Dáil Éireann Debate, Tuesday - 7 July 2026
275. Deputy Emer Currie asked the Tánaiste and Minister for Finance if his Department, or the Revenue Commissioners, have examined the feasibility of assessing the returns of form IU(3E) as a means of better calculating the indicative IUT revenue raised via the deemed disposal rule; and the subsequent cost of abolishing the deemed disposal rule in respect of IUT. [51840/26]
View answerUnder the gross-roll up regime for investment undertakings, investment undertaking tax (‘IUT’) must be deducted on the occurrence of a ‘chargeable event’, which includes
• 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.
While Irish domiciled funds will generally deduct IUT on the happening of a chargeable event and return it to Revenue, there are circumstances where an Irish investor may be required to self-assess the tax due on their investment in a fund through their annual tax return.
In the case of a deemed disposal, an investment undertaking can in certain circumstances make an election to not apply IUT (this is commonly referred to as a ‘de minimis election’). Section 739E(2A) of the Taxes Consolidation Act 1997 provides that such an election can be made where the value of the chargeable units in the investment undertaking (i.e. those units held by unit holders that are not exempt from IUT) is less than 10% of the value of the total units in the investment undertaking. Where a de minimis election is made, the unit holder is required to account for tax due on a deemed disposal through the self-assessment system.
Where the de minimis election applies, the investment undertaking is required to file a statement (a Form IU(3e)) with Revenue on an annual basis. While the form requires certain information in relation to unit holders, it does not include all the information required to quantify the amount of tax due by unit holders on a deemed disposal.
In addition, it is important to note that not all investment undertakings file a Form IU(3e). It is only required to be filed by investment undertakings that have made a de minimis election.
