Financial tax avoidance strategies: Reducing taxes through targeted investments

Financial tax exemption allows investors to reduce their tax bill while optimizing their assets. By choosing the right investment vehicles, it is possible to benefit from tax advantages while building long-term capital. Several options are available, including investment in SMEs, specific funds or products dedicated to supporting the economy, offering investment diversification. It's important to understand the eligibility criteria, tax ceilings and risks associated with each solution before making a decision.

Financial tax relief consists of reducing taxes through government-sponsored investment schemes. These schemes aim to direct capital towards priority sectors, such as real estate, innovation or local businesses. In return, investors benefit from attractive tax advantages that enable them to reduce their tax bill while diversifying their investments.

The main tax exemption schemes

There are a number of different schemes available to those wishing to invest and benefit from tax relief. Each offers specific opportunities to maximize tax savings while investing in promising sectors.

Loi Pinel: tax reduction through rental property

The Pinel law is a flagship scheme for taxpayers looking to reduce their tax bill. By investing in a new rental property, you can benefit from a tax reduction of up to 21% of the amount invested. In addition to reducing your tax bill, the Pinel law lets you build up a property portfolio and receive regular rental income.

Girardin Industriel law: investing in overseas France

The Girardin Industriel scheme enables you to benefit from a tax reduction by investing in the economic, energy or social development of French overseas departments and territories. This scheme is ideal for taxpayers with a high tax burden who want to combine a financial return with a positive impact.

The Malraux scheme: enhancing cultural heritage

The Malraux scheme is another tax exemption option for heritage enthusiasts. By investing in the renovation of properties located in conservation areas, investors can deduct up to 30% of renovation costs from their tax bill. This strategy combines profitability and preservation of France's cultural heritage.

Plan Épargne en Actions (PEA): tax advantages for equity investments

The PEA is another attractive tax tool. It allows you to invest in European equities while benefiting from a tax exemption on gains after a 5-year holding period. The PEA is ideal for those wishing to build up a stock portfolio while enjoying long-term tax relief.

Private equity offers an attractive alternative for those wishing to invest in unlisted, often fast-growing companies, while benefiting from tax advantages. By investing in this type of investment fund, investors are able to diversify their assets beyond traditional markets. However, it is important to note that these investments carry risks, notably of capital loss and illiquidity, as they are often locked-in over an extended period.

Eurazeo Wealth Solutions specializes in the management of private equity investment funds, positioning itself as a key player for investors wishing to support innovative, high-growth companies.

Private equity via FIP and FCPI: Support innovation and SMEs

The Fonds d'Investissement de Proximité (FIP) and the Fonds Communs de Placement dans l'Innovation (FCPI) are vehicles for investing in unlisted or innovative SMEs. By subscribing to these funds, investors can benefit from an income tax reduction of up to 25% of the amount invested. In addition to the tax reduction, these funds offer the opportunity to actively participate in the development of the French economy.

See also: FCPI Tax exemption
 

Life insurance is a very popular savings product in France, thanks to its tax advantages. Gains made on a life insurance policy are taxed at a reduced rate after eight years of ownership, so investing in life insurance allows you to optimize the transfer of your assets while benefiting from lower taxation. In addition to tax advantages, life insurance allows you to diversify your investments by investing in unit-linked products such as equities, bonds or real estate. Life insurance involves risks linked to the performance of the chosen investment vehicles. These returns are not guaranteed and may fluctuate according to market conditions.

Also read: Investment in SMEs Tax exemption
 

The Plan d'Epargne Retraite (PER) is a tax-deductible retirement savings plan. Payments made to a PER are deductible from taxable income, within the limits set by law. This strategy is ideal for those wishing to prepare for retirement while reducing their tax bill.

PER advantages

Unlike life insurance, the PER allows you to immediately deduct the sums paid in from your taxable income. This solution is particularly attractive for taxpayers with a high tax rate. At retirement, capital can be recovered in the form of an annuity or a lump sum, offering a degree of flexibility.

It should be stressed, however, that the PER entails a tax risk, as the sums withdrawn at retirement will be subject to taxation that may vary according to the exit method chosen, which could reduce the final amount received.

SCPIs are investment companies that enable you to invest your money in rental property without having to manage the assets directly. Some SCPIs, known as "tax SCPIs", offer tax exemption benefits, notably through the Pinel, Malraux and Déficit foncier schemes.

Tax SCPIs: how to reduce your taxes?

By investing in a tax-efficient SCPI, you can benefit from a tax reduction proportional to your investment. This type of SCPI is ideal for those wishing to access the property market without the constraints of management, while reducing their tax bill. By pooling investments, SCPIs offer a turnkey solution for diversifying assets while optimizing tax efficiency. However, as with any investment, there are risks involved, particularly in terms of property management and fluctuations in the real estate market.

To succeed in your tax exemption strategy, it's important to choose the right schemes for your profile and objectives. Here are a few tips to optimize your tax exemption.

Diversify your investments

To minimize risk and maximize tax benefits, it's essential to diversify your investments. Combine different investments, such as rental property, private equity and life insurance, to benefit from multiple tax advantages.

Define your financial objectives

Before any investment project, clearly establish your financial objectives: preparation for retirement, wealth accumulation, tax optimization, and so on. This will enable you to choose the savings solutions best suited to your needs, and effectively manage the associated risks.

Get expert advice

Tax planning is a complex business, requiring a sound knowledge of tax systems and financial markets. Calling on an expert will help you avoid mistakes and maximize your tax savings.

See also: Where to invest your money without being taxed

Eurazeo Wealth Solutions is a major player in private equity and investment in France. With solutions tailored to all investor profiles, including individual investors, Eurazeo Wealth Solutions helps investors implement effective tax-efficient strategies to reduce their tax bill while optimizing their wealth.Thanks to its high-level expertise and strategic partnerships, Eurazeo Wealth Solutions offers exclusive investment opportunities that reconcile tax reduction with long-term asset enhancement.

Private equity investments entail specific risks, in particular the risk of capital loss, illiquidity and volatility. It is essential to assess these risks carefully before committing to this type of investment.