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Clarifying tax exemption Exemption of financial investments: impact and relief for non-residents
In a significant judgment, the Court of Cassation clarified that the financial investments of non-residents are exempt from the wealth solidarity tax (ISF), without differentiating financial investments from equity securities. The DAMY law firm is ready to support clients in Nice and Luxembourg who could be affected by this decision in litigation.
Judgment of the Court of Cassation:-
Before this judgment, article 885 L paragraph 2 of the General Tax Code (CGI) seemed to leave no doubt as to the exemption of financial investments. However, the tax administration adopted a different interpretation. The Court of Cassation has now established the principle of exemption from wealth tax for participations in companies held by non-residents. While the Court of Appeal had previously ruled that financial investments should be treated separately from equity securities and included in the ISF base, the Court of Cassation overturned this decision.
Seeking relief:-
This decision has important implications for a considerable number of non-residents who are entitled to reimbursement of sums paid in error to the French tax authorities. It is important to note that refund requests must be submitted to the tax authorities within two years from the date of tax registration.
It should be noted that due to the reform of the ISF which became IFI (Real Estate Wealth Tax), this case law will have a limited impact in 2022 because equity securities in companies are no longer included in the tax base. this particular tax.
If you are a non-resident likely to have been subject to the wealth solidarity tax and you believe you can benefit from the relief, it is essential to act in good time and submit your request to Tax Administration. Our experienced team at DAMY Law Firm can guide and assist you throughout the process, helping you navigate the complexities of tax disputes and obtain the refund you rightly deserve.
Please note that tax regulations are subject to change and it is recommended that you consult legal professionals to ensure compliance with the most current requirements and procedures .
