When/How/Should I notify Revenue of ETF purchases that occurred this year?

tax_moron

tax_moron

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I'm sorry if these questions keep cropping up, I can't find a straight answer to these.

I've bought and sold Irish domiciled ETF positions this year 2020 @ no chargeable gain, but it's not clear if, and how I let Revenue know about these purchases? Is it now in the 2020 year, or 2021?

I've also received dividends from these ETFs while holding them so again, when and how do I pay the tax on this at which I understand is 41%?

I've looked around the my revenue site, but nothing there related to ETFs, or ETF dividends. Perhaps I need to wait until the 2021 tax year to do these?

I've reached out to revenue but heard nothing back as of yet. Thanks in advance, sorry for my stupidity.
 
You're not stupid at all, if so that makes two of us ;-)

I have done same and have contacted them via their website as an enquiry, I still haven't receieved a response in nearly a week.

I believe you do have to inform them when you purchase an ETF / Shares. I also believe you file these returns with them in October 2021 as this years returns/losses have to be accounted for the year after purchase/sell. I too have looked around their site, there is not even a search facility which is poor.

And yes, etf's are taxed at 41% on any gains

Perhaps a much more knowledgeable person(s) can wade in here?

Ix
 
jpd said:
See here https://www.revenue.ie/en/tax-profe...ains-tax-corporation-tax/part-27/27-02-01.pdf

IN particular, section 5 on page 7
Click to expand...

Just to be clear, if I bought and sold ETFs in 2020, the Exit Tax is due in 2020 but reporting is on Form 11 submitted October 2021?

Do you have advice on how to calculate Exit Tax? I bought over a few months and sold all at once. Can I just average the price or if I bought 5 Units at 50 and 4 units at 60, and sold at 100 is my tax ((100-60)*0,41)*5 + (100-50)*0.41)*4?
 
So you meed to notify Revenue when you buy the funds - what if you are making regular purchases,
send them form 11 each time? Yeah right.
 
Here's what I understand, and it aligns with what others have said.

- ETF exit tax is 41% (this doesn't matter to me as I sold and bought in 2020 at a tenner loss)
- ETF dividend tax is also 41%, no USC or PRSI - but how to pay this? in which I'm assuming is due this current year 2020, in fact by the end of this month?
- Next tax year, 2021, I fill out my ETF purchases and sells on the Form 11 for the purchases I made in 2020

That sound about right?
 
It’s 2020 income so it gets reported and any tax is paid through the 2020 tax return, which is submitted in 2021.

As an aside, losses on one Irish ETF can’t be offset against gains on another, so the “I bought and sold ETFs at no chargeable gain” comment would concern me.
 
Gordon Gekko said:
As an aside, losses on one Irish ETF can’t be offset against gains on another, so the “I bought and sold ETFs at no chargeable gain” comment would concern me.
Click to expand...

It was the same ETF so all good. Cheers though!

edit: thanks also for your reply above!
 
When they say you have to inform revenue, does that mean for each purchase i.e. purchase the same etf every month I need to provide the 12 transactions to revenue or just the total amount for the year?

Seems like a very cumbersome process
 
irishguy said:
When they say you have to inform revenue, does that mean for each purchase i.e. purchase the same etf every month I need to provide the 12 transactions to revenue or just the total amount for the year?

Seems like a very cumbersome process
Click to expand...

Yes, that's what I understand anyway, but I won't be filing that until next year anyway.

I still haven't heard back from Revenue about my initial enquiry about how to actually pay tax owed this year. It's kind of frustrating to say the least.
 
tax_moron said:
I still haven't heard back from Revenue about my initial enquiry about how to actually pay tax owed this year. It's kind of frustrating to say the least.
Click to expand...
In fairness to Revenue it's an incredibly busy time of year for tax returns and enquiries, and they'd probably be of the view that they've made this info available publicly, it just wouldn't be scalable to deal with every individual's questions.

Anyway in-case you have not already seen them, you find these links useful, it's not an easy topic but with enough reading it's decipherable -
https://www.revenue.ie/en/tax-profe...ins-tax-corporation-tax/part-27/27-01a-03.pdf

https://www.revenue.ie/en/tax-profe...ins-tax-corporation-tax/part-27/27-01a-02.pdf

You might also take a look at this thread where there is a discussion on the correct sections of a Form11 to use when declaring ETF income/disposals/deemed-disposals - https://www.askaboutmoney.com/threads/etfs-taxation-issue.205550/page-2
 
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Thanks Zenith63, yeah I read that PDF.

I understand that I owe 41% tax on dividends received (yes I did buy a distributing ETF stupidly), and since I sold at a loss, I have no exit tax due... then I file a form 11 next year with the details, but I need to pay the tax basically in the next 2 days or so.

But how do I pay this to Revenue? None of their 'Make a Payment' options fit under this heading on my account... Like I know it isn't much, about €40 euro or something, but I just like to do everything above board, I just wish it was easier to do lol!
 
tax_moron said:
I understand that I owe 41% tax on dividends received (yes I did buy a distributing ETF stupidly), and since I sold at a loss, I have no exit tax due... then I file a form 11 next year with the details, but I need to pay the tax basically in the next 2 days or so.
Click to expand...
The income (dividends) and gain/loss were all in 2020 though right? In that case you will declare all of that on your 2020 tax return, which you would submit at some stage before October 2021.

Unless you regularly file a tax return and want to pay preliminary tax for 2020 or something like that?
 
Zenith63 said:
The income (dividends) and gain/loss were all in 2020 though right? In that case you will declare all of that on your 2020 tax return, which you would submit at some stage before October 2021.

Unless you regularly file a tax return and want to pay preliminary tax for 2020 or something like that?
Click to expand...

Correct was all inside 2020, and no this is my first time having to do additional tax stuff outside of normal PAYE stuff.

I thought I had to pay it much before the filing by next October though? I thought my ETF dividend tax was to be paid by October 31st of the year of receiving it.... or perhaps I'm getting confused as my username on this site is accurately being shown.
 
Not an expert so it would be great if somebody else can chip in, but I see no difference between when you would declare and pay income on gains vs. income from Irish domiciled ETFs and this would seem to be confirmed in the second document I linked to above -
an Irish resident unit holder will be subject to tax on income and gains arising and must self-assess and include details of income and gains in a timely filing on their income tax return to Revenue.
Click to expand...
 
Income tax on distributions from ETFs are due in the year following the distribution so tax on 2020 distributions are due by 31st oct 2021

However, preliminary tax for 2020 income is due by Dec 10 if paid online. But if you had no income other than PAYE in 2019, then no preliminary tax is due as your preliminary tax can be based on 100% of last year's tax. So you can relax and not worry about this till next Oct 2021

If you really want to pay it, enter a payment under preliminary Income tax 2020
 
Gordon Gekko said:
As an aside, losses on one Irish ETF can’t be offset against gains on another, so the “I bought and sold ETFs at no chargeable gain” comment would concern me.
Click to expand...

Do you have a link to confirm this? I've seen a few people say it, but I can't find anything on Revenue's site to confirm it. I'm hoping it's a Chinese whisper!
 
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