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Capital gains

Calculating and managing your capital gains

A capital gain is the profit made from the sale of a security, and therefore represents the difference between its sale price and its purchase price. Calculation, taxes… Here's everything you need to know about capital gains.

How are capital gains calculated?

The calculation method is simple:

Capital gains tax for French tax residents only

Capital gains realized on sales of shares are subject to income tax based on a progressive scale. However, the rate may be reduced by means of a tax deduction, depending on the length of time you have held your shares:

  • 50% for shares held between 2 and 8 years
  • 65% for shares held for longer than 8 years

The rate for social contributions is 15.5%. This rate is applied to the capital gain prior to any tax deduction.

Possible exemptions

There are two options that provide exemption from capital gains tax:

  • Having a share savings plan and keeping your shares inside for at least five years from the account opening date. The cash investment limit is €150,000 per plan. Shares cannot be transferred into a share savings plan from another account. Only transfers from the share savings plan cash account can be used to invest in shares. Social contributions are applicable to share savings plan
     
  • Making a hand-to-hand gift or donation provides total exemption from all taxes and social contributions up to the maximum limit set by French law. Please note however that a hand-to-hand gift must be included in the grantor’s estate in order to be valued and included in the allocation of the grantor’s assets
Capital gains and their taxation - Factsheet

Factsheet - Capital gains and their taxation

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