Records, Tax, and Jurisdiction

This is a chapter rather than a footnote because tax changes which strategies are viable, not merely how much you keep. A strategy that is marginally profitable pre-tax can be firmly negative post-tax, and the effect is largest for exactly the high-turnover strategies that beginners gravitate toward.

The figures below are Irish and current as of writing. Verify everything against Revenue and a qualified adviser - I am neither, this is not tax advice, and these rules change in most budgets. The structural lessons generalise even where the numbers don't.

Why turnover is taxed harder than it looks

Buy-and-hold defers tax until you sell, so gains compound gross. A strategy that realises gains every few days pays tax every year, and the compounding happens on the after-tax amount. Over a decade the difference is large and it does not appear in any backtest.

Compute after-tax expectancy, not gross expectancy, and do it before choosing a strategy family rather than after.

The Irish specifics

Capital gains tax is charged at <cite index="17-1">33% for most gains, with a personal exemption of €1,270 per individual per year - if your chargeable gain is below that, no CGT is due</cite>. <cite index="1-1">The exemption cannot be transferred between spouses or civil partners</cite>, and it does not carry forward.

Payment deadlines run ahead of the filing deadline, which catches people out: <cite index="14-1">tax is due by 15 December for disposals made from January to November, and by 31 January for December disposals, with the return itself filed by 31 October of the following year</cite>.

Losses may be offset against gains in the same year, and <cite index="5-1">unused losses can be carried forward to future years but not backward</cite>.

Stamp duty on purchases is a serious constraint on short-horizon equity strategies - <cite index="11-1">1% on Irish shares and 0.5% on UK shares</cite>. That is paid on entry, every time. A strategy turning over its book twenty times a year in Irish equities pays 20% of notional in stamp duty alone, which is not a strategy, it's a donation.

Crypto falls under normal CGT treatment: <cite index="12-1">Revenue has confirmed that profits from cryptocurrency disposals are subject to CGT at 33%, with the annual exemption and loss relief rules applying in the normal way</cite>.

The fund regime, which is the important one

Irish and EU-domiciled ETFs and investment funds are not taxed under CGT. They fall under a separate exit-tax regime, and the differences are severe.

<cite index="23-1">The exit tax rate is 38% for chargeable events including deemed disposals occurring on or after 1 January 2026, reduced from 41% by Finance Act 2025, and it applies to Irish-domiciled funds, life assurance policies, and equivalent offshore funds.</cite> <cite index="25-1">This was the first reduction in over a decade, following a recommendation from the Department of Finance's Funds Sector 2030 Review.</cite>

The rate cut is the good news. The structural problems survived Budget 2026 intact:

<cite index="23-1">Exit tax has no annual exemption, unlike the €1,270 CGT allowance; losses from one fund cannot offset gains in another; and the eight-year deemed disposal rule forces tax to be paid on unrealised gains - which makes fund taxation materially less favourable than direct share ownership.</cite>

On the deemed disposal specifically: <cite index="33-1">tax is levied eight years after an investment is made and every subsequent eight years regardless of whether a disposal actually occurs, charged on the gain from acquisition to the deemed disposal date, with any tax paid credited against the final liability on ultimate disposal</cite>. <cite index="24-1">Budget 2026 did not address the rule, despite the Government having previously signalled it would consider abolishing it</cite>, and <cite index="27-1">as of now deemed disposal remains law and anniversaries still trigger tax</cite>.

The practical consequences for a systematic trader:

• Every purchase starts its own eight-year clock. Monthly accumulation creates a rolling series of separate anniversaries, each requiring its own calculation.
• The tax is due whether or not you have the cash. You may have to liquidate part of the holding to pay it.
• No loss offset across funds means a portfolio approach is penalised: losing positions do not shelter winning ones.

The strategic conclusion for an Irish-resident trader: direct shares are taxed more favourably than ETFs, at 33% with an annual exemption, loss offsetting, and no forced disposal event. If your strategy can be expressed in individual equities rather than funds, that choice is worth several percentage points of annual return before you consider the strategy itself. Note also that US-listed ETFs may fall under different treatment depending on classification, that the classification is fact-specific, and that getting it wrong carries penalties - this is a question for an adviser, not for a book.

Records

Self-assessment means the burden is entirely yours. Log, per trade: instrument, direction, quantity, entry and exit timestamps, prices, all fees, the venue, and the currency with the exchange rate used.

Two things that are painful to reconstruct later and trivial to record at the time: FIFO lot tracking (which units were sold determines the base cost) and per-lot purchase dates for anything in the fund regime, because each lot's eight-year clock runs independently.

Automate this from day one. Your trading system already knows all of it; make it write a tax ledger as a first-class output rather than something you assemble from broker statements in October.

For readers elsewhere

The specifics differ; the questions don't:

• Is short-term trading taxed as capital gains or as income, and at what rate?
• Is there a transaction tax on entry?
• Are there tax-advantaged wrappers, and can your strategy operate inside one?
• Can losses offset gains, across what scope, and carried forward how long?
• Is there a distinction between "investor" and "trader" status, and which applies to you? In some jurisdictions this flips the entire treatment.
• Are there deemed-disposal or mark-to-market rules that create tax events without a sale?

Answer these before choosing a strategy family, not after your first tax return.