Buying Exchange Traded Funds (ETFs)

What is an ETF ?

Exchange Traded Funds (ETF) are essentially portfolios of shares managed by an investment professional. Shares in an ETF can be bought and sold through a stockbroker just like shares in any company. Some people refer to them as Index Funds .

Shares in Exchange Traded Funds or Index Funds are listed on stock exchanges, just like shares in individual companies. ETFs can provide individual investors with an opportunity to buy a varied portfolio of stocks, in the same way as if they were dealing in a single listed share.

An ETF, sometimes referred to as a tracker, is a product that follows an index, a commodity, or a composition of products. You can think of it as a “basket” of shares.

In recent years, it seems that investors have flocked to ETFs because they are easily tradeable and usually have low management charges.
You may be also interested in our article about Buying Shares or this page about Buying Fractional Shares

Diversification with ETFs

ETF s can be an easier and more cost-effective way for investors to achieve returns from say the S&P 500 or the FTSE 100 without having to purchase all the individual stocks. Exchange-Traded Funds offer a convenient alternative to purchasing all of the underlying stocks of a particular index. For most investors, ETFs offer a lot more diversification than you’d ever hope to achieve by building your own portfolio of shares. (Lower fees too usually)

Exchange-Traded Funds are also generally easier and cheaper to manage than a big portfolio of self-selected shares.
If you just own a small handful of individual shares, a poor performance from one share will have a much larger impact.

  • ETFs typically aim to track a specific stock market or index such as the FTSE 100 , FTSE 250 , ISEQ, S&P 500 etc.
  • ETFs have charges built in to cover the fund manager’s operational costs. These charges tend to be very low, often below 0.2% a year.

Of course – as with any stock market based investment there is always a risk of losing money.

Choosing Accumulating or Distributing ETFs

There are two types of ETFs

  • Distributing (DIST): they pay the dividends of the holdings to the investors.
  • Accumulating (ACC): they reinvest any dividends to buy other stocks.

This has implications for taxation because there is a 41% tax on ETF dividends in Ireland.
More about ETF taxation further down the page.

Some Popular ETFs

Vanguard S&P 500 : This tracker ETF tracks the performance of the Standard & Poor’s 500 Index that is comprised of the stocks of 500 large US companies.

iShares Core MSCI World UCITS
The investment objective of this Fund is to provide investors with a total return, taking into account both capital and income returns, which reflects the return of the MSCI World Index.

Vanguard FTSE AW (All World) : This ETF seeks to track the performance of the FTSE All-World Index. This is a market-capitalisation weighted index of stocks of global large and mid-cap companies in developed and emerging countries.

iShares MSCI World Broad exposure to a wide range of global companies within 23 developed countries. Covering 85% of the listed equities in each country.

iShares FTSE 100 : This tracker ETF follows the FTSE 100 index – the 100 largest UK companies trading on the London Stock Exchange.

iShares Euro Stx 50 – This tracker aims to reflect the return of the EURO STOXX50 Index. This is the benchmark index that measures the performance of the 50 largest companies in the Eurozone.

How To Buy ETFs in Ireland ?

If you take a look at our article about Buying Shares in Ireland – we compare the fees charged by some online stockbrokers available in Ireland. Most of the online brokers in the comparison will allow you to choose from a selection of European or UK ETFs. (DEGIRO , Davy , BUX Zero, Etoro, Goodbody, Interactive Brokers )

Some brokers will have a smaller selection of ETFs than others. Trading shares in an ETF will normally have the same brokerage fees as trading any other share – but the fees charged by some brokers can be many times greater than the cheapest option.

In our comparison below, the lowest fees for regular purchases of ETFs were available at BUX Zero (IF you opt for their Zero Order service).
If BUX Zero doesn’t have an ETF that you are interested in buying – then take a look at Degiro for their FREE ETF selection or Etoro for commission-free trades.

