A A A

France – Private Wealth Portfolio

You can take advantage of the many benefits offered by Private Wealth Portfolio:

Exceptional Tax Efficiency  

Effective management of tax liabilities is essential to optimising wealth management. Private Wealth Portfolio has been designed to help you optimise your tax obligations:

  • Capital Gains Tax or Income Tax on investment growth within your policy is deferred until you make a surrender or on the death of the life insured. This offers a significant advantage over direct investments where you pay tax on gains on an ongoing basis.
  • This tax deferral may also reduce the administrative burden; tax is payable only when you make a surrender or upon the death of the life assured as opposed to each time an asset makes a gain.
  • If you make a partial or full surrender of your policy, any gain is subject to income tax and social taxes. However with Private Wealth Portfolio you can opt for prélèvement forfaitaire liberatoire (PFL) – a French capital gains tax which acts as a discharge of the income tax liability. PLF reduces your liability from a maximum of 60.5% to the following rates:
Length of time policy held PLF
Prélèvement forfaitaire liberatoire
Social Taxes (Prélèvements Sociaux) Total Tax liability
< 4 years 35% 15.5% 50.5%
4 – 8 years 15% 15.5% 30.5%
8 years > 7.5% 15.5% 23%
  • You can also benefit from a tax credit if you make a surrender on your Private Wealth Portfolio, provided that you have held it for eight years or more

Flexible estate planning  

Private Wealth Portfolio is a valuable instrument for the smooth transition of your wealth from generation to generation:

  • There are no restrictions in terms of named beneficiaries, who can be changed at any time (subject to the provisions of the law).
  • The amounts originally attributed to beneficiaries can be easily altered.
  • Your beneficiaries are subject to more favourable inheritance tax rates in the event of your death, provided that premiums are paid into the policy before the 70th birthday of the insured life.

Residence planning  

  • If you are internationally mobile or your family is living abroad, payment of capital gains tax is deferred until surrender* and is payable where you are fiscally resident at that time.
  • Private Wealth Portfolio is a non-French asset and this may be advantageous for French wealth tax purposes if you become a non-French resident. Non-French residents currently must pay wealth tax on their French assets unless they are exempt under a tax treaty.
  • If you have lived outside of France for at least five years, and you then move to or return to live in France, you are not liable to wealth tax on your policy until 31st December of the fifth year after the year in which you become a French tax resident.
  • * Withholding tax may be applied in some countries.

Currency choice  

You can choose the currency of your investment in either Euro, US Dollar, Swiss Franc or Pound Sterling. The minimum initial premium is EUR 500,000 or equivalent in these currencies.

The information provided is based on our understanding as at 30th May 2016. Fees and charges apply. There may be a delay in processing surrender payments where the investment portfolio contains illiquid investments. You should discuss the taxes, fees and charges applicable to Private Wealth Portfolio with your financial advisor before you apply for this product. Your financial advisor will provide you with the guidance and advice that you need to make Private Wealth Portfolio work effectively for you.