2023-10-03 06:25:29
There are still opportunities to reduce your taxes before the end of the year. (Photo credit: Shutterstock)
There is still time to implement tax exemption strategies for your 2023 income. Discover investment solutions to reduce your taxes before the end of the year.
As the end of the 2023 tax year quickly approaches, tax exemption is becoming a hot topic for everyone looking to reduce their income tax. Fortunately, there are still opportunities to reduce your taxes before the end of the year. In this article, let’s explore various tax exemption solutions.
The Retirement Savings Plan (PER)
The PER is a savings product allowing you to build up capital which will be redistributed to you when you retire. It offers significant tax advantages. Indeed, voluntary payments are deductible from your taxable income, within the limit of a ceiling set at 10% of professional income, or 32,909 euros for 2023. You also benefit from the ceiling of the previous three years if it has not not been used. The tax advantage of the PER becomes especially interesting from the marginal tax bracket at 30%, and even more so for taxpayers taxed at 41 and 45%.
Self-employed workers have a specific ceiling equal to 10% of their taxable profit (within the limit of eight times the PASS 2023), to which is added 15% of the fraction of the taxable profit between one and eight PASS 2023, i.e. a maximum deduction of 81,384 euros.
Real estate
Tax-exempt real estate, via measures such as the Pinel Law and the Malraux Law, offers significant tax reduction opportunities. Each scheme has its own eligibility conditions.
The Pinel Law allows an income tax reduction equal to 12%, 18% or 21% of the amount invested (within the limit of an investment of 300,000 euros) in new real estate. In return, you must agree to rent the property for 6, 9 or 12 years respectively and to respect the rent and resource ceiling for tenants.
Investment under the Malraux Law is also possible, allowing investment in the restoration of buildings protected as historic monuments. Its advantage is 22 to 30% of renovation expenses depending on the location of the property.
Investing in woods and forests
You can invest in woods and forests via a forestry investment group (GFI). If it is a GFI currently being created, a 25% reduction applies for a maximum investment of 50,000 euros for a single person and 100,000 euros for a couple. For an acquisition of GFI shares on the secondary market, the reduction is 18% up to a limit of 5,700 euros for a single person and 11,400 euros for a couple.
Furthermore, this investment is also of interest to those who wish to prepare for the transfer of their assets since it allows them to benefit from a 75% tax reduction on inheritance tax.
Support regional or innovative businesses
FIPs (Proximity Investment Funds) or FCPI (Innovation Mutual Funds) allow a significant tax reduction while supporting regional or innovative companies. FIPs invest in regional SMEs and FCPIs in innovative SMEs not listed on the stock exchange. Subscribers to FIP and FCPI shares benefit from income tax reductions of 25% in 2023 (30% in Overseas and Corsica). The maximum investment is set at 12,000 euros per person or 24,000 euros per couple.
Support cinema
Companies for the Financing of the Cinematographic and Audiovisual Industry (SOFICA) are investment vehicles which make it possible to finance cinematographic or audiovisual works. In return for this investment, it is possible to benefit from an income tax reduction equal to 30% of the sums paid, and up to 48% for certain enhanced SOFICA (very low budget films or series). The amount of payments is limited to 18,000 euros per year and per tax household.
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