thecoffeepod
Registered User
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- 260
Hi all
Seeking feedback on this but as a foundation I'm happy to share and for other posters to use and/or amend
It may help others in their day to day work or interactions.
(Be kind)
Simple Question version
Quick CGT vs Deemed Disposal Check
Question: "Is my investment subject to CGT or deemed disposal rules?"
---
Thank you for your enquiry. I can help you determine this quickly.
Please answer these three simple questions:
---
QUESTION 1: What are you investing in?
Direct shares in a company (e.g., Apple, Microsoft)
Property
Bonds
= CGT at 33% (You're done - no 8-year rule)
A fund (unit trust, UCITS, mutual fund, investment company)
= Go to Question 2
---
QUESTION 2: Where is the fund located?
Outside EU/EEA/OECD (e.g., Cayman Islands)
= Seek professional advice (different rules)
Inside EU/EEA/OECD
= Go to Question 3
---
QUESTION 3: Is it a UCITS fund or similar to Irish regulated funds?
Quick check - Does it have:
- Regulatory approval in its home country? YES/NO
- A prospectus or key information document? YES/NO
- Diversification rules? YES/NO
- Public availability (not private/restricted)? YES/NO
Mostly YES answers
= Deemed disposal at 38% (with 8-year rule)
Mostly NO answers
= CGT at 33% (no 8-year rule)
---
CRITICAL WARNING:
Can you personally influence or direct what the fund invests in?
YES = PPIU at 60% (extremely punitive - avoid if possible!)
NO = Standard rates apply as above
---
Summary Table:
Investment Type Tax Rate 8-Year Rule? Loss Relief?
Direct shares/property 33% CGT No Yes
UCITS/equivalent fund 38% Yes No
Non-equivalent fund 33% CGT No Yes
PPIU (personal influence) 60% Yes No
---
Your answer: Based on the questions above, your investment is most likely:
[ ] CGT at 33% - tax only when you sell
[ ] Deemed disposal at 38% - tax every 8 years + when you sell
[ ] PPIU at 60% - avoid this arrangement if possible
---
Important:
- You must report all offshore investments on Form 11
- If unsure or investing a significant amount, seek professional tax advice
- Getting this wrong can be very costly
--------------
Detailed version
Thank you for your enquiry about [X investment].
To determine whether this investment is subject to Capital Gains Tax (CGT) or the deemed disposal rules, I'll need to gather some information about the investment.
Please work through the questions below, and the decision tree will guide you to the answer.
---
Please answer the following questions about [X investment]:
Question 1: What type of investment is it?
- [ ] A fund (unit trust, UCITS, investment company, mutual fund, SICAV, etc.)
- [ ] Direct shares in a company
- [ ] Property
- [ ] Bonds/fixed income securities
- [ ] Other (please specify)
Question 2: Where is it located/domiciled?
- [ ] Ireland
- [ ] EU country (please specify: _________)
- [ ] EEA country (Norway, Iceland, Liechtenstein)
- [ ] OECD country with Irish tax treaty (e.g., UK, US, Switzerland)
- [ ] Other location (please specify: _________)
If it's a FUND, please answer these additional questions:
Question 3: Is it regulated and by whom?
- [ ] Yes - regulated by [insert regulator name, e.g., Central Bank, FCA, AMF]
- [ ] No - not regulated
- [ ] Don't know
Question 4: What type of fund structure is it?
- [ ] UCITS (Undertaking for Collective Investment in Transferable Securities)
- [ ] Unit trust
- [ ] Investment company/SICAV/ICAV
- [ ] Alternative Investment Fund (AIF)
- [ ] Hedge fund
- [ ] Private equity fund
- [ ] Investment limited partnership
- [ ] Don't know
Question 5: Does it have these characteristics?
- [ ] Publicly available to investors (not private/restricted)
- [ ] Has a prospectus or key information document
- [ ] Has diversification rules (can't put all money in one asset)
- [ ] Has a depositary/custodian holding the assets
- [ ] Regular regulatory reporting requirements
Question 6: CRITICAL - Can you personally influence what the fund invests in?
