What works where you live: tactical asset allocation after tax
After the tax rules of your country and your account, what is left of tactical asset allocation?
- Version
- 1.0
- Published
- Rules last checked
The short answer
It depends far more on your account than on your strategy. Where switching between funds is not taxed (Sweden's ISK, the Dutch Box 3, Hungary's TBSZ, an Israeli study fund), tactical allocation keeps most or all of its return. In ordinary accounts that let losses offset gains (Germany, Spain, Belgium, Hungary, Israel), tax costs about 2 points a year: most strategies stop beating the stock market, but a fifth to a third still beat a 60/40 with smaller falls. Where losses cannot be used (Ireland, Italy), most of the edge is gone. And slow strategies survive tax almost everywhere; fast ones almost nowhere.
The answer, account by account
107 unleveraged strategies that can be held entirely with European (UCITS) funds, from 2006-01 to 2026-08, with today's rules applied to the whole period. The tax cost is the median, in points of return a year. A strategy "holds up" when it beats a 60/40 after tax, held in the same account, and also falls less.
| Country | Account | Tax cost a year | S&P 500 after tax | 60/40 after tax | Strategies that hold up |
|---|---|---|---|---|---|
| Hungary | Long-term investment account (TBSZ) | 0.0 pts | 13.4% | 10.7% | 47 of 107 |
| Israel | Self-managed study fund (keren hishtalmut, IRA) | 0.0 pts | 11.1% | 8.4% | 50 of 107 |
| Netherlands | Box 3 investment account | 1.0 pts | 10.4% | 7.8% | 36 of 107 |
| Sweden | Investeringssparkonto (ISK) | 1.0 pts | 11.4% | 8.7% | 15 of 107 |
| Hungary | Ordinary account (controlled capital market trades) | 1.6 pts | 12.6% | 9.8% | 34 of 107 |
| Germany | Ordinary brokerage account (Depot) | 1.9 pts | 10.3% | 7.7% | 26 of 107 |
| Spain | Cuenta de valores (ETFs) | 1.9 pts | 9.8% | 7.4% | 24 of 107 |
| Belgium | Ordinary securities account | 2.1 pts | 10.9% | 8.1% | 21 of 107 |
| Israel | Ordinary account | 2.2 pts | 9.8% | 7.1% | 37 of 107 |
| France | Assurance-vie (unit-linked) | 2.6 pts | 9.5% | 7.0% | 28 of 107 |
| France | Compte-titres ordinaire (CTO) | 2.9 pts | 9.6% | 6.9% | 20 of 107 |
| Italy | Regime amministrato | 3.1 pts | 9.7% | 7.1% | 17 of 107 |
| Spain | Index mutual funds with traspaso | 3.2 pts | 9.8% | 7.4% | 17 of 107 |
| Sweden | Ordinary depot (aktie- och fonddepa) | 3.2 pts | 10.5% | 7.8% | 3 of 107 |
| France | Plan d'epargne en actions (PEA) | 4.4 pts | 10.4% | 6.3% | 28 of 107 |
| Ireland | Ordinary account (ETFs under exit tax) | 5.1 pts | 8.0% | 5.9% | 6 of 107 |
Returns a year in each account's currency (the S&P 500 returned 11.1% in dollars, 11.4% in euros, 12.4% in Swedish krona and 13.4% in forint), so compare within a row, not across rows.
Five things the numbers say
- The account matters more than the strategy. The same strategy loses nothing in a Hungarian TBSZ and about 5 points a year in an Irish account.
- Tax on wealth beats tax on gains, for a switcher. Sweden's ISK and the Dutch Box 3 tax the account's value, not its trades: about 1 point a year whatever you do.
- Loss offset is what makes an ordinary account livable. Germany, Spain, Belgium, Hungary and Israel all let losses reduce taxed gains: about 2 points a year. Ireland and Italy mostly do not: 3 to 5 points.
- "Tax-free" is not always free. A French PEA cannot hold bonds or gold, so the defensive half of most strategies becomes cash at 0%; Spanish index funds switch tax-free but have no gold; an assurance-vie charges a fee every year.
- Turnover decides who survives. Every switch with a gain is taxed, so slower strategies keep more.
What survives tax, and what does not
Across the 16 taxed accounts, the strategies that hold up most often are the slower ones:
- GGCEM Link Original (SPY/VEU, IEF/BIL): holds up in 14 of 16 accounts (annual turnover 2.0).
- KISS Combined 70/30: holds up in 14 of 16 accounts (annual turnover 2.7).
- LAA Standard (simplified): holds up in 13 of 16 accounts (annual turnover 0.3).
The fastest ones never beat a 60/40 after tax, in any of the accounts:
- VAA-G4 (T1/B1) (annual turnover 7.0)
- KDA Top 4 (annual turnover 5.2)
- Multi-Asset Momentum Standard (annual turnover 4.3)
- FAA (7 Assets) (annual turnover 3.8)
The full ranking of every strategy in every account is below for Pro members.
Every strategy, account by account
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Country by country
Each page explains the rules of each account, in plain words, with the sources and the date they were checked.
How we did it
- The monthly allocations of each strategy are those of its published backtest on BestFolio, with the same price history. Only strategies whose every holding has a UCITS equivalent at the same leverage are included.
- Prices are converted to the investor's currency every month (euro, Swedish krona, forint; dollars for Israel, where a foreign-currency gain can be computed in dollars).
- Each investor starts with the equivalent of EUR 100,000, so allowances and tax-free thresholds count as they would. Shares are matched first in, first out; trading costs 0.10% per trade; the year's tax is paid in January from the portfolio.
- At the end everything is sold, or the account's exit tax is paid, so buying and holding pays its deferred tax too. That is the fair comparison.
- Today's (2026) rules are applied to the whole period: the question is what these rules do to a strategy, not what an investor paid in 2008.
Limits
- Backtests, 2006 to 2026 (the currency series start in 2003). Not a forecast.
- Accounts with deposit caps (Israeli study fund, PEA, TBSZ) are modelled as if the whole sum fits; in practice some can only be filled over years.
- Not modelled: German church tax, Israeli surtax for high incomes, Belgian speculation risk on frequent leveraged trading, and the 2027 changes proposed in the Netherlands, Sweden and Ireland (Ireland's announced 35% exit tax would cut its cost from 5.1 to 4.7 points a year).
- Each account shows its sources and our confidence in the rules. Tell us if a rule is wrong or out of date.
Changelog
- Version 1.0, 2026-10-08: first release, 10 countries and 16 accounts. Next: the United States, Canada, the United Kingdom, Australia, Switzerland and Singapore.