Wednesday, 4 Mar 2026

Written Answers Nos. 82-101

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Tax Yield

Questions (82, 83, 84, 85, 91, 99, 101, 102)

Ken O'Flynn

Question:

82. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance the total revenue collected by the State specifically from deemed disposal taxation on EU-domiciled Exchange Traded Funds and other collective investment undertakings subject to the eight-year deemed disposal rule in each of the years 2015 to 2025 inclusive; the estimated revenue projected for each remaining year of the current tax regime; and if he will make a statement on the matter. [17594/26]

Ken O'Flynn

Question:

83. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance the total number of individual taxpayers who filed a deemed disposal liability on Exchange Traded Funds or other collective investment undertakings in each of the years 2015 to 2025 inclusive; the average deemed disposal tax liability per individual in each year; the total number of individuals who were required to sell holdings in order to meet a deemed disposal tax liability in each year; and if he will make a statement on the matter. [17595/26]

Ken O'Flynn

Question:

84. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance the total administrative cost to Revenue of collecting deemed disposal taxation on Exchange Traded Funds and collective investment undertakings, including staff costs, systems costs, compliance overhead, and enforcement activity, in the most recent year for which data are available; how this administrative cost compares to the total revenue collected from deemed disposal on these instruments in the same year; and if he will make a statement on the matter. [17596/26]

Ken O'Flynn

Question:

85. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether his Department or Revenue has conducted any assessment of the ratio of administrative cost to revenue collected specifically in respect of the deemed disposal regime as it applies to Exchange Traded Funds; if not, the reason therefor; whether he considers the current regime to represent value for money from a tax collection efficiency standpoint; and if he will make a statement on the matter. [17597/26]

Ken O'Flynn

Question:

91. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance the number of individual taxpayers who crystallised a deemed disposal loss on Exchange Traded Funds or collective investment undertakings in each of the past five years; the total value of those losses; whether those taxpayers were entitled to any relief on those losses against other income or gains; and if he will make a statement on the matter. [17603/26]

Ken O'Flynn

Question:

99. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance the number of individual investors who will face their first deemed disposal event on Exchange Traded Fund holdings in each of the years 2026, 2027, and 2028; the estimated aggregate tax liability that will crystallise in each of those years; whether Revenue has assessed the capacity of individual investors to meet these liabilities without being required to sell holdings; and if he will make a statement on the matter. [17655/26]

Ken O'Flynn

Question:

101. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance the estimated annual cost to the Exchequer of abolishing the deemed disposal regime on Exchange Traded Funds entirely and replacing it with a standard capital gains tax charge on actual disposal at the standard 33% rate; how this cost compares to the current annual revenue generated by the deemed disposal regime on these instruments; and if he will make a statement on the matter. [17657/26]

Ken O'Flynn

Question:

102. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether he has considered, as an alternative to full abolition of the deemed disposal regime, extending the deemed disposal interval from eight years to fifteen or twenty years; the estimated revenue impact of such a change; whether such an extension would materially reduce the distortive effect of the regime on long-term investment behaviour; and if he will make a statement on the matter. [17658/26]

Written answers

Tánaiste and Minister for Finance

I propose to take Questions Nos. 82, 83, 84, 85, 91, 99, 101 and 102 together.

The deputy has asked a number of questions about the cost of deemed disposal. The tax revenue arising from the taxation of investment funds and life assurance policies, including deemed disposal rules, was examined in the context of Budget 2026. The information available to Revenue does not allow them to isolate the tax returned due to deemed disposal rules from other chargeable events which give rise to a tax liability. Chargeable events include:

• the making of relevant payments,

• the redemption of the investment,

• the transfer by an investor of their investment, and

• the ending of an eight-year period following the acquisition of the investment and then every eight years thereafter. This is commonly referred to as a deemed disposal.

Therefore, it is not possible to identify directly the tax revenue arising from the application of deemed disposal rules. This is because investment funds are not obliged to report the category of chargeable event that the exit tax relates to at the time of making payment to Revenue. Similarly, as respects investments in certain Irish domiciled funds and offshore funds in respect of which investors are required self-assess tax due, taxpayers are not required to separately report data for each category of chargeable event when filing their tax return.

Therefore, while it is possible to identify the amounts of tax paid by funds in respect of unit holders, being Investment Undertaking Tax (IUT), and income tax accounted for by individuals in respect of their investments in Irish domiciled funds and offshore funds, it is not possible to provide a breakdown of the tax which relates to the eight-year deemed disposal nor is it possible to provide data on the number of individuals who are impacted by the deemed disposal rule.

