The latest reform of the life insurance begins the attractiveness of this investment? What should we understand and how to adapt?

This is to its tax system and the estate if the life insurance has a tremendous success: not less than 54 million of open contracts, for a total outstanding of 1680 billion euros. But, the course of reforms, these benefits are trimmed.

The last provides tax, applicable from September 27, 2017, imposes a levy one-time lump sum (PFU) of 12.8%, which is comprised of a 17,20% in social security taxes -a taxation of 30%, constituting what is called the flat tax. Is it a new blow to the life insurance? Yes, but… not for everyone!

payments of short-term less taxed

You will be part of the big winners if you abondez a contract freshly opened (less than four years). So far, the gains were taxed at 35%, to 12.8 percent now, excluding social security contributions. For contracts older, but under eight years of age, the rate also decreases, at the margin: 12.8% in place of 15%.

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the good news for the investor do not please the insurers, who are afraid of “back-and-forth junk on the fund euro”, while they defend a “long term investment”, says Sonia Fendler, a member of the executive committee of Generali France, in charge of the customer’s property.

taxation of long-term differentiated

For contracts of more than 8 years, the tax will now be differentiated. “When the whole of the contracts has less than 150000 euros of premiums paid, net of redemptions possible, there is no change. It is positive for most savers,” says Sami Bérial, head of the department for heritage to the MACSF.

in other words, once consumed the abatement on the capital gains (that remains), of € 4,600 for a single person and 9,200 euros for a couple subject to joint tax, the tax will always be 7.5%, with 17.2% of social contributions, a total of 24.7%. On the other hand, for investors more wealthy, who can now rely on an amount of savings greater than 150000 euros, the tax is increasing slightly: it goes to 12.8% excluding social security contributions, or 30% including everything.

other contract to give them the choice

To manage the tax you will have to pay the year of the withdrawal of funds, it may be interesting to open already in another contract. If you opt for the schedule of the income tax act, this choice will be applied to all of your gains, regardless of the savings products from which they are derived.

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On the other hand, by opening a new contract, you will be able to, according to Sami Bérial, “make withdrawals on the contract of your choice and determine the best option for tax. Another advantage: it gives the opportunity to have a better performing product for its supply of funds (preferably from a variety of management companies) and fee level.