The Finance Ministry of the government of France has clarified the regulations related to the wealth tax cap (ISF) and life insurance contracts.
The ISF, income tax, the general social contribution (CSG), and the contribution for the repayment of social debt (CRDS) are currently limited at 75% of the income. However, the new regulation reduces the taxpayers’ wealth tax bill if the amount of tax due surpasses 75% benchmark, according to Tax News.
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The government has published the details of the specific income to take into account when calculating the ISF cap in the Official Journal on 14 June 2013. The new regulation of the Tax Administration has broaden the scope of the ISF cap by including the annual income derived from capitalization contracts and bonds, as well as income generated from other similar investments, notably life insurance contracts taken out with insurance companies located in France or abroad into it.
The new regulation from future instances will take the interest derived from euro fund life insurance policies (be it mono- or multi-based) into consideration while calculating the ISF tax shield.
The ministry has also set 15 October 2013 as the deadline for filing "corrective" ISF tax declarations.
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By GlobalData
