(BFM Stock Exchange) – The 2024 income declaration campaign has been open since April 10. A spring tradition in which French taxpayers cannot cut. Among the income to declare, regulars of the financial markets will have to declare their successes but also … their capital losses.
CAC 40 records throughout the year 2024 were able to make certain investors forget how to declare market losses. In view of the performance of the index since January 1 (-3.74% at the end of Friday), it may be good to recall some tax subtleties to properly declare its stock market income. And don’t forget the losses.
Reminder of a capital gain and a capital loss
A plus where the value corresponds to the difference between the price of transfer of the securities (net of costs and taxes) and the acquisition price-or if they were received free of charge, the value chosen for the calculation of the donation or succession rights-or the subscription of the securities.
The stock market losses are deductible from the same kinds obtained elsewhere, and this year of the capital gain and over the following ten years in the event of “surplus”.
In detail, according to the general tax code, capital gains and losses recorded over the same year add up.
Then, if the capital losses exceed capital gains, the balance will be able to reduce future capital gains of the next ten years.
Otherwise, if the most capital gains go beyond the losses, therefore, the binding of capital gains can be reduced by the losses recorded over the previous ten years.
The important point is that the losses are therefore deduced from the gross capital gains, a principle laid down by the Council of State in 2015. If some old capital gains can benefit from a reduction for holding duration (50% when the titles have been held for at least 2 years, 65% when they have been at least 8 years), the imputation of the losses must be done before allowance.
It should be noted that these abatements can only be applied for securities acquired before January 1, 2018. “The capital gains from the sale of securities acquired or subscribed from January 1, 2018 are excluded from the field of application of the offtends”, specifies the tax site.
Since taxation to the single lump sum debit (PFU), in 2018, at 30% (12.8% for income tax + 17.2% of social security contributions), there is therefore no longer any reduction for holding duration.
On the other hand, the taxpayer can always make the choice of the progressive scale of income tax, as the tax site here underlines.
Rules which differ according to the date of acquisition
The tax rules therefore differ according to the date of acquisition. For acquired titles After January 1, 2018, The taxpayer, according to his heritage situation, will have to choose between the application of the PFU or the application of the progressive scale of income tax without the “Development duration” system.
Example of a taxpayer, single and without dependent children, which gives an added value of 100,000 euros thanks to the sale of securities acquired After January 1, 2018.Still in this example, ignoring this added value, its marginal tax tranche is 45% insofar as its other taxable income is 220,000 euros. This taxpayer also has a value on securities of 60,000 euros noted in 2024.
Choice 1: more and loss submitted to PFU
Choice 2: Application of progressive scale
The option for the PFU is therefore more interesting for this taxpayer.
The income tax option is “only winning” for relatively low income. “For tax households with modest income (around 29,000 euros annually), it is more interesting to opt for the progressive income tax scale”, explains to BFM Business Pierre Morizot, co-founder and managing director of Waltio.
For acquired titles Before January 1, 2018the same taxpayer must choose between the application of the PFU or the application of the progressive scale with the “Development duration” device.
Example of a taxpayer, single and without dependent children, which gives an added value of 100,000 euros thanks to the sale of securities acquired before January 1, 2018. By ignoring this added value, its marginal tax tranche is 45% insofar as its other taxable income is 220,000 euros. This taxpayer also has a value on securities of 60,000 euros noted in 2024.
Choice 1: more and loss submitted to PFU
Choice 2: Option for the proportional reduction of ordinary law (titles held for more than two years and under eight years)
*Up to the ratio between the amount of income submitted to income tax (capital gain after reduction) and the amount of this income subject to the CSG (capital gain before abatement).
The option for the PFU is therefore less interesting for this taxpayer.
>> Calendar, scale, new features … Find the special file “Taxes 2025: Everything to fulfill your income declaration” from the editorial staff of BFM Business.com
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