What should be done before the New Year to reduce taxes?
The end of the year is coming very quickly now and there is not much left to do to take advantage of the tax advantages for 2021. The lucky ones who have a life insurance contract of more than eight years can still make a surrender in order to to purge capital gains. Because they then benefit from an allowance of 4,600 euros. For example, if you have a 20% capital gain, you can withdraw up to 23,000 euros without tax [les prélèvements sociaux de 17,2% sur les gains restent dus, NDLR].
It is then sufficient to transfer the money back to a contract, preferably without entry fees, even next year, so that the capital gain is now considered as a premium. [un abondement de l’épargnant]. In the event of withdrawal in subsequent years, it will therefore be possible to take more earnings without taxation.
But, you have to pay attention to the value dates provided for in the general conditions, because they determine when the transaction will be recorded, and therefore the fiscal year. For traditional contracts, it is already too late. But for online life insurance, it is often applied within a day or two.
Is there still time to open a Retirement Savings Plan (PER)?
In many cases, this is no longer possible if one wishes to benefit from the deduction on taxable income 2021, the contracts will pass on 2022. But for PER who offer the subscription entirely online, without mail to send, it is still time. We accept them until Thursday evening. Most often it is the effective date of the contract, which is used by the insurer to determine the year in which the payment will be tax deductible.
Can we still make gifts tax-free now that Christmas has passed?
Yes, with “customary gifts”, it is in fact provided that gifts offered at the time of a party do not have to be declared. They are therefore not affected by donation rights. They do not have to be given on the exact date of the event, but within a short time.
Above all, we are now entering the period of New Year’s gifts, gifts offered on the occasion of the New Year. So until January 5, this should be accepted by the tax administration.
The customary gifts must, however, meet two conditions: that it is customary to give gifts during this period and that they are not excessive in view of the income and the financial situation. This last criterion is however left to the free interpretation of justice. When we look at the case law, we see overall that if we do not exceed 1% of the assets, we are probably staying within reasonable limits. If you have a million euros and you give 10,000 euros, you will of course have to be able to justify significant income.
For a transfer, it may be useful to have the reason indicated on the bank’s notice: “Happy New Year! ” for example. This makes it possible to attach the donation to the event and thus avoid a requalification.