- [ ] No - the fund manager makes all investment decisions
- [ ] Yes - I can direct or influence investment choices
- [ ] Partially - I have some input on investment strategy
---
DECISION TREE - Follow the steps below:
STEP 1: Is it a FUND or a DIRECT INVESTMENT?
→ If it's DIRECT SHARES, PROPERTY, or BONDS (not held through a fund):
YOUR ANSWER: Capital Gains Tax (CGT) at 33%
- Tax only when you sell
- No 8-year deemed disposal
- Can offset losses against other gains
- €1,270 annual CGT exemption applies
- STOP HERE - this is your answer
→ If it's a FUND (unit trust, UCITS, mutual fund, investment company, SICAV, etc.):
Go to STEP 2
---
STEP 2: Where is the fund located?
→ If OUTSIDE the EU/EEA/OECD (e.g., Cayman Islands, Jersey, Guernsey):
Different rules apply - seek professional advice immediately
STOP HERE
→ If INSIDE the EU/EEA/OECD:
Go to STEP 3
---
STEP 3: Is it similar to an Irish regulated fund?
Ask yourself these questions:
A. Is it a UCITS fund?
B. Is it structured as a unit trust?
C. Is it an investment company with similar rules to Irish Part XIII companies?
D. Does it have a depositary/custodian?
E. Does it issue a prospectus or key information document?
F. Does it have diversification rules?
G. Is it publicly available (not a private arrangement)?
H. Is it regulated by the country's financial regulator?
→ If you answered YES to MOST (5 or more) of the above:
This is likely an "EQUIVALENT FUND"
Go to STEP 4
→ If you answered NO to MOST of the above:
This is likely a "NON-EQUIVALENT FUND"
YOUR ANSWER: Capital Gains Tax (CGT) at 33%
- Normal income tax on dividends/distributions
- CGT at 33% when you sell
- No 8-year deemed disposal
- Can offset losses against other gains
- Must still report on Form 11 under "Other Offshore Products"
- STOP HERE - this is your answer
---
STEP 4: Can you personally influence the fund's investments?
This is CRITICAL - be honest:
→ NO - The fund manager makes ALL investment decisions without your input:
YOUR ANSWER: Deemed Disposal Rules at 38%
- Tax at 38% on payments and gains
- 8-year deemed disposal applies (automatic tax every 8 years)
- Must file Form 11 annually under "Offshore Funds (Part 27 Ch 4)"
- NO loss relief available
- STOP HERE - this is your answer
→ YES - You CAN direct or influence what the fund invests in:
YOUR ANSWER: PPIU (Personal Portfolio Investment Undertaking) at 60%
- Tax at 60% on payments and gains (80% if not reported correctly!)
- 8-year deemed disposal applies
- Must file Form 11 annually
- NO loss relief available
- **STRONGLY CONSIDER AVOIDING THIS INVESTMENT**
- Seek professional advice before proceeding
- STOP HERE - this is your answer
---
Based on the decision tree above, your investment [X] is most likely subject to:
CGT at 33% if:
- It's a direct investment (shares, property), OR
- It's a non-equivalent fund
Deemed Disposal at 38% if:
- It's an equivalent fund (UCITS, similar unit trust/investment company)
- You cannot influence investments
[ ] Deemed Disposal at 60% (PPIU)if:
- It's any fund where you can personally direct investments
---
| Your Investment Type | Tax Treatment | Rate | 8-Year Rule? |
|---------------------|---------------|------|--------------|
| Direct shares (any company) | CGT | 33% | No |
| Direct property | CGT | 33% | No |
| UCITS fund (EU/EEA) | Deemed disposal | 38% | Yes |
| Irish unit trust | Deemed disposal | 38% | Yes |
| Non-equivalent offshore fund | CGT | 33% | No |
| Any fund you can influence | Deemed disposal | 60% | Yes (PPIU) |
---
If you're still unsure:
1. Check the fund's prospectus or key information document
2. Look for terms like "UCITS", "AIF", "regulated fund"
3. Check if it's listed on the fund provider's website as equivalent to Irish funds
4. Contact the fund provider directly and ask if it's an "equivalent fund" for Irish tax purposes
Seeking feedback on this but as a foundation I'm happy to share and for other posters to use and/or amend
It may help others in their day to day work or interactions.
