Analysis: As Ireland prepares to launch a new State investment account, the question is not which country to copy but which ideas to borrow
Ireland remains unusually cash-heavy. In July 2026, household bank deposits stood at over €170bn. The Central Bank estimates 38% of household financial assets are in cash and deposits, versus 30% across the EU, while just 2.3% are in listed shares and debt securities, compared with 7.5% EU-wide.
Cash is essential for emergencies and short-term spending, yet investing has often meant navigating different tax treatments and deemed disposal, where tax can arise on certain funds and Exchange-Traded Funds (ETFs) after eight years without a sale. As part of Budget 2027, the Government is planning a Personal Investment Account with a tax-free threshold, a low flat tax above it, no compulsory holding period, tax-free provider transfers, no deemed disposal inside the account and more tax administration handled by providers. The threshold, tax rate and contribution limit will be announced on 6 October.
That leaves the harder question: does all of this mean people will actually use it? A look at similar schemes across Europe suggests tax is not enough and the strongest systems combine a clear benefit, simple administration and an easy way to invest regularly.
UK: where the benefit is easy to understand
The obvious starting point is the UK’s Individual Savings Account (ISA). In 2026/27, a resident can contribute up to £20,000 across ISAs, with qualifying interest, dividends and capital gains sheltered from UK CGT. Around 15 million adult ISA accounts received subscriptions in 2023/24, with roughly £103bn contributed.
For Ireland, the lesson is not the £20,000 limit but the clarity. The warning is that several ISA types now have different rules making things more complicated than they need to: simple ideas can become complicated over time.
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From RTÉ News’ Behind the Story podcast, what do we know about the new state-backed investment scheme?
Sweden: simplify the taxation itself
Clarity is only one part of simplicity. Instead of calculating capital gains tax whenever an investment is sold, Sweden’s ISK tackles the tax mechanics and applies a standardised annual tax based on capital held in the account.
In 2026, the first SEK300,000, around €27,000, is tax-free; above that, the effective tax is 1.065% of the capital base. Trading and rebalancing are easier, although tax can still arise after a poor year. Almost 40% of Sweden’s population holds an ISK, making it a useful comparison for Ireland’s threshold-plus-low-tax approach.
Germany: make investing a habit
Sweden reduces tax friction, but Germany shows why behaviour matters too. In 2025, 14 million people held shares, funds or ETFs, while 5.3 million used investment savings plans.
The Sparplan makes small automatic monthly investments easy, often into diversified funds or ETFs. For Ireland, success could mean making €50 or €100 a month feel as normal as a savings transfer. Tax can create an incentive; habit can create an investing culture.
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From RTÉ Radio 1’s Drivetime, Irish Times’ columnist Cliff Taylor and financial advisor Nick Charalambous on the new Government-backed investment scheme
Italy: beware of too many policy goals
Once participation grows, another question appears: should the account also support domestic companies? Italy’s PIR does. Standard PIRs generally require at least 70% of the portfolio in qualifying Italian or Italian-linked companies and a five-year holding period.
Ireland may face the same debate. But more conditions can restrict global diversification, while product costs can erode the tax advantage. Helping Irish companies and helping households build diversified wealth are both worthwhile goals, but not always the same goal.
Poland: Ireland is not acting alone
Then there is Poland, also introducing Personal Investment Accounts, or OKI, from 2027. Up to PLN100,000 (around €23,000) can be exempt from a new asset-value tax, although only PLN25,000 can be savings-type assets. Above the exemption, the tax is expected to be 0.85% in 2027.
Both Ireland and Poland have strong bank-saving cultures and are building a simpler bridge from deposits into investing at the same time. Both countries can learn from one another.
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From RTÉ Radio 1’s Drivetime, who can afford the Government’s new investment scheme?
The real test for Ireland
The European Commission is encouraging member states to establish or improve savings and investment accounts with simple access, broad investment choice and straightforward tax treatment. Taken together, the lessons are clear. The UK shows the power of an understandable benefit; Sweden the trade-offs of simpler taxation; Germany the importance of habit; Italy the risk of too many conditions; and Poland shows Ireland is part of a wider European shift.
Arriving late may be an advantage, but policy design is only half the job. A simple customer journey, low barriers, clear communication and public information will determine whether people understand and use the account.
For generations, putting €100 a month into a savings account has felt normal in Ireland. Perhaps the real test will be whether, ten years from now, putting €100 a month into a diversified long-term investment feels just as normal. Let’s hope so.
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The views expressed here are those of the author and do not represent or reflect the views of RTÉ
