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      In August 2026, the government published a roadmap for the future taxation of retail investment in Ireland which had the goal of examining the current system of taxation and proposing changes in order to encourage Irish savers to make use of options which could provide higher returns and facilitate more productive use of their savings beyond keeping them in deposit accounts.

      Among the changes proposed was the new Investment Account, aimed at encouraging widespread retail investment in stocks, bonds, and funds with the potential to transform the Irish retail investment landscape for the better.

      The Minister for Finance’s speech confirmed that the new Investment Account is to be launched by providers on 1 July 2027. 

      Key features

      The key features of the Investment Account are as follows:

      • Eligibility

        The Investment Account will be available only to Irish tax-resident individuals, aged 18 and over, who hold a PPS number.

      • Number of accounts

        Only one Investment Account will be permitted per person.

      • Providers interact with Revenue

        The existing income tax regime and investment tax regime (including the deemed disposal rule for funds), will not apply to investments held within the Investment Account. Instead, qualifying providers will calculate, report and pay any tax due to Revenue on behalf of the investor, significantly simplifying the administrative burden for account holders.

      • Tax-free threshold

        Investment Accounts will have a tax-free threshold of €50,000, with a flat rate of tax of 1% applying annually to the value of the account above that threshold (with no tax payable if the threshold is not exceeded). The value of the account will be calculated daily with daily average value used for the purpose of calculating tax due. 

      • Cap on investment per annum

        There will be a cap of €12,000 on how much can be contributed to an Investment Account each year. No minimum investment is required.  

      • Eligible investments

        Investment Accounts can only invest in eligible investments such as listed shares, listed bonds, financial instruments traded on a regulated market and a range of investment funds suitable for retail investors – including exchange traded funds (ETFs). Given the focus on retail investors, complex products, such as derivatives and digital (crypto) assets, will not be eligible for inclusion in the account.

      • Eligible providers

        Eligible providers will be MiFID-authorised service providers, regulated fund managers, and insurance companies.

      • Holding period

        While not specified in the minister’s speech, we understand based on the Roadmap, that there will be no minimum holding or lock-in period, and portability of Investment Accounts between providers will be facilitated, where possible, on a tax-neutral basis.   

      Gareth Bryan

      Partner, Tax

      KPMG in Ireland

      How will it work?

      Some details of how the Investment Account will operate in practice are still to emerge; however, from what has been announced to date, and looking at how other jurisdictions operate similar schemes, we expect the Investment Account to work as follows:

      • Choose a provider and open the account

        Investment Accounts will be offered by banks, brokers and other authorised investment firms. A new customer will need complete the provider’s onboarding process (e.g., establishing their eligibility for an account, identity checks, and customer due diligence). Some providers may offer the Investment Account through an existing online-banking app or website. 

      • Decide how the investments will be managed

         The Investment Account is the tax wrapper, not an investment strategy. Depending on the provider, an Investment Account could allow for: (i) self-directed trading, where the customer chooses and trades investments; (ii) investment advice, where the provider recommends but the customer approves each transaction; (iii) managed funds or automated/model portfolios, where the customer selects a fund or risk profile and the holdings are managed/rebalanced within that product; or (iv) discretionary portfolio management, where the customer gives a manager authority to trade within an agreed mandate. 

      • Put money in

        Customers will fund the Investment Account by bank transfer, direct transfer or recurring payment, using the methods offered by the provider. Once cash is in the Investment Account, it can then be invested. While there is an annual limit on how much can be put into the account, there is no overall contribution ceiling over the lifetime of the account.

      • Transfer existing investments

        It may be possible for eligible securities to be transferred from another Investment Account without a sale, subject to both providers’ transfer processes and product availability. It is not yet clear if it will be possible to move eligible investments owned by the customer outside of their Investment Account into an Investment Account – if it is possible, it seems likely that legislation would be introduced to treat such a transfer as a disposal at market value and thereby crystallising a taxable gain or deductible loss outside the Investment Account. 

      • Make investments

        A self-directed customer would search the provider’s available product range and places buy/sell orders through the app, website, adviser or dealing desk. Typical holdings include listed Irish and foreign shares, investment funds, ETFs and other eligible listed instruments. The universe of eligible investments is large, but each provider will choose which markets and products it supports and apply normal product, knowledge/experience and appropriateness controls.

      • Regular saving and reinvestment

        The customer should be able to establish a standing monthly transfer. Providers likely will facilitate automatic investment into selected funds or an automated/model portfolio, but direct-share purchases may require the customer to place the order. Dividends, interest and sale proceeds remain as cash in the Investment Account until reinvested or withdrawn.

