The attention of shareholders is drawn to the fact that this presentation is a summary of the currently applicable tax system. It is given as general information and is not intended to constitute a complete analysis of all the tax consequences that could apply to a shareholder; it is therefore recommended that shareholders consult their usual tax advisor in order to study their specific situation.
The following provisions present the main tax consequences applicable to individual or legal entities that hold securities in their private assets and do not carry out stock market operations on a regular basis.
“Taxation of shares in France” means “Individual shareholders who are tax residents in France”.
Aligning capital income taxation with taxation of labour income
Taxation of dividends
Taxation: calculated from 1 January 2013, the option for dividends to be taxed at source is revoked; dividends received in 2013 are therefore automatically taxable based on the progressive income tax scale. In order to constitute an advance payment, they are subject to a mandatory levy of 21% at source, which will be deducted from income tax. The 40% allowance is maintained, although the fixed allowance of €1,525 or €3,050 depending on family circumstances is revoked;
Derogatory measure: households declaring a taxable income of less than €50,000 for a single person and €75,000 for a couple in their 2012 income tax return as well as in their income for 2011 may avoid paying this advance upon request;
Social security contributions: as they represent income from assets, dividends are subject to five social security deductions at source, totalling 15.5% for products received on or after 1 July 2012 (compared with 13.5% for those received between 1 October 2011 and 30 June 2012).
Please note that the rate of general social contributions deducted was reduced from 5.8% to 5.1% in 2013.
DIVIDENDS RECEIVED IN 2013
Social security: contributions 15.5%
Income tax: Progressive scale after fixed allowance of 40%
Taxation on capital gains from disposals
Capital gains from the disposal of shares carried out on or after 1 January 2012 are taxable in 2013 at a flat rate of 24% (compared with 19% in 2011) and for social security contributions at a rate of 15.5% (compared with 13.5% in 2011). This means that, from the first euro resulting from disposal, the total capital gains realised is taxed at a global rate of 39.5%.
Capital gains realised on or after 1 January 2013 are taxable in 2014 on a progressive income tax scale, with the application of an allowance calculated based on the length of time the shares were held: 20% if the shares were held for between two and four years, 30% if the shares were held between four and six years, and 40% if the shares were held for more than six years.
CAPITAL GAINS REALISED FROM 1 JANUARY 2011
Social security contributions 13.5%
Flat-rate tax 19%
CAPITAL GAINS REALISED FROM 1 JANUARY 2012
Social security contributions 15.5%
Flat-rate tax 24%
CAPITAL GAINS REALISED FROM 1 JANUARY 2013
Social security contributions 15.5%
Flat-rate tax Progressive scale with allowance for length of holding
Taxation on capital losses from disposals
Capital losses from disposals incurred since 1 January 2003 may be deducted from capital gains of the same nature realised during the year of transfer, or in the 10 subsequent years. This option is open from the first euro resulting from disposals for net capital losses, reported from 2011.
Shares in the company constitute shares eligible for the PEA. With PEAs, the taxable benefit is acquired at the end of the fifth year (for a standard eight-year term). If you do not retire before the end of the fifth year, the shares you hold as part of this account will be fully exempt from tax (excluding social security contributions) on the realised capital gains and dividends. Note that the payment limit of €132,000 for PEAs (€264,000 for couples) will be increased to €150,000 (€300,000 for couples).
The shares that you retain as part of your private assets will be included in your taxable assets and, where relevant, included in the calculation of solidarity tax on wealth. The value to be declared is preferably the closing price on the stock exchange as at 30 December 2012 (€9,109) or the average of the stock exchange price over the final 30 days of the calendar year (€8,613), with the latter price being the most favourable value.
Gifts or inheritance of shares according to French law Note that gifts are exempt from duty every 15 years, limited for each parent, grandparent or great-grandparent to €100,000 per child (since 17/08/2012), €31,865 per grandchild and €5,310 per great-grandchild.
Pursuant to article 115-2 of the French tax code, the free allocation by SUEZ of Company shares (or, where applicable, of allotment rights to fractional Company shares) to its individual or legal entity shareholders, is not considered to be a distribution of income from movable assets.
The profit from these preferential provisions is not subject to any condition for individual shareholders residing in France. As a reminder, the cost basis of Company shares (or allotment rights to fractional Company shares) received as part of the Contribution-Distribution operation is equal to zero.