The Roadmap for Deemed Disposal

TomEdison said:
But, to be clear, this isn't a special rule for passively-managed funds (either in the US or in Australia). The same system is in place for actively-managed funds. Honestly, I can't see any good argument for having different tax reporting/collection mechanisms for active and passive funds.
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Where I am coming from is that I can see a case for a DD with actively managed funds, there will be active trading and if the fund manager is doing his job properly and plenty of gains.

DD for passive trackers and especially distributing ones (they exist, I have a couple) is excessive.
 
TomEdison said:
The other factor we have to think hard about here is one I've pointed to earlier - if investing in the passively-managed index-tracker give the best return, given a neutral tax regime, why aren't people doing it already?
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Do you really think that the current ETF regime in Ireland is tax neutral??
 
TomEdison said:
Over pretty much any time period [that is relevant to a retail investor] odds are that some manager will beat the index. (But there is no reliable way of identifying in advance which manager will do so.)
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The catch is that all these analysis have the benefit of hindsight, and the managers beating the index are not the same in the different time period. So in order to reap the benefit you need to:
1) select the right fund
2) know when it's time to switch to the other successful manager

And keep doing that over and over.
 
Greenbook said:
I can see a case for a DD with actively managed funds, there will be active trading and if the fund manager is doing his job properly and plenty of gains.

DD for passive trackers and especially distributing ones (they exist, I have a couple) is excessive.
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The transactions that fund managers enter into - buying securities, selling securities, receiving income generated by securities, entering into other financial transactions - are the same, regardless of the investment objectives adopted or the investment strategy pursued. it would be an entirely needless complication to tax funds differently depending on what they are trying to acheive with the transactions they enter into, and I'd be suprised if many - or any - countries did that.
Wolframius said:
Do you really think that the current ETF regime in Ireland is tax neutral??
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No. But it's much closer to neutral (relative to direct investment in shares) than the highly advantageous deferral regime that some in this thread are calling for.
Wolframius said:
The catch is that all these analysis have the benefit of hindsight, and the managers beating the index are not the same in the different time period.
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Sure. Which is why opting for index-tracking is, in the view of many (including myself) a wise thing to do.

But it does not guarantee you the best return. It will likely be the case that, over the time that you hold your investment, one or more actively-managed funds will beat your index-tracker. It's important to recognise this at the outset and accept it — if only so that, when it happens, you don't think your choice of an index-tracker will have been proven wrong, or unwise.

The case for index-trackers is not that they will outperform all the actively-managed funds; just that they will outperform most of them.
 
messyleo said:
if that commitment is to be believed
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Indeed, but that is a big if.
Tough call whether to start buying ETFs (and whether to go distributing only in case it’s retained for accumulating) now and hoping it gets sorted. Hopefully a bit more information of the path to removal is laid out.
 
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