Returning citizen, query on taxes from disposal of shares

jabberwocky

Registered User
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Hi all,

I hope this is the right place to post this, my apologies if it is incorrect.

I am an Irish citizen, who has been working abroad for +10 years. I returned home before Covid and will be living (and eventually working) here for the foreseeable future.

I have not worked in Ireland in years, and since returning home I have been living off my savings and trading shares for some income. I have made approximately 10k through this activity.

My question is -- as this 10k is my only income, is it taxed as income, or taxed as capital gains? Revenue suggest that it is income, but in that case, I would be below the threshold for paying income tax anyway so I don't know if I need to even pay anything. Their service is not as informative or helpful as it once was and I have not been able to understand any further from speaking with them.

Many thanks everyone.
 
You will be tax resident in Ireland in 2020 if you were in the State for more than 183 days and it sounds, from your post, that this is the case. In that event you should be liable to income tax and capital gains tax in Ireland on your income. You will be liable to capital gains on the profit from trading shares and income tax on any dividend income you received. The latter may not be that relevant. You calculate your profit on the sale of shares and deduct any losses and pay 33% CGT on any amount over €1,270 which is your annual allowance.

You are unlikely to be regarded as being engaged in a trade of buying and selling shares unless you were doing a very high level of transactions. There is one U.K. tax appeal case that held that an individual 'day trader' had in excess of 300 trades in a year and was still liable to CGT and not income tax.

A word of caution - I'm assuming that you are buying and selling shares and not ETFs or other types of financial products. Generally speaking E.U. based ETFs are structured as a UCITS and taxed as an offshore fund. If you have been trading ETFs then the level of complexity rapidly increases and take a look at the ETF forum.
 
Thanks for the reply. Your assumptions were correct - I'm tax resident here and have not been trading ETFs.

That makes it quite clear for me. Much appreciated.
 
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