Reader question: When selling shares, is there a reduction in tax linked to the length of time since they were bought?
There used to be an allowance applied to the amount of the taxable gain for length of ownership, but it now applies only in the case of shares bought before 2018 and only if you opt to have all your investment income taxed under the income tax bands, as opposed to the ‘flat tax’ at 12.8% (plus 17.2% social charges).
So, whether or not this is advantageous might depend on what other investment income you have, such as dividends and interest, and which bands your income will rise into if the standard bands are applied.
If you opt for taxation under the usual bands, the allowance (money off the gain before it is taxed) is equal to 50% of the taxable gain for shares owned more than two years and less than eight, then 65% after eight years. It is only applied for calculation of income tax, not the social charges.
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