On the basis of the information available to Revenue, and based on tax paid over the last eight years, if it was assumed that all tax paid by funds in respect of unit holders, tax paid by life companies in respect of policy holders, and income tax accounted for by individuals in respect of their investments in Irish domiciled funds, offshore funds and life products were as a result of deemed disposal, removing deemed disposal could give rise to a potential cost of €284 million. For Budget 2026, an estimate was prepared for the Exchequer impact in a year where deemed disposal did not apply, assuming that deemed disposal was closer to 50% of the total tax paid. This assumption results in an estimated full year cost to the Exchequer of €142 million for the removal of deemed disposal for investment funds and life assurance products.

However, it is important to note that the actual cost could vary where the proportion of tax which arises from deemed disposal rules is higher or lower, as well as where the gains in a particular year are larger or smaller than the eight-year average used for this estimate.

The table below provides the estimated amount of overall tax arising from 2016 to 2024 in respect of investments in investment funds, including IUT and income tax on Irish domiciled funds and certain offshore investment funds, which includes amounts in respect of ETFs. Data for 2025 is not yet available. Revenue cannot provide the 2015 figures in the time available to provide a response.

Year	Tax on Offshore Funds* €m	Tax on Foreign Life Policies* €m	IUT €m	LAET** €m	Total €m
2024	*	*	73.5	169	242.5
2023	29.4	0.6	90.8	231	351.8
2022	33.8	1.0	82.1	233	349.9
2021	62.0	1.0	57.3	129	249.3
2020	33.0	0.8	39.1	124	196.9
2019	28.6	0.4	28.0	128	185
2018	21.0	0.6	39.7	165	226.3
2017	25.6	2.0	39.6	184	251.2
2016	22.4	0.3	37	228	287.7

*Total gross tax liability on income / gains from offshore funds and foreign life policies per Form 11 return. Form 11 data for 2024 is not yet available.

** IUT and LAET represent the amount of tax paid to Revenue. It is not possible to identify whether the figures for IUT and LAET represent amounts taxed at 25% in respect of corporate investors or 41% in respect of individual investors.

As regards the administration costs to Revenue of collecting and administering the tax from deemed disposals, Revenue operates an integrated tax and customs administration and therefore in most instances the costs of administering a single tax cannot be quantified.

It should be noted that Budget 2026 included a commitment to the publication of an approach to the taxation of retail investment, which will set out an approach to simplify and adapt the tax framework to further support retail investment. The work underway includes consideration of the Funds Sector 2030 Report deemed disposal, as well the European Commission’s recommendation on Savings and Investment Accounts.

Question No. 83 answered with Question No. 82.

Question No. 84 answered with Question No. 82.

Question No. 85 answered with Question No. 82.

Tax Code

Questions (86, 87, 88, 89, 90, 92)

Ken O'Flynn

Question:

86. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether he is aware of any other EU member state or comparable OECD jurisdiction that operates a deemed disposal or equivalent forced realisation taxation mechanism on unrealised gains in Exchange Traded Funds or equivalent collective investment products held by individual retail investors; if so, to identify those jurisdictions; if not, whether he considers it appropriate that Ireland operates a taxation mechanism with no equivalent in comparable economies; and if he will make a statement on the matter. [17598/26]

Ken O'Flynn

Question:

87. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether his Department has conducted any comparative analysis of the taxation treatment of Exchange Traded Fund investments by individual retail investors across EU member states; whether such analysis informed the decision to retain the deemed disposal regime in recent budgets; whether this analysis has been published; and if he will make a statement on the matter. [17599/26]

Ken O'Flynn

Question:

88. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether he accepts that Ireland's deemed disposal regime, which imposes a 41% tax on unrealised gains in EU-domiciled Exchange Traded Funds every eight years with no provision for loss relief against other income, represents a materially more punitive taxation environment for retail investors in collective funds than that which applies in any comparable EU member state; and if he will make a statement on the matter. [17600/26]

Ken O'Flynn

Question:

89. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance the reason the exit tax rate applicable to gains on Exchange Traded Funds and other collective investment undertakings subject to deemed disposal is set at 41%, exceeding the 33% capital gains tax rate applicable to direct shareholdings and other assets; whether he considers it appropriate that an individual who invests in a diversified EU-regulated fund product is taxed at a higher rate on gains than an individual who invests directly in equities; and if he will make a statement on the matter. [17601/26]

Ken O'Flynn

Question:

90. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance the reason losses arising on Exchange Traded Funds and other collective investment undertakings subject to the deemed disposal regime cannot be offset against gains on other assets or against other income for the purposes of income tax; whether he considers this prohibition on loss relief to be equitable relative to the treatment of losses on direct equity investments under the capital gains tax regime; whether he has received any advice from the Tax Strategy Group or Revenue on the rationale for this asymmetry; and if he will make a statement on the matter. [17602/26]

Ken O'Flynn

Question:

92. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether he has considered introducing a provision allowing losses realised under the deemed disposal regime on Exchange Traded Funds to be offset against capital gains tax liabilities on other assets; the estimated cost to the Exchequer of such a provision; and if he will make a statement on the matter. [17648/26]

Written answers

Tánaiste and Minister for Finance

I propose to take Questions Nos. 86, 87, 88, 89, 90 and 92 together.

