Benefits of Gross Roll-Up Investments

Investing through a gross roll-up structure, such as via life assurance policies, pension funds, or investment funds structured under Section 110 or life wrapper vehicles offers tax deferral and compounding advantages that can significantly enhance long-term investment returns.

Contact us today and book your consultation and see how Quigley Financial Brokers can help you choose the best options available or contact richard@quigley.ie for further information.

Here is a breakdown of the key benefits of gross roll-up investments in Ireland:

What is Gross Roll-Up?

Gross roll-up refers to the ability of an investment to accumulate returns (interest, dividends, capital gains) without being taxed immediately. Instead, tax is deferred until certain events occur like withdrawal, encashment, or maturity.

Tax Deferral = Enhanced Compounding

No tax is deducted on income or gains while funds remain invested.

Returns are reinvested gross, so your capital compounds faster than in taxed structures.

Over long periods, this compounding can result in significantly higher returns.

Timing of Tax Payments Is Controlled

You pay tax only when you withdraw or encash (unless automatic deemed disposal rules apply, see below).

This allows strategic planning for withdrawals (e.g. post-retirement when you’re in a lower tax bracket)

 Simplicity for Investors

You do not need to file annual tax returns for income and gains within gross roll-up funds.

The fund manager or life company typically takes care of the exit tax when due (see next point).

Taxed via Exit Tax (Not Income Tax/CGT)

When tax is eventually paid, it is often at the Exit Tax rate:

• 41% for individuals

• 25% for companies (if they are trading and can claim credit)

This is generally more favourable than top rate income tax (up to 52%) on regular income investments.

Widely Available Investment Options

Gross roll-up structures are used in:

• Pension funds (tax-free growth inside the pension)

• Life assurance investment bonds (e.g. investment funds offered by insurance companies)

• Unit-linked funds

• Section 110 structures (for sophisticated investors or corporates)

• Offshore investment wrappers with Irish tax compliance

Automatic Deemed Disposal Only After 8 Years

For some life funds or offshore funds, there’s a “deemed disposal” rule: tax is charged every 8 years even if no withdrawal occurs.

However, this still gives 8 years of tax-free compounding, and after the first deemed disposal, future gains compound again gross.

Estate Planning & Succession Options

Some gross roll-up products (e.g. life bonds) allow for:

• Tax-efficient transfer to heirs.

• Assignment to trusts

• Estate tax planning

Contact us today and book your consultation and see how Quigley Financial Brokers can help you choose the best options available.