads dealing with this issue already. E.g.:

Google Search

 

[Shannb1]

are ETFs generally felt to be a better option than a typically unit-linked insurance company type offering?

If you don’t need advice then mostly yes -they are cheaper & more transparent than the life assurance products. Tax-wise for Irish residents, they both fall under our exit tax regime with the 41% rate, but there's an important administrative difference: for life assurance products, the provider calculates, deducts, and pays the tax on your behalf at the 8-year mark or on encashment. With ETFs, you need to self-assess and report this tax yourself through the self assessment system (Form 11). Also if the fund isn’t domiciled in Ireland you technically need to declare this to the revenue after you buy (in Form 11 as well).

You will see from researching that this whole area can get very complex and it generates lots of debate. That said, I’d be hopeful that the tax regime will have changed by the time 8 years comes around or you sell… so buy now I say!