How to Buy Shares Online in Ireland

With the interest rates on savings accounts in Ireland so low , some people might be looking into alternative investment options for some of their money.
Buying shares is one method of potentially making a return from an increase in share value and also from dividends.


After sharp falls in share prices in March, there has been some good recovery in some share prices since then. Interestingly, we saw much larger numbers of people searching for ” How to buy shares in Ireland” and “how to buy stocks in Ireland” in the weeks after the stock markets fell.


There have been some huge share price rises in recent years of companies like Tesla , Amazon, Google, Facebook and Apple. So it’s understandable that people might want to try and make some money from stocks and shares.


Important

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


Stocks and Shares Explained

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


Stock
is the generic term for shares. The Stock Market is made up of various exchanges where shares are bought and sold by stockbrokers. These include the London Stock Exchange, New York Stock Exchange etc.
The Irish Stock exchange is known as the ISEQ.

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 in Ireland

The cheapest and easiest way to buy stocks and shares in Ireland 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.
You can buy shares with fees as low as 50c in some cases.


A comparison of the share trading fees at some online stock brokers that operate in Ireland.

We have compared the fees charged by DEGIRO, Interactive Brokers, Davy Select and Goodbody Online.

The fees shown are for buying or selling shares / ETFs. The figures were checked in October 2020. We did not include stamp duty in this comparison because it is the same for all providers.
(More about ETFs here)

In our comparison of online share dealing fees and portfolio management costs – DEGIRO came out as the cheapest.
In one example they
were 40 times cheaper than the most expensive alternative.


Share Dealing Charges Compared
TransactionsDEGIROInteractive
Brokers
DavyGoodbody
Buy €1000 of Irish shares
each month for a year
€30Not Possible
€200€423
Buy €10,000 worth of
US shares @ $10 each
and keep for 5 years.
€26.37$600
(€530)
€1025
€740
Buy €5000 of UK
shares and keep
for 2 years then
sell them for €6000
€29.50$240
(€210)
€400€346
Buy €1,000 of Euro
ETFs each month
for 5 years
€282.50$600
(€530)
€2399€3615

Review of Online Share Dealing Fees in Ireland

DEGIRO

Dutch firm DEGIRO launched its online stock brokerage services in 2013.
DEGIRO now operates in 18 European countries – including Ireland. the Investors Chronicle / Financial Times voted DEGIRO the Best Low-cost Stockbroker in 2018 and the best mobile share dealing app in 2019.
DEGIRO is regulated by the Netherlands Authority for the Financial Markets (AFM) and the Dutch Central Bank (DNB). It uses EU passporting rules to allow it to operate across the single market. Stock dealing can be carried out on the DEGIRO app or on their desktop site.

Fees at DEGIRO

  • Irish shares : €2 + 0.05% per trade
  • UK / European shares: €4 +0.05% per trade capped at a maximum of €60
  • US shares : €0.50 per trade + (USD 0.004 per share)
  • ETFs – some free otherwise €2 plus 0.03%
  • Annual fees – DEGIRO has an annual fee you for connecting you to exchanges. This fee is currently €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%

If you bought 1000 US shares worth €10,000 and kept them for 5 years , DEGIRO would charge you a total of just €25.76 including currency charges. See the table above to see more examples of DEGIRO charges compared with Interactive Brokers and other online stockbrokers.
You can sign up to DEGIRO here.

DEGIRO is partnered with Flatex Bank to hold client’s uninvested cash. Flatex bank is guaranteed by the German Deposit Guarantee Scheme. So all DEGIRO client’s uninvested cash is covered, up to €100,000.


