The Expat Assurance Vie
What is an Assurance Vie?
An Assurance Vie is a type of long-term life insurance and investment product available in France. It allows expats to benefit from the attractive tax advantages of holding investments within a managed account. The best Assurance Vie enables investors to select investments, including stocks, bonds, mutual funds and ETFs.
An Assurance Vie offers many advantages. One of them is that any capital growth from investments made within the plan are not taxed in France.
What are the main benefits of an Assurance Vie?
These investment accounts are ideal for expats in France looking to invest over the long term (8 years or more). Expats benefit from Assurance Vie accounts by reducing long-term capital gains taxes. This decreases overall taxation, and even offers free protection from creditors.
Plus, an Assurance Vie has other bonuses like favourable inheritance laws and flexible tax-free withdrawals. All of these features make this account an attractive option for expat investors looking for a way to save money whilst living in France.
Is an Assurance Vie suitable for everyone in France?
Investing in an AV is a great option for French nationals and residents. However, it must be made clear that it may not be suitable for everyone.
Expats not permanently residing in France should consider other investment options, given the lack of portability of the account. The Assurance Vie was designed to benefit those living and remaining in France only.
Secondly, an Assurance Vie can be complex. Its rules and regulations require research or financial advice in France. This may not be ideal for people who don't have time to dedicate to these tasks.
The Assurance Vie is not suitable for those looking for quick returns on investments. It is designed for a longer period of time, realistically at least 5 years or more as a minimum.
The Wealth Genesis and our team of experts are here to help expats. We provide regulated, unbiased, and independent advice. Our services are available globally. Get started today to learn more.
FAQs
1. What is an Assurance Vie Investment Account?
A locally compliant investment wrapper for French Nationals and Residents that offers certain tax benefits.
2. What are the benefits of an Assurance Vie Investment Account?
The main benefits of an AV are tax related. The investor gets gross roll up (compound interest) on all investments, and is entitled to a tax-free withdrawal each year. The account also offers Inheritance and French Wealth tax benefits.
3. How do I open an Assurance Vie Investment Account?
By contacting your local bank, or an independent financial adviser.
4. How do I contribute to an Assurance Vie Investment Account?
By requesting a payment form or bank details and transferring the funds to the custody account.
5. How do I withdraw money from an Assurance Vie Investment Account?
By contacting your bank manager or financial adviser who set up the AV.
6. What is the difference between an Assurance Vie Investment Account and a regular investment account?
A regular investment account will have capital gains tax due each year, and must be reported to the local tax authorities. An AV automates this process. Growth within the wrapper is not taxed until it is withdrawn.
7. Are there any risks associated with an Assurance Vie Investment Account?
Yes, all investments have risks. The value of what you invested may go down, and you may not get a return on your investments. There is a risk that the institution which holds your AV may go out of business. In this case, you must claim compensation from the relevant authorities.