(Be kind)
Simple Question version
Quick CGT vs Deemed Disposal Check
Question: "Is my investment subject to CGT or deemed disposal rules?"
---
Thank you for your enquiry. I can help you determine this quickly.
Please answer these three simple questions:
---
QUESTION 1: What are you investing in?
Direct shares in a company (e.g., Apple, Microsoft)
Property
Bonds
= CGT at 33% (You're done - no 8-year rule)
A fund (unit trust, UCITS, mutual fund, investment company)
= Go to Question 2
---
QUESTION 2: Where is the fund located?
Outside EU/EEA/OECD (e.g., Cayman Islands)
= Seek professional advice (different rules)
Inside EU/EEA/OECD
= Go to Question 3
---
QUESTION 3: Is it a UCITS fund or similar to Irish regulated funds?
Quick check - Does it have:
- Regulatory approval in its home country? YES/NO
- A prospectus or key information document? YES/NO
- Diversification rules? YES/NO
- Public availability (not private/restricted)? YES/NO
Mostly YES answers
= Deemed disposal at 38% (with 8-year rule)
Mostly NO answers
= CGT at 33% (no 8-year rule)
---
CRITICAL WARNING:
Can you personally influence or direct what the fund invests in?
YES = PPIU at 60% (extremely punitive - avoid if possible!)
NO = Standard rates apply as above
---
Summary Table:
Investment Type Tax Rate 8-Year Rule? Loss Relief?
Direct shares/property 33% CGT No Yes
UCITS/equivalent fund 38% Yes No
Non-equivalent fund 33% CGT No Yes
PPIU (personal influence) 60% Yes No
---
Your answer: Based on the questions above, your investment is most likely:
[ ] CGT at 33% - tax only when you sell
[ ] Deemed disposal at 38% - tax every 8 years + when you sell
[ ] PPIU at 60% - avoid this arrangement if possible
---
Important:
- You must report all offshore investments on Form 11
- If unsure or investing a significant amount, seek professional tax advice
- Getting this wrong can be very costly
--------------
Detailed version
Thank you for your enquiry about [X investment].
To determine whether this investment is subject to Capital Gains Tax (CGT) or the deemed disposal rules, I'll need to gather some information about the investment.
Please work through the questions below, and the decision tree will guide you to the answer.
---
Please answer the following questions about [X investment]:
Question 1: What type of investment is it?
- [ ] A fund (unit trust, UCITS, investment company, mutual fund, SICAV, etc.)
- [ ] Direct shares in a company
- [ ] Property
- [ ] Bonds/fixed income securities
- [ ] Other (please specify)
Question 2: Where is it located/domiciled?
- [ ] Ireland
- [ ] EU country (please specify: _________)
- [ ] EEA country (Norway, Iceland, Liechtenstein)
- [ ] OECD country with Irish tax treaty (e.g., UK, US, Switzerland)
- [ ] Other location (please specify: _________)
If it's a FUND, please answer these additional questions:
Question 3: Is it regulated and by whom?
- [ ] Yes - regulated by [insert regulator name, e.g., Central Bank, FCA, AMF]
- [ ] No - not regulated
- [ ] Don't know
Question 4: What type of fund structure is it?
- [ ] UCITS (Undertaking for Collective Investment in Transferable Securities)
- [ ] Unit trust
- [ ] Investment company/SICAV/ICAV
- [ ] Alternative Investment Fund (AIF)
- [ ] Hedge fund
- [ ] Private equity fund
- [ ] Investment limited partnership
- [ ] Don't know
Question 5: Does it have these characteristics?
- [ ] Publicly available to investors (not private/restricted)
- [ ] Has a prospectus or key information document
- [ ] Has diversification rules (can't put all money in one asset)
- [ ] Has a depositary/custodian holding the assets
- [ ] Regular regulatory reporting requirements
Question 6: CRITICAL - Can you personally influence what the fund invests in?