      • Monitor and change the portfolio

        The customer should be able to view their holdings, performance, transactions and documents online, as well as buy, sell or switch eligible investments without reporting each purchase or disposal to the Revenue Commissioners. Under an advisory arrangement, the customer remains the decision-maker; under a discretionary mandate the manager trades and rebalances within the agreed objectives, risk level and restrictions.

      • Take money out

        There is no statutory lock-in or withdrawal tax. The customer sells enough investments, waits for settlement where necessary, and instructs a cash transfer to a verified bank account using the provider’s withdrawal process. Unsold eligible securities may instead be transferred to another Investment Account where the providers support an in-specie transfer. 

      • Close or move the account

        The customer can normally close the Investment Account once holdings, unsettled trades, cash, fees and any lending positions have been dealt with. A provider-to-provider move may be completed in cash or, where supported, by transferring eligible securities. Selling inside the Investment Account to facilitate the move should not itself result in any Irish capital gains tax.

      • Tax collection

        At year end (or when the account is closed), the provider values the investments in the account and computes the 1% tax charge on the value in excess of the tax-free threshold of €50,000. The customer may transfer cash into the account to fund this liability or else sell investments to fund it.

      Investment Account taxation

      Many of the operational details as to exactly how tax will be computed and collected will not be fully known until the Finance Bill is published, nevertheless based on the Roadmap and the information released in today's Budget, it is possible to have an illustrative idea of what the new Investment Account might look like.

      Cathal opens a new Investment Account in July 2027. He invests a total of €6,000 in 2027 which he uses to buy shares in a number of different companies. In November, he receives a dividend on one of those shares of €200. At 31 December 2027, his investment is valued at €6,600.

      Cathal will not pay any income tax on the €200 dividend he received in 2027. In addition, as the value of his investment at the end of 2027 did not exceed the tax-free threshold of €50,000, he will not pay any tax on his Investment Account.

      By the end of 2030, Cathal has invested a total of €42,000 and by the end of that year his total investment is worth €55,000. As the value of his Investment Account now exceeds the tax-free threshold, he will pay tax on the excess: €55,000 – €50,000 = €5,000 x 1% = €50. This will be collected and paid by the Investment Account provider (and Cathal can either deposit the cash to fund this liability or they can sell some of his investments to raise the amount due).

      While the relative simplicity of the taxation of the Investment Account should help make it attractive, this simplicity comes with trade-offs. For example, tax will apply to the amount in excess of the tax-free threshold irrespective of the performance of the investment in any given year.

      So, tax will still need to be paid even where the value of investment decreases so long as the total value of the account exceeds the tax-free threshold. Moreover, there will be no relief for any losses incurred.

      There will be other areas where these investments will interact with the tax system. For example, the application of capital acquisitions tax in the case of a gift or inheritance, whether it is possible to transfer existing investments into an account (or take investments out), or how the regime will interreact with other tax reliefs (such as exemptions for transfers of assets between spouses).

      We expect more details on these matters (and many others) in the Finance Bill.

      Future innovations

      It was confirmed that consideration will be given in future years to providing for multiple accounts to be allowed per person. In addition, we understand that the department is giving consideration to the potential introduction of other innovations in future years such as the possibility of setting up an Investment Account for children (as noted above, at present only 18-year-olds may open an account).

      The ability to do this may offer an attractive way to help save for a child's future whether that be to fund education or the deposit on a house.

      KPMG insights – our view

      The success of the Investment Account will, no doubt, partly depend on whether the tax-free threshold and the maximum amount that can be invested each year is seen as sufficiently attractive.

      It is certainly the case that a key factor in making it a success should be the relative simplicity of the taxation regime to be applied to it. While there are many factors that have affected the historical tendency of Irish households not to invest in investment products, there is no doubt that the existing tax regime has been a factor.

      This is both in terms of the relatively high rates of income tax (on dividends and interest) and investment undertaking tax (i.e. exit tax) on income from funds, and also the sometimes-confounding tax regime that can apply to offshore funds.

      Under the new Investment Account regime, the elimination of these other tax regimes and the imposition of a straight-forward valuation tax collected by the provider (thereby requiring no self-assessment or filing of returns for individual investors) has the potential to elicit wider public interest.

      This new Investment Account has the potential to transform the Irish retail investment landscape in Ireland for the better. Combined with recently introduced pension auto-enrolment scheme, we could see a very significant shift in how many (and by how much) Irish households are invested the capital markets

      Get in touch

      The measures unveiled in Budget 2027 will have far-reaching implications for businesses across Ireland. If you have any enquiries, comments, or wish to explore further, we are here to assist.

      Contact Olive O'Donoghue of our Tax team today. 

      Gareth Bryan

      Partner, Tax

      KPMG in Ireland

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