Erin McGreehan
Question:154. Deputy Erin McGreehan asked the Tánaiste and Minister for Finance his plans for reform of deemed disposal tax; and if he will make a statement on the matter. [39408/26]
View answerTuesday, 26 May 2026
Questions (154)
Written answers
Deemed disposal is an anti-avoidance measure that applies to investments in Irish domiciled investment funds and life assurance products, and to equivalent offshore funds and certain foreign life assurance products. It was introduced to prevent the indefinite roll-up of income and gains, and the associated loss of tax to the Exchequer.
Under deemed disposal, tax is levied every eight years after an investment is made, regardless of whether a disposal has in fact occurred. On the ultimate disposal of the investment, any tax paid is allowed as a credit against the final tax liability.
I acknowledge the complexities associated with the deemed disposal rules, but any changes to these rules require guardrails to protect the Exchequer and ensure that appropriate taxation is paid. A balance between?supporting retail investment while retaining important and necessary anti-avoidance protections?is required and incredibly important.
I am committed to taking the necessary action to support retail investment in Ireland. Budget 2026 introduced a reduction in the taxation rate that applies to Irish and equivalent offshore funds and Irish and certain foreign life assurance products, from 41% to 38%.
Budget 2026 also included a commitment to publish a roadmap for the taxation of retail investment, setting out an approach to adapt the tax framework to further support retail investment while retaining necessary and important anti-avoidance protections. Work on the roadmap includes consideration of the European Commission’s Savings and Investment Account recommendation, and the Funds Review recommendations, including the issue of deemed disposal. The roadmap will be published in the coming months.
As I announced at the first annual Savings and Investment Forum, a key aspect of the roadmap is the development of a new Investment Account that aims to reduce the complexities related to retail investment taxation and allow Irish people to grow their savings more efficiently.
The investment account will take account of the the Commission's Recommendation which provides Member States with a European blueprint for such accounts, drawing on existing best practices to maximise their uptake and help achieve the objective of boosting retail participation in capital markets.
A key characteristic of this form of Investment Account, as per the Commission’s recommendation, is to be as simple as possible for the investor and for responsibility for tax compliance to lie with the account provider. It is my intention that the new investment account being introduced will be simple and accessible for retail investors.