Taxation of life insurance : the presidential candidates will review their copy

As in 2012, in the framework of the presidential election, candidates looking to review the taxation of life insurance, the preferred investment of the French. And as in 2012, in front of the bronca of insurers and associations of investors, one by one, they are back. Macron on the last.

On march 9, the French Federation of Insurance took advantage of the presentation of the balance sheet 2016 the sector to move to the questioning of the present tax system for life insurance. Several candidates programmaient in fact, in this same period, a rate of taxation of income from assets to 30%, life insurance contracts included.

at the present time, the gains (the share of interest included in the amount withdrawn) is imposed, after 8 years, to 23% (up 7.5% after the allowance and 15.5% of social taxes). And to pass on the message, the French Federation of Insurance has put forward a survey of investors, where 85% indicated host adversely a burden of taxation.

A position is relayed also by the association of investors, the Afer. But it goes further by asking the candidate to decide on a catch-up of various caps including relief and never revised upward since their application, and the removal of the tax rate to 7.5% under the condition that the contract is invested long term in the real economy.

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Reculades and advanced

Message received ! On Thursday 16 march, the Afer was holding its sessions, where representatives of the candidates have developed their projects in terms of savings and respond to the claims.

Without waiting for this appointment, on Monday last, in trouble, French prime minister François Fillon has no "what ifs". In an interview given to les Echos, he stated that the standardization of the taxation on capital income, with the re-establishment of the flat rate for the taxation of income from assets to 30%, does not apply to life insurance or the booklet Is on the way. Initially, this was not the case. François Baroin, who represented him, confirmed on Thursday that the tax framework is not finally changed by 2022.

on The side of Emmanuel Macron, who wishes that the life insurance be taxed as any other income property to 30%, Jean Arthuis, his representative, has clarified things in the face to the members of the Afer, indicating that the rate of levy one-time lump sum on the investment products would apply only to new contracts of life insurance where the payments would exceed the ceiling of the savings plan in shares (PEA), which is currently € 150,000.

Below this threshold, no change to the rules that apply today. In return, he has announced the release of the life insurance of the base of the heritage subject to the solidarity tax on wealth (ISF). An ad that's not really a, since the other candidate running ! provides for in its program that the ISF is calculated as the value of the estate assets.

And in the nominee of the primary of the Beautiful people's alliance, Benoît Hamon, there was no debate. In effect, his representative, Jerome Guedj has confirmed the absence, in its programme, of any provision challenging the present tax system, considering the life insurance business as "the effort of a job".

towers of the screw tax very regular

These pronouncements are hardly surprising. At the end of 2016, there was in France nearly 54 million contracts. 44% of French people have subscribed at least to a contract. All are voters... Yet, in small touches, the taxation of life insurance has become less accommodative, including in the mandate of François Hollande.

From its inception, the life insurance has benefited a tax regime attractive : a total exemption. In 1983, François Mitterrand decides to put a stop to this principle. All new contracts since that time are partially taxed according to the dates of payment. It is the insurers that calculate the amount that must be charged in case of redemptions.

In 1997, the Jospin Government gives a new shot of knife and puts in place the rules that still apply today : the withdrawals on contracts entered into after September 25, 1997, are subject to income tax or final withholding tax of 35% if they occur during the first 3 years, the withholding tax of 15% if they are made between the 4th and the 8th year of ownership of the contract and the final withholding tax of 7.5% beyond 8 years. The contracts invested in shares being exempt from taxation. As a reminder, this is the part of interest included in the amount withdrawn that support such taxation.

Finally, since 1 July 2011, the gains on the contracts in units of account or in euros are subject to social contributions. A system strengthened in 2013, in which, since 26 September, it has been put in place a schedule that takes into account the seniority of the gains. More gains are older, less social contributions are high, or even completely disappear for those acquired prior to February 1, 1996.

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Taxation life insurance

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In fact, the taxation of life insurance has become a real gas plant. The suppression of the response ministéfound Bacquet has been a small step towards the simplification with a clear life insurance outside of the estate. But for many other aspects, this remains a complex issue. And if the real reform was not simply a simplification of the current rules, whilst retaining their key principles ?