- New tax regime and exceptional tax allowance at 30%
- Sale of land and capital gains, comparison of tax regimes
With its new housing stimulus plan, the State seeks to reform the management of building land. It is in this context that, in September 2014, the various measures concerning tax rebates for the sale of building land come into play.
New tax regime and exceptional tax allowance at 30%
As it had been announced, the housing stimulus provides for a tax relief on capital gains on the sale of building land.
Since September 1, 2014these capital gains therefore change tax regime and now follow the rules already applied to buildings.
What must change in 2014 with the new regime:
- A tax exemption that goes to 22 years instead of 30 years. The exemption from social security contributions remains, however, fixed at 30 years.
- An exceptional and temporary reduction of 30%, applied to income taxes and social security contributions.
This allowance applies to the capital gains generated in the event of the sale of a building plot (subject to a sales agreement entered into before 31 December 2015).
- An abatement of 100,000 euros in case field donation. Accessible until the end of 2015, with the express condition that the land is then used for construction.
Sale of land and capital gains, comparison of tax regimes
Below, a comparative table of tax regimes for the capital gain on the sale of land, and an estimate of the gains allowed following the new abatement applied to income taxes and social security contributions.
|Length of detention of the land||Total taxation of the capital gain generated by the sale of land||Gains allowed by the new regime|
|Old regime||In 2014|
|After 1 year||34,5%||24,2%||- 10,4|
|After 2 years||34,5%||24,2%||- 10,4|
|After 3 years||34,5%||24,2%||- 10,4|
|After 4 years||34,5%||24,2%||- 10,4|
|After 5 years||34,5%||24,2%||- 10,4|
|After 10 years||34,5%||19,3%||- 11,8|
|After 15 years||27,6%||14,4%||- 13,2|
|After 20 years||22,1%||9,5%||- 12,6|
|After 25 years||13,8%||4,9%||-8,9%|
|After 30 years||0%||0%||0|
The new device is therefore intended to be more advantageous for the seller land to build.