When an Irish ETF is sold at a gain, how is the gain taxed?

• A. Exit tax at 41% is deducted by broker.
• B. She must return the gain in her tax returns and pay income tax at 41% on the gain.
• C. Capital gains tax at 33% on the gain is collected by broker.
• D. She must return the gain in tax returns and pay capital gains tax at 33% on the gain.

Answer: (B)

Gains from selling an Irish-domiciled ETF are treated as capital gains in Ireland. You must declare the gain on your annual tax return and pay capital gains tax on the gain at the 33% rate. The broker does not typically withhold CGT at the point of sale, and there isn’t a 41% exit tax applied to a normal ETF sale. So the correct approach is to report the gain and pay CGT at 33% on the gain.