Innovation funds offer the following tax advantages:
With respect to personal income tax, a subscriber benefits from a tax cut equal to 25% of the investment, with an annual cap of €12,000 for a person filing an individual return and €24,000 euros for a couple filing a joint return. Thus a couple investing €24,000 would reap a tax savings of €6,000, regardless of the tax bracket.
In order to qualify for this special innovation fund tax benefit, the subscriber must agree to hold the shares for a period of five years, be a tax resident of France, not hold more than 10% of the innovation fund shares at the family level nor more than 25% of the beneficial interests of companies in which the innovation fund holds shares.
With respect to capital gains taxes, subscribers receive an exemption on all capital gains (excluding social security withholding) where the investment has been held for more than five years.
Note: innovation fund shares managed by XAnge Private Equity may not be included in a company savings plan.
Additional note: the points described below involve just a general framework applicable in France. The actual tax status depends on the specific situation of each investor. If investors are uncertain as to their tax status, we recommend that they contact a tax consultant.
