How to Buy Shares Online in Ireland

With the interest rates on savings accounts in Ireland remaining so low at the moment – some people might be looking for alternative ways to invest some of their money in 2020.

Buying shares or stocks is one way of potentially earning a good return from an increase in share value and also from dividends.

When people see the big rises in share prices of companies like Tesla , Amazon, Google, Facebook and Apple it’s no wonder they might want to try and make some money from shares.

Investing in stocks and shares involves risk of loss, they can fall in value as well as rise. So it is not recommended to invest money that you cannot afford to lose. If you want to guarantee that you will not lose any of your money, then the stock market is probably not for you .

Stocks and Shares

A share is a small part of a company that you can buy for a set price. When you buy shares in companies like Amazon or Ryanair or Tesla , you become a shareholder in that company.
A person can also own shares of several kinds of financial instruments: such as investment trusts, mutual funds and exchange-traded funds.


Stock
is the generic term for shares , and the Stock Market is the various exchanges where shares are bought and sold by stockbrokers. The London Stock Exchange, New York Stock Exchange etc.

Share prices can move up or down in value, depending on the performance of the stock market, the current profitability of the company and the expected future profitability or potential of the company.


Cheapest Way to Buy Shares Online in Ireland

The cheapest way to buy stocks and shares is to have an online “execution-only” account with a stockbroker . That means you can buy or sell shares or ETFs that you chose yourself without getting any advice from a broker.

Listed below is a comparison of the share trading fees at some online stock brokers that can be used in Ireland. We have compared fees at DEGIRO, Interactive Investors, Davy and Goodbody.

(Fees shown are for buying or selling shares / ETFs and were checked in January 2020 ). (More about ETFs here)

In our comparison of online share dealing and portfolio management costs – DEGIRO came out as the cheapest.
In one example they were 78 times cheaper than the most expensive online stockbroker option.
We have not included stamp duty in the comparisons because it will be the same for all providers.


Buying Shares in Ireland - a Price Comparison

Broker NameBuy €1000 of Irish SharesBuy €10,000 of Irish SharesBuy €10000 shares on NYSE Buy €1000 of shares
on
London Stock Exchange
Buy €10,000 Irish shares
in 5 different companies
Buy €10,000 Irish shares
in 5 different companies
and keep for 5 years.
Buy €10000 of Amazon shares
and keep for 5 years.
De Giro€2.58€7.80€0.52€4.58€39 €39€13.02
Interactive Investors€20€20€20€20€100 €100€20
Davy €14.99
€50€75€14.99€250 €1200€1025
Goodbody€25€100€125€25€500 €1000€625

Review of Stockbroker Fees

DEGIRO

DEGIRO is based in the Netherlands where it launched its online stock brokerage services in 2013.
DEGIRO now operates in 18 European countries – including Ireland. DEGIRO was voted the Best Low-cost Stockbroker in 2017and 2018 by the Investors Chronicle / Financial Times.
Degiro is regulated in the Netherlands and uses EU passporting rules to allow it to operate across the single market.

Fees at DEGIRO

  • Buy or Sell Irish shares : €2 + 0.058% per trade
  • Buy/Sell UK / European shares: €4 +0.058% per trade capped at a maximum of €60
  • Buy/Sell US shares : €0.50 per trade + (USD 0.004 per share)
  • Annual fees – DEGIRO has an annual fee you for connecting you to exchanges. This fee is currently just €2.50 per exchange per year but there is no fee for the Irish exchange for Irish residents.
  • Foreign exchange fees – Manual €10 plus 0.02% OR auto 0.1%

So that means if you bought €10,000 worth of Irish shares in 5 different companies (total of €50,000) and held them with DEGIRO for 5 years and bought no more – DEGIRO would charge you €0.00 in maintenance fees and €39 in commission. a total of €39 . See the table above to see more examples of DEGIRO charges compared to Interactive Investors and other online stockbrokers.
You can sign up to DEGIRO here.


Interactive Investors

Interactive Investors is based in London and regulated by the UK Financial Conduct Authority. In the UK Interactive Investors is the second largest retail stockbroker, based on the volume of customer transactions.