- [ ] No - the fund manager makes all investment decisions
- [ ] Yes - I can direct or influence investment choices
- [ ] Partially - I have some input on investment strategy
---
DECISION TREE - Follow the steps below:
STEP 1: Is it a FUND or a DIRECT INVESTMENT?
→ If it's DIRECT SHARES, PROPERTY, or BONDS (not held through a fund):
YOUR ANSWER: Capital Gains Tax (CGT) at 33%
- Tax only when you sell
- No 8-year deemed disposal
- Can offset losses against other gains
- €1,270 annual CGT exemption applies
- STOP HERE - this is your answer
→ If it's a FUND (unit trust, UCITS, mutual fund, investment company, SICAV, etc.):
Go to STEP 2
---
STEP 2: Where is the fund located?
→ If OUTSIDE the EU/EEA/OECD (e.g., Cayman Islands, Jersey, Guernsey):
Different rules apply - seek professional advice immediately
STOP HERE
→ If INSIDE the EU/EEA/OECD:
Go to STEP 3
---
STEP 3: Is it similar to an Irish regulated fund?
Ask yourself these questions:
A. Is it a UCITS fund?
B. Is it structured as a unit trust?
C. Is it an investment company with similar rules to Irish Part XIII companies?
D. Does it have a depositary/custodian?
E. Does it issue a prospectus or key information document?
F. Does it have diversification rules?
G. Is it publicly available (not a private arrangement)?
H. Is it regulated by the country's financial regulator?
→ If you answered YES to MOST (5 or more) of the above:
This is likely an "EQUIVALENT FUND"
Go to STEP 4
→ If you answered NO to MOST of the above:
This is likely a "NON-EQUIVALENT FUND"
YOUR ANSWER: Capital Gains Tax (CGT) at 33%
- Normal income tax on dividends/distributions
- CGT at 33% when you sell
- No 8-year deemed disposal
- Can offset losses against other gains
- Must still report on Form 11 under "Other Offshore Products"
- STOP HERE - this is your answer
---
STEP 4: Can you personally influence the fund's investments?
This is CRITICAL - be honest:
→ NO - The fund manager makes ALL investment decisions without your input:
YOUR ANSWER: Deemed Disposal Rules at 38%
- Tax at 38% on payments and gains
- 8-year deemed disposal applies (automatic tax every 8 years)
- Must file Form 11 annually under "Offshore Funds (Part 27 Ch 4)"
- NO loss relief available
- STOP HERE - this is your answer
→ YES - You CAN direct or influence what the fund invests in:
YOUR ANSWER: PPIU (Personal Portfolio Investment Undertaking) at 60%
- Tax at 60% on payments and gains (80% if not reported correctly!)
- 8-year deemed disposal applies
- Must file Form 11 annually
- NO loss relief available
- **STRONGLY CONSIDER AVOIDING THIS INVESTMENT**
- Seek professional advice before proceeding
- STOP HERE - this is your answer
---
Based on the decision tree above, your investment [X] is most likely subject to:
CGT at 33% if:
- It's a direct investment (shares, property), OR
- It's a non-equivalent fund
Deemed Disposal at 38% if:
- It's an equivalent fund (UCITS, similar unit trust/investment company)
- You cannot influence investments
[ ] Deemed Disposal at 60% (PPIU)if:
- It's any fund where you can personally direct investments
---
| Your Investment Type | Tax Treatment | Rate | 8-Year Rule? |
|---------------------|---------------|------|--------------|
| Direct shares (any company) | CGT | 33% | No |
| Direct property | CGT | 33% | No |
| UCITS fund (EU/EEA) | Deemed disposal | 38% | Yes |
| Irish unit trust | Deemed disposal | 38% | Yes |
| Non-equivalent offshore fund | CGT | 33% | No |
| Any fund you can influence | Deemed disposal | 60% | Yes (PPIU) |
---
If you're still unsure:
1. Check the fund's prospectus or key information document
2. Look for terms like "UCITS", "AIF", "regulated fund"
3. Check if it's listed on the fund provider's website as equivalent to Irish funds
4. Contact the fund provider directly and ask if it's an "equivalent fund" for Irish tax purposes