Fees On ETF Purchases Compared

Buy €1000 worth of an EU ETF each quarter for 5 years then sell for €30000Total Share Dealing Fees and Commissions
Bux Zero
(Zero Orders)
(Deposit & Withdraw USD)
DEGIRO (Free ETF Selection)€12.50
Bux Zero
(Market Orders )
(Not on the Free List)
Interactive Brokers€110
(Deposit & Withdraw Euro)

Bux Zero

Bux Zero is a mobile trading app available in Ireland with a good but small choice of EU ETFs available. (about 170 when we checked in December 2021)
The commission is €1 per trade. However , customers can also opt for a ” Zero Order trade – which will always be commission-free.

Zero Orders on BUX are executed at the end of the trading day, between 4 and 5 pm (Central European Time). Orders placed after 4 pm (CET) will be executed on the following day. The daily price fluctuation of ETFs will usually be low – so waiting till the end of the day should have little effect on a long term investment.
If the price differential at the time of the trade does exceed 5% for sell orders or 4% for buy orders, the zero-order is cancelled.

BUX Zero is regulated by the AFM, The Dutch Authority for the Financial Markets.

More about BUX ZERO here

Please note that Investing involves the risk of loss.


DEGIRO charges a commission of €2 plus 50c handling fee per ETF trade.
However – they usually offer commission-free trading on a selection of European ETFs. (About 200) – Terms and Conditions apply See Here .
The popular ETFs listed above were all in the DEGIRO free selection at the time of writing. (Dec 2021)
DEGIRO also charge a €2.50 annual fee per stock exchange used. – So a good tip is to try and buy all your ETFs on DEGIRO from just one exchange (Amsterdam / Paris etc) to save paying multiple annual exchange fees of €2.50.

Please note that Investing involves risk of loss.
More about DEGIRO here.

Buying ETFs on Etoro

EToro has a selection of about 260 ETFs that can be traded . Most of them seem to be US ETFS but there are some non US ETFs available.

Some examples of EU/UK ETFs that are available on Etoro include:
iShares Core MSCI World UCITS ETF
iShares Core FTSE 100 UCITS ETF
iShares Core MSCI Europe UCITS ETF
iShares S&P 500 UCITS ETF
X-trackers Stoxx Europe 600 UCITS ETF
Xtrackers Nikkei 225 UCITS ETF

When you buy one of the above EU ETF’s – it is just the same as buying shares in a company. Etoro doesn’t charge a commission – but there will be a 0.5% currency conversion fee if you deposit or withdraw Euros. (No conversion fees if you can deposit USD).
It is possible to buy fractional ETFs on Etoro (from as little as $10)

(Your capital is at risk. Other fees apply. For more information, visit

More about Using Etoro in Ireland

It’s important to note all non-EU ETF trades opened on Etoro by residents of the EU or UK are only available as CFDs.
With a CFD (Contract for Difference) – you don’t own the ETF, instead, you are basically agreeing to a contract with the broker to replicate market conditions and settle the difference (profit or loss) when the CFD is closed.
In order to replicate a simple BUY of an ETF – make sure you set the leverage to 1. Any higher than that will increase the risk of losses.
Profits from Contracts for Difference (CFD) are liable to Capital Gains Tax in Ireland. (Same as profits from shares)
More about CGT and Investments here

The fee to open a CFD on Etoro is 0.09% – so on a $1000 CFD the fee would be $0.90.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.
68% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

See more here on CFDs

Interactive Brokers

Interactive Brokers is a worldwide company and in Ireland, they are regulated by the Central Bank of Ireland . Online share trading can be carried out on a desktop or also on the IB app. Funds can be held in several currencies including USD, EUR and GBP.

Their fixed fee for Euro ETFs is 0.1% per trade – Minimum charge €4

ETF Fee Comparison on Monthly Purchases

Buy €1000 of an EU listed ETF once a month for 5 years. Sell for €90000Total Share Dealing Fees and Commissions including Stamp Duty
Bux Zero
(Zero Orders)
(Deposit & wthdraw USD)
(If on the Free ETF Selection)
Bux Zero
(Market Order)
(Not on the Free List)
(Deposit & withdraw Euro)v
Interactive Brokers
Davy €2550

What is UCITS ?

