Emer Currie
Question:76. Deputy Emer Currie asked the Tánaiste and Minister for Finance his view on abolishing the eight-year deemed disposal rule in the capital gains tax system; and if he will make a statement on the matter. [4789/26]
View answerWednesday, 21 January 2026
Questions (76)
Written answers
The question relates to deemed disposal, which applies to the taxation of investment funds and life assurance products. Capital gains tax is a separate system of taxation and deemed disposal is not part of the capital gains tax regime.
Deemed disposal is an anti-avoidance measure that applies to investments in Irish domiciled investment funds and life assurance products, as well as equivalent offshore funds and certain foreign life assurance products. Under deemed disposal, tax is levied eight years after an investment is made, and every subsequent eight years, regardless of whether or not a disposal has in fact occurred. The tax is levied on any gain in the value of the investment from the date of acquisition to the date of the deemed disposal. On the ultimate disposal of the investment, any tax paid is allowed as a credit against the final tax liability. The purpose of deemed disposal is to prevent the indefinite roll-up of income and gains and the associated loss of tax to the Exchequer.
I am committed to taking the necessary action to support retail investment in Ireland. The reduction from 41% to 38% in the taxation rate that applies to Irish and equivalent offshore funds and Irish and certain foreign life assurance products, that was announced in Budget 2026, is an important first step in this regard.
I am aware of the concerns regarding the taxation of investment and the operation of deemed disposal in particular. It is important to ensure that any changes in this area achieve an appropriate balance between supporting retail investment and maintaining appropriate anti-avoidance protections. Work is continuing on the development of the road map for the taxation of retail investment, as announced in Budget 2026.The roadmap is to be published early this year and will set out an approach to simplify and adapt the tax framework to further support retail investment while retaining necessary and important anti-avoidance protections in a proportionate manner. This roadmap will facilitate due consideration of the Funds Sector 2030 Report andtake into accountthe European Commission’s recommendation on Savings and Investment Accounts. I hope further progress can be made to address some of the existing obstacles to greater retail investment.