Interactive Brokers

Interactive Brokers is a worldwide company and Irish residents will deal with the UK branch, Interactive Brokers U.K. Limited. They are authorised and regulated by the UK Financial Conduct Authority. Online share trading can be carried out on desktop or also on the IB app

Online Fees at Interactive Brokers

  • US shares $0.005 per share
  • Irish shares not available to buy.
  • UK Shares £6 per order up to £50k. (Over £50k = £6 = 0.05% Max £29)
  • Euro Shares 0.1% , Min €4 max €29
  • Maintenance Fees : Minimum commission of $10 every month. (This fee is waived if you have over $100k in portfolio

Their $10 minimum commission per month makes them an expensive option for most investors. If you bought 1000 US shares @$10 each and kept them for 5 years, Interactive Brokers would charge you $600 .
Compared with DeGiro – Interactive Brokers would be about €500 more expensive.


Davy Select

Davy stockbrokers are based in Dublin and are regulated by the Central Bank of Ireland. Minimum investment €500. Davy Select seems to be a popular site for people checking out Irish ISEQ share prices. You cannot buy or sell shares on the Davy app.

Online Share Dealing 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 .
  • Minimum Fee per trade for shares listed outside Ireland and UK 0.06%.
  • Foreign exchange fees max 1%.
  • Execution Service Fee of €50 per quarter ( less any commissions paid that quarter).

If you bought €10,000 worth of US shares with Davy Select and kept them for 5 years, Davy would charge you €75 in commission and €950 in execution service fees: a total of €1025 . Compared with DEGIRO – Davy online is €1010 more expensive.
See the table above to see more examples of how Davy compares to DEGIRO

Signup at Davy Select here


Goodbody

Goodbody has been involved in the Dubin Stock Exchange since as far back as 1874. Fexco bought Goodbody Stockbrokers in 2011 and they are regulated by the Central Bank of Ireland. You need to deposit a minimum of €5000 to open an online trading account with Goodbody.
Goodbody does not have a share trading mobile app.

Online Fees at Goodbody

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

If you bought €10,000 worth of US shares and kept them for 5 years- Goodbody would charge you €615 in maintenance fees and €125 in commission. a total of €740.
See the table above to see more examples of Goodbody fees compared with Degiro .
Sign up at Goodbody here



Alternative Share Buying Options

Revolut

Revolut only allows customers to trade selected shares on the New York Stock Exchange. They do not give access to stock markets in London, Dublin or Europe. Nor do Revolut allow trading of ETFs, index trackers or investment trusts.
Basic Revolut account holders get 3 free trades each month. Premium account holders get 8 free trades. After you use up your monthly free limit, trades are charged at £1 each.
For now, Revolut limits each trade to just US$1,000.
There’s a 0.01% annual custody fee. If you held £10,000 worth of shares in your account, you’ll be charged £1 a year.


RobinHood

In the USA a share trading app called Robinhood has become very popular with novice investors. Robinhood is not available in Ireland or in the rest of Europe. It is only available for use by residents of the USA. Their planned launch in the UK earlier this year was postponed and then abandoned.


Robinhood seems to make it easier and more attractive for less experienced investors to use more sophisticated investments such as “options”.
Options are a financial derivative that can give investors far greater exposure to a share price changes with an often small down payment. This can magnify gains but also potentially increase losses. Robinhood had some bad publicity after the suicide of a customer in the USA this year after he thought he had lost several thousand dollars on the app.


If you are interested in affordable share trading in Ireland – then, as our comparison above shows, Degiro is the best option.


ETFs (Exchange Traded Funds)

Exchange-Traded Funds (ETFs) are a good method of investing in a wider portfolio of shares. You can buy ETFs from all the stockbrokers we have listed above. An ETF, also known as a tracker, is a product that follows an index, commodity, bond or composition of products. You can think of it as a basket of shares.

Read more about Buying ETF Funds here.

Stamp duty on Shares

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. Unlike DIRT, the first €1,270 of taxable gains in a tax year are exempt from CGT. There are no tax-free exemptions with DIRT on deposits.


More details 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 want some of that in the form of Income-tax.
Additionally , PRSI and USC may also be due on the gross dividend. These will be collected through the Self Assessment system (if applicable)

Taxation of 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 the higher rate you will pay tax on the gross dividend at the higher rate and be given a credit for the 20% tax already deducted.


Taxation of 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.

Taxation of Dividends on US Shares

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

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