Fees at Interactive Investors

  • €20 per trade up to €100k
  • €52 per trade 100k to 500k then €80 per trade over €500k
    • Transaction fees reduced by €5 if you trade 10 or more times in the preceding 3 months.
  • Foreign exchange fees from 0.25% to 1.5%
  • Maintenance Fees : €30 fee every 6 months if you don’t trade and have less than €5k in portfolio

So that means if you bought €10,000 worth of Irish shares in 5 different companies (total €50,000) and held them with Interactive Investors for 5 years and bought no more – they would charge you no maintenance fees and €100 in commission – a total of €100 . Compared to DeGiro – Interactive Investors works out €61 more expensive.
You can sign up to Interactive Investors here.


Davy

A stockbroker established in 1926, the Davy Group is based in Dublin and is regulated by the Central Bank of Ireland. They manage €14bn+ of client assets, with offices in Dublin, Cork, Galway, Belfast, London and Luxembourg. ​

Fees at Davy :

  • Trading fees of 0.5% – Minimum €14.99.
  • €25 Foreign Transaction Settlement Charge per trade for each trade of shares listed outside Ireland and UK .
  • Foreign exchange fees max 1%.
  • Minimum Fee per trade for shares listed outside Ireland and UK 0.06%.
  • Execution Service Fee of €50 per quarter less any commissions paid that quarter.

So that means if you bought €10,000 worth of Irish shares in 5 different companies (total of €50,000) and held them with Davy for 5 years and bought no more – they would charge you €950 in maintenance fees and €250 in commission. a total of €1200 !

Signup at Davy Select here


Goodbody

The firm Goodbody has been involved in the Dubin Stock Exchange since 1874. Goodbody Stockbrokers was acquired by Fexco in 2011. They are regulated by the Central Bank of Ireland .

Fees at Goodbody

  • Charge of 1% on the first €25k of a transaction – then 0.5%. ( Minimum fee €25.)
  • Also – a charge of €25 is made on all US and European trades.
  • Maintenance Fee €100 year plus VAT
  • Foreign exchange fees – up to 1.25%

So that means if you bought €10,000 worth of stock in 5 different Irish companies (total €50,000 worth) and held them with Goodbody for 5 years and bought no more – they would charge you €500 in maintenance fees and €500 in commission. a total of €1000.
Sign up at Goodbody here



ETFs (Exchange Traded Funds)

ETFs are another way of investing in a portfolio of shares – read more about Investing in ETFs here
The stockbrokers listed above will allow you to buy and sell various ETFs as well as shares in single companies.

Stamp duty

Stamp duty is chargeable on the purchase of all Irish and UK shares. The rates are: 1% on Irish Shares and 0.5% on UK shares. This will be the same for all brokers.

Taxation of Shares

Capital Gains Tax (CGT) – if you make a gain on a share trade, the state is going to be looking for 33% of it as Capital Gains Tax . This is the same rate as the DIRT tax on deposit accounts. But – with CGT the first €1,270 of taxable gains in a tax year are exempt. There is no tax free exemptions with DIRT on deposits.
More here about Tax on Sales of Shares in Ireland

(See here for Information about Taxation of ETFs in Ireland)

Taxation of Share Dividends

If your shareholding gets paid a dividend, Revenue is going to look for some of that too in the form of income tax. PRSI and USC will also be due on the gross dividend and will be collected through the Self Assessment system (if applicable)

Dividends paid by Irish companies

Irish companies will always deduct 20% tax at source from the gross dividend. If you are liable for income tax at a higher rate you will pay tax on the gross dividend at the higher tax rate and be given a credit for the 20% tax already deducted.

Dividends on UK shares

You will be liable for Irish income tax on the net dividend received by you. No credit is allowed for any UK tax already deducted from the dividend payment. You must convert the net payment received to Euros and declare it on your Irish tax return form.

Dividends on US Shares

There is a 30% withholding tax on US dividends for non-US residents. If you complete a W8-Ben form, a lower 15% tax rate will apply. You need to declare the dividend income on your tax return and you will be liable for either 5 per cent or 25 per cent of the dividend in additional tax. (Depending on whether you pay income tax at 20% or 40%)

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