P
Paspartu
Guest
Hi,
Im interested in investing in some funds. Rabodirect is very easy to use and has several funds to choose from.
Now, my question is about tax. I wish it was straightforward (maybe it is!) to claculate the tax you have to pay when investing in funds.
This is what the website says:
What are my tax obligations as a RaboDirect Investor?
Any idea if all funds offered by Rabodirect are Growth Funds??
What does the line "This compares favourably with investing, for example, directly in equities" really mean? What equities are they talking about?
Hope someone can add some good comments on this.
Thanks
Im interested in investing in some funds. Rabodirect is very easy to use and has several funds to choose from.
Now, my question is about tax. I wish it was straightforward (maybe it is!) to claculate the tax you have to pay when investing in funds.
This is what the website says:
What are my tax obligations as a RaboDirect Investor?
RaboDirect will not be responsible for making any tax deductions on investments. All investors are solely responsible for submitting their tax returns in line with current revenue requirements. Growth Funds operate on a roll-up basis for tax purposes. By investing through these Funds, you only pay tax on the realisation of your investment. You also pay tax on the increase in the value of the fund on the expiry of a period of 8 years from the date of the initial investment, and for each subsequent 8 year period. This only applies where there has been no realisation of you investment prior to the 8 year period. Where there is a realisation of your investment after the expiry of an 8 year period, a credit is available for the tax you paid on the expiry of the 8 year period against the tax you pay on the total gain on the realisation of you investment. The tax rate applicable is the standard rate of tax (currently 20 per cent) plus 3 per cent on any gains made on units in the funds.
You should note that this rate will apply only if you have included details of your gains correctly in your return of income made to your Inspector of Taxes; otherwise, the tax rate applicable will be your marginal rate of tax. This compares favourably with investing, for example, directly in equities. With direct equity investment you are liable each year to tax at the marginal rate (currently up to 42 per cent) on any income you receive from such investments. Your tax liability is deferred until you choose to dispose of your units and you are responsible for the payment of the tax to the Revenue Commissioners.
You should note that this rate will apply only if you have included details of your gains correctly in your return of income made to your Inspector of Taxes; otherwise, the tax rate applicable will be your marginal rate of tax. This compares favourably with investing, for example, directly in equities. With direct equity investment you are liable each year to tax at the marginal rate (currently up to 42 per cent) on any income you receive from such investments. Your tax liability is deferred until you choose to dispose of your units and you are responsible for the payment of the tax to the Revenue Commissioners.
Any idea if all funds offered by Rabodirect are Growth Funds??
What does the line "This compares favourably with investing, for example, directly in equities" really mean? What equities are they talking about?
Hope someone can add some good comments on this.
Thanks