An investment account is a tax benefit for individuals who invest through certain financial institutions. It allows you to defer the payment of personal income tax (PIT) until the funds are withdrawn from the account.
If you trade Forex or CFDs (contracts for difference) through the Admirals platform, this account may be recognized as an investment account if the conditions set out in the legislation are met.
What is an investment account?
According to Article 2, Part 381 of the Income Tax Act, an investment account is:
An account held by a permanent resident of Lithuania and declared to the State Tax Service, held in a financial institution operating in the European Economic Area (EEA), a member state of the Organization for Economic Cooperation and Development (OECD) or a state with which Lithuania has concluded a double taxation agreement.
The funds in the account must be used only for investments in financial products specified in Article 121 of the Income Tax Act, i.e. in:
- transferable securities (e.g. shares, bonds) traded on an exchange;
- derivative financial instruments linked to such securities (e.g. CFDs based on an exchange share).
Can a Forex trading account with Admirals be an investment account?
It depends on the specifics of your trading instruments:
It can be considered an investment account if:
- You trade derivatives (e.g., CFDs) that are linked to listed shares; however, not all CFDs qualify for the investment account regime, and eligibility is determined based on VMI guidance, not by the broker.
- You use an Admirals account that meets the requirements of the VAT Act, i.e. operates in the EU/EEA (e.g. Admirals Europe Ltd. registered in Cyprus);
- The account is declared to the State Tax Service as an investment account by submitting the FR0953 form via EDS.
It cannot be considered an investment account if:
- you trade only currency pairs (Forex) or other instruments not linked to securities traded on the exchange;
- you use an account whose funds are used speculatively (e.g. leveraged trading with cryptocurrency CFDs or OTC indices).
The VMI’s approach to CFDs and investment accounts
According to the explanation provided by the VMI:
“If a derivative financial instrument (contract for difference – CFD) is linked to shares traded on the exchange, it can be invested in with the funds of the investment account, and the return is taxed only when the funds are withdrawn from the account.”
What do you need to do to apply the investment account regime?
- Declare the opening of an investment account to the VAT by submitting the FR0953 form.
- Use the account funds only for investments in eligible financial products.
- Every year, declare:
- data on deposits and withdrawals, if any (via EDS);
- GPM311 form, if there was a withdrawal of funds exceeding the amounts deposited.
Useful Resources
Important
An investment account is a tax privilege, but requires declaration and accounting;
Forex accounts can be used as investment accounts only on the condition that appropriate instruments are traded;
Responsibility for correct declaration lies with the resident himself.
An investment account with Admirals can be an attractive option for those who want to invest in stocks and ETFs, with the potential for tax benefits depending on applicable rules, while offering a flexible trading platform.
However, it is necessary to follow the declaration procedure established by the Tax Inspectorate and regularly monitor tax news. More information about declaring an investment account can be found on the Tax Inspectorate website: FAQ
If you have additional questions or need assistance opening an investment account, please contact the Admirals customer service team or the Tax Inspectorate consultants.
For individual situations or detailed tax issues, it is recommended to consult with financial or tax specialists.
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