Section 58 of Finance Act 2000 introduced the gross roll-up taxation regime for investments in domestic funds. While Finance Act 1990 had introduced anti-avoidance rules that are known as the “offshore funds” regime, Finance Act 2001 (in section 72) amended the offshore funds regime to provide for gross roll-up in certain offshore funds that were similar to the Irish funds within the gross roll-up regime.

There is no separate taxation regime for Exchange Traded Funds (“ETFs”). As collective investment funds, they generally fall within the gross-roll up regime applicable to regulated domestic and offshore funds.

The general thrust of the gross roll-up regime is that there is no annual tax on income or gains arising within the investment. However, IUT or exit tax as it is commonly known must be deducted on the occurrence of a “chargeable event”, which generally includes instances where value passes from the fund to the investor or on a deemed disposal every 8 years.

Finance Act 2006 introduced the above-mentioned eight-year deemed disposal rule for all investments that benefit from the gross roll-up regime. This amendment was designed specifically to prevent the avoidance of tax by way of indefinite deferral of tax under the gross roll-up regime. This ensures that income isn’t being rolled up in funds without being taxed. On the ultimate disposal of the investment, any tax paid which arose as a result of a deemed disposal is allowed as a credit against any final tax liability on disposal.

Exit tax is withheld by the investment fund where there is a gain on the happening of a chargeable event. However, for certain investment funds where the units are held on a recognised clearing system, such as the case with ETFs, the fund is not required to deduct exit tax and the investor must self-assess the tax due. Whether the investment fund accounts for exit tax or that tax is collected through self-assessment, the amount of the gain is subject to tax at a rate of 38% for individuals, or 25% if the investor is a company (a higher rate can apply where the investment fund is a personal portfolio investment undertaking).

The rates of exit tax applicable to ETFs (and other investment funds) may be distinguished from the rates applicable to income and gains from other investment products, such as direct investment in equities or property, due to the availability of the gross roll-up regime, where the income and gains can roll-up tax free within the investment fund and given the fact that tax is applied to a combination of both the income and gains from the underlying investments in the investment fund.

Loss relief is not available in respect of losses arising on disposals of units in ETFs which are subject to the gross-roll up regime. IUT is not a tax on investors, but on the fund itself and the fund is required to compute the tax, deduct the tax and return it to Revenue. Irish tax legislation specifically provides that IUT is a liability of the fund. Therefore, as the investor is not taxed on the gain arising on a chargeable event, the investor is accordingly not entitled to relief in respect of losses arising.

ETFs are not subject to a harmonised system of taxation at EU level. While ETFs are commonly established under the UCITs regulatory framework, taxation of investors and funds remains a matter for individual Member States. As such, the tax regimes applicable to the taxation of ETFs varies across Member States, and across OECD members.

The EU Savings and Investments Union aims to create better financial opportunities across the EU, providing people with more opportunities to invest and provide for their current and future prosperity. The project also aims to deepen the pools of capital available for investment in businesses across Europe, grow the European economy and benefit our strategic objectives. In March last year, the European Commission launched the SIU Strategy, which included a number of measures to advance the Capital Markets Union project. In September 2025, the European Commission adopted a Recommendation on increasing the availability of Savings and Investment Accounts in Member States which would facilitate participation in capital markets, including investments in ETFs. This Recommendation is being considered as part of the work underway to set out an approach to the taxation of retail investment which will be published in the coming months.

Question No. 87 answered with Question No. 86.

Question No. 88 answered with Question No. 86.

Question No. 89 answered with Question No. 86.

Question No. 90 answered with Question No. 86.

Question No. 91 answered with Question No. 82.

Question No. 92 answered with Question No. 86.

Tax Data

Questions (93, 94, 95, 96, 97, 98, 100, 103)

Ken O'Flynn

Question:

93. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether Revenue or his Department has conducted any assessment of the volume of retail investment that has been diverted away from EU-domiciled Exchange Traded Funds and into non-EU domiciled funds, direct equity shareholdings, or other asset classes specifically to avoid the deemed disposal regime; if not, the reason therefor; whether he intends to commission such an assessment; and if he will make a statement on the matter. [17649/26]

Ken O'Flynn

Question:

94. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether his Department has assessed the impact of the deemed disposal regime on the concentration of Irish household wealth in residential property relative to diversified investment assets; whether the regime has been considered in the context of any government policy document addressing wealth concentration in property, housing affordability, or long-term savings behaviour; and if he will make a statement on the matter. [17650/26]

Ken O'Flynn

Question:

95. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether he accepts that the deemed disposal regime, by making long-term diversified investment in EU-regulated fund products uniquely punitive relative to property investment, actively disincentivises the exact savings and investment behaviour that government policy in areas including housing, pension adequacy, and financial resilience explicitly seeks to encourage; and if he will make a statement on the matter. [17651/26]

Ken O'Flynn

Question:

96. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether any assessment has been made of the impact of the deemed disposal regime on compliance behaviour; specifically whether the regime creates an incentive for individual investors to hold investments through corporate structures, self-directed pension vehicles, or non-Irish domiciled accounts in order to avoid the eight-year crystallisation event; the estimated revenue impact of such behavioural responses; and if he will make a statement on the matter. [17652/26]

Ken O'Flynn

Question:

97. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether the deemed disposal regime has been assessed for its impact on the financial planning decisions of workers in defined contribution pension schemes who hold Exchange Traded Funds outside their pension wrapper as a supplementary long-term savings vehicle; whether the regime creates a disproportionate burden on such individuals relative to those whose savings are entirely within pension vehicles not subject to deemed disposal; and if he will make a statement on the matter. [17653/26]

Ken O'Flynn

Question:

98. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance the basis upon which the eight-year period was chosen as the deemed disposal interval for Exchange Traded Funds and collective investment undertakings; whether any economic modelling was conducted to assess the optimal interval from the perspective of revenue collection, investor behaviour, and administrative efficiency; whether a longer or shorter interval was considered; and if he will make a statement on the matter. [17654/26]

Ken O'Flynn

Question:

100. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether the Tax Strategy Group has produced any paper assessing options for the reform or abolition of the deemed disposal regime as it applies to Exchange Traded Funds; if so, whether that paper has been published; if not, whether he will commission such a paper in advance of Budget 2027; and if he will make a statement on the matter. [17656/26]

Ken O'Flynn

Question:

103. Deputy Ken O'Flynn asked the Tánaiste and Minister for Finance whether the retention of the deemed disposal regime at its current 41% rate and eight-year interval is consistent with the Government's stated objective of encouraging long-term household saving and investment diversification; whether any policy coherence assessment has been conducted between the deemed disposal regime and broader Government policy goals relating to household financial resilience, pension adequacy, and the reduction of wealth concentration in residential property; and if he will make a statement on the matter. [17659/26]

Written answers

Tánaiste and Minister for Finance

I propose to take Questions Nos. 93, 94, 95, 96, 97, 98, 100 and 103 together.

The Deputy asks about the interaction between deemed disposal and investment decisions, including in relation to the types of assets invested in, and the Government’s commitment to encouraging retail investment.

Due to the mechanics of the eight-year deemed disposal, (across both life and fund investment provisions), and the data which is returned to Revenue, it is not possible to garner the exact tax yield of the eight year deemed disposal provisions. In addition, as with all anti-avoidance rules, its existence has a deterrent effect which it is not possible to put a value on.

Individual assessments on the relationship between deemed disposal and other forms of investment have not been undertaken. Data on the volume of retail investment that may have been diverted away from EU-domiciled ETFs and into non-EU domiciled funds, direct equity shareholdings, or other asset classes specifically to avoid the deemed disposal regime is not available.

The importance of ensuring that retail investment is encouraged is recognised by this government, including through commitments in the Programme for Government.

Ireland is currently ranked as one of the top EU Member States in terms of savings held in deposit accounts. I am aware that part of the reason why retail participation in markets is limited is the lack of awareness of these products, and in some cases the complexity of some of the products can also dissuade retail consumers.

It is a priority of the government to promote financial literacy and widen retail investment across the country. This will assist in ensuring savings could be invested for the benefit of individuals as well as the European economy. Financial literacy is an essential life skill and important component of financial consumer protection. In February 2025 this government launched Ireland’s first National Financial Literacy Strategy. In this regard, the European Commission’s financial literacy strategy is welcome. The strategy aims to empower citizens, raise awareness and increase their participation in capital markets, creating a more “investment savvy” culture.

In line with the commitment in Budget 2026, work is underway on an approach to the taxation of retail investment. This work includes consideration of the current taxation regime for ETFs and other investment funds, as well as the European Commission’s Recommendation on the availability of Saving and Investment Accounts, drawing upon best practice in other countries who operate successful savings accounts. This is expected to be published in the coming months.

Question No. 94 answered with Question No. 93.

Question No. 95 answered with Question No. 93.

Question No. 96 answered with Question No. 93.

Question No. 97 answered with Question No. 93.

Question No. 98 answered with Question No. 93.

Question No. 99 answered with Question No. 82.

Question No. 100 answered with Question No. 93.

Question No. 101 answered with Question No. 82.

• Written Answers Nos. 61-81
• Written Answers Nos. 102-121