Many ETFs will have the letters UCITS mentioned in their name.
UCITS stands for “Undertakings for the Collective Investment in Transferable Securities”. This refers to a regulatory framework that allows for the sale of cross-Europe mutual funds.
UCITS funds are perceived as safe and well-regulated investments and are popular among many investors looking to invest across Europe.

Taxation of ETFs in Ireland

Taxation of Irish and EU domiciled ETFs

  • You are supposed to declare the purchase of an ETF on your self assessment tax return to Revenue.
  • Any dividends you receive from an ETF are subject to 41% tax. However, many ETFs accumulate dividends instead of paying them. Therefore, buying “Accumulating” ETFs rather than “Distributing” ones will simplify your tax returns and increase your overall return slightly.
  • When/If you sell an ETF you will be liable for 41% income tax on any gains made. It doesn’t matter if you keep the money with your brokerage, you still need to pay the tax on the gains.
  • If you don’t sell your ETF – then every 8 years you will be “deemed” to have sold it and will be liable for tax at 41% on any gains in the preceding 8 years. Whenever an actual disposal of an ETF subsequently occurs, a tax credit is given for the tax paid on the deemed disposal.
    If the ETF subsequently falls in value and you cash it in , you can submit a claim to the Revenue for overpaid tax due to deemed disposal.
  • All gains from ETFs (actual or deemed) including dividends, should be declared on your self-assessment tax returns each year. Some people are put off by the extra record keeping required for ETFs.
  • Any losses on other ETFs are not available for offset. So if you make a loss of €5000 on one ETF over 8 years – but make a gain of €10,000 on another over the same period – you will be liable for 41% tax on €10,000. You cannot deduct the €5000 loss.
  • PRSI or universal social charge (USC) are not due on ETF gains.

Taxation of US, EEA and other OECD domiciled ETFs

With ETFs domiciled outside the EU  – they are treated like individual shares for taxation purposes in Ireland.

a) If you get dividends you declare this to Revenue as income and pay your margin rate of tax on that income.
b) When you sell the ETF you will be liable for Capital Gains Tax of 33% on any profit above €1,270 per annum. More here on CGT on Shares

Note : Irish investors have been restricted from purchasing US-domiciled ETFs since January 3rd 2019. But you can use CFD’s on Etoro (without leverage) to invest in USA ETFs without actually owning them.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.
68% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Investment Trusts Vs ETFs

Investment Trusts can be seen as an alternative to EFTs.
Some people prefer them because the tax on Investment Trusts is lower than on ETFs.

An investment trust or investment fund is made up of a collection of underlying stocks or other financial instruments. However, an investment trust/fund will be actively managed by a fund manager. This means that the contents of the fund are often reviewed and can change over time. The charges for an actively managed fund will be higher than that of a passively managed tracker/ ETF . Charges on an investment trust tend to range between 0.5% – 2.00%. Like trackers, these costs will usually be included in the price of the product.

Investment trusts are funds that are publicly listed as companies on a Stock Exchange, and so are traded like any company shares. By buying shares in an Investment Trust you are getting exposure to many different assets with just one investment. (In a similar way to Exchange Traded Funds) .
EFTs will typically track an Index (FTSE100 , S&P500 etc) – but Investment Trusts are typically invested in a smaller, handpicked selection of companies or other assets/bonds/gold etc. As with all shares – their value can decrease as well as increase and you are at risk of loss.

Some popular UK based Investment Trusts include:-

  • Scottish Mortgage Investment Trust (SMT),
  • Edinburgh Worldwide Investment Trust ,
  • Templeton Emerging Markets Investment Trust
  • All of these are available on Degiro for Irish customers.
  • SMT was also available on Etoro at the time of writing.

Taxation of Investment Trusts

If you buy shares in Investment Trusts – there are no specific guidelines from Revenue on how they are taxed in Ireland. But we understand that they are treated like any other share and that any dividend income will be taxed at your marginal rate of income tax and any gains will be taxed at the CGT tax rate of 33%. (First €1270 of gain a year is exempt). (This is our opinion – and not financial advice)

Investment Trusts are NOT treated the same way as ETFs for tax purposes.

Taxation of Stocks and Shares in Ireland

Comparison of Stockbroker Fees in Ireland