'I get asked this almost by every client I have': ETFs with Kevin Elliott
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What is the personal investment account scheme and why are clients asking about it?
You're listening to the Irish Times.
This week we are returning to the issue of exchange traded funds. Should I invest now or hold off for the new personal investment account? Is it better to invest a lump sum or spread it over time? How do I track and report deem disposal? To revisit ETFs and chat about the new proposed government investment scheme, we're joined by Kevin Elliott, former New York and London investment banker and founder of Kevin Elliott. Elliot Wealth. I'm Aideen Finnegan and this is Better With Money from the Irish Times. Kevin, you're very welcome back to the podcast.
Thank you very much.
You joined us in July to talk about investing in exchange traded funds because as we've heard so many times on the podcast before, for the general population, they are the way to go. Now, if you're new here or if you're coming to ETS for the first time, we have some very detailed episodes for beginners, which I will link to in the show notes. Kevin, your community online had some excellent follow-up questions to the episode you featured on, which we will we'll get back to shortly. But I just wanted to firstly ask you with one eye on budget day now. I wanted to ask about your reaction to the confirmation we got earlier this month from the Minister of Finance about the proposed new personal investment account.
We learned that one, there will be a maximum amount you can contribute each year, presumably this is to stop kind of higher rollers taking advantage of something that serves Middle Ireland. Two, you'll be able to make gains or profits on your investments tax-free up to a certain threshold beyond which a simple flat rate tax will apply. And three, the financial institutions that will offer this account will handle the tax admin for you. So they'll tell revenue how much you owe. What we don't know is what the max contribution will be, what the threshold will be before you start paying tax, what that flat rate of tax will be, and how much companies are going to charge you to handle that tax return. I am very interested.
You that is a qualified financial advisor and you have many letters after your name, what's your take on this?
Yeah, so I'll just maybe pick up on something you said, which was how will this impact Middle Ireland, right? So we think about what the key goals of the scheme are. One is to get the 176 billion euro on deposit working.
Yeah, with the asterisk beside that.
Second thing is to enable ordinary people to generate wealth. And the third thing is to be the catalyst for the capital markets system in Ireland, right? So our ability to invest in companies in Ireland. And that has a bigger impact than maybe we see on the surface, which enables us to say, well, how can we how can we invest in regular Irish entrepreneurs of the over the future? So if we just look at maybe the three of them just very briefly.
Yes.
So the first thing, will it enable us to move a significant portion of that money on deposit into this account? Big question mark. I don't think so.
Really? Why?
Yeah. So if we think about it, the with this hundred and seventy-six billion in cash, right? And I can go into detail in a moment about how that's broken down, which I think is really important. Because the top 10% hold a significant portion, right? Yes. So the rate of growth over the last six months has been 9 billion. Okay. So that is a significant amount of money that's been parked, right? So this scheme. you just talked about the unknowns. If the max contribution level is say Twenty, thirty, forty thousand.
Mm-hmm.
It it won't even absorb the growth in cash and deposit.
Okay.
So that that's important. We can get this come back to this in a moment in in more detail in a moment. The second thing about will it help That Middle Ireland.
Yes, that nebulous term.
How does Kevin Elliott evaluate the impact of the new scheme on “Middle Ireland”?
So The answer is it will. Okay. The answer is it will. But will it help people in the bottom fifty percent? I don't think it'll help people at the bottom fifty percent.
No, I don't think so either because you have to have a surplus of money to be able to
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Chapters
8 chapters
1
What is the personal investment account scheme and why are clients asking about it?
0:01–3:29
2
How does Kevin Elliott evaluate the impact of the new scheme on “Middle Ireland”?
3:29–6:35
3
What are the key tax features (contribution caps, tax‑free thresholds, and deemed disposal) of the proposed account?
6:35–10:33
4
How will fees, provider charges, and tax‑administration costs affect ETF investors?
10:33–13:13
5
What practical steps can investors take to track and report deemed disposal on ETFs?
13:13–16:15
6
Should I invest a lump sum or use euro‑cost averaging when the market is high?
16:15–19:16
7
Can dual Irish‑US citizens invest in Irish ETFs and what restrictions apply?
19:16–21:50
8
What final advice does Kevin give listeners about getting started with ETFs now?
21:50–24:47
Speakers
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