What is the overall cap on tax loopholes?

Verified 01 January 2024 - Legal and Administrative Information Directorate (Prime Minister)

The overall cap on tax benefits (tax niches) is to limit the amount of tax benefits you can receive each year for the purpose of calculating income tax.

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General case

For the 2024 taxation of your 2023 income, your total tax benefits cannot provide you with a reduction in the amount of tax owing greater than €10,000.

Example :

For a tax shelter which benefits from home employment tax credit of €6,000 and a tax reduction for Pinel rental investment of €5,000.

€6,000 + €5,000 = €11,000.

The amount exceeds the overall cap limit.

Your tax benefit is therefore limited to €10,000.

FYI  

the cap is the same for all tax households, whether you are alone or in a relationship, with or without a dependent.

Tax advantages the affected may take one of the following forms:

  • Deduction from your taxable income
  • Tax reduction
  • Tax credit

The global cap applies to tax benefits granted in return for a benefit or investment.

The overall cap does not apply the following tax advantages:

  • Benefits related to your personal situation
  • Benefits of pursuing an objective of general interest without consideration
Tableau - Overall cap according to tax benefits (non-exhaustive list)

Purpose of the tax advantage

Global cap

Employment of an employee at home

Yes

Child care expenses for young children

Yes

Rental investment

Yes

Forestry investment

Yes

Subscription to the capital of SOFICA

Yes

Subscription to SME capital

Yes

Overseas investment

Yes

Establishment costs for dependants

No

Donations to general interest organizations

No

Effects of family quotient

No

Children's school fees

No

Assistance for the elderly/disabled

No

Please note

for a complete list of the tax benefits affected by the cap, see the practical income tax brochure. This document also informs you about the application and calculation of the cap.

Overseas investment

For the 2024 taxation of your 2023 income, if you also made investments overseas, the total of your tax benefits cannot provide you with a reduction in the amount of tax owing greater than €18,000.

FYI  

the cap is the same for all tax households, whether you are alone or in a relationship, with or without a dependent.

Tax advantages the affected may take one of the following forms:

  • Deduction from your taxable income
  • Tax reduction
  • Tax credit

The global cap applies to tax benefits granted in return for a benefit or investment.

The overall cap does not apply the following tax advantages:

  • Benefits related to your personal situation
  • Benefits of pursuing an objective of general interest without consideration
Tableau - Overall cap according to tax benefits (non-exhaustive list)

Purpose of the tax advantage

Global cap

Employment of an employee at home

Yes

Child care expenses for young children

Yes

Rental investment

Yes

Forestry investment

Yes

Subscription to the capital of SOFICA

Yes

Subscription to SME capital

Yes

Overseas investment

Yes

Establishment costs for dependants

No

Donations to general interest organizations

No

Effects of family quotient

No

Children's school fees

No

Assistance for the elderly/disabled

No

Please note

for a complete list of the tax benefits affected by the cap, see the practical income tax brochure. This document also informs you about the application and calculation of the cap.

Investment Sofica (cinema)

For the 2024 taxation of your 2023 income, if you have made investments in the cinema (Sofica), the total of your tax benefits cannot give you a reduction in the amount of tax due greater than €18,000.

FYI  

the cap is the same for all tax households, whether you are alone or in a relationship, with or without a dependent.

Tax advantages the affected may take one of the following forms:

  • Deduction from your taxable income
  • Tax reduction
  • Tax credit

The global cap applies to tax benefits granted in return for a benefit or investment.

The overall cap does not apply the following tax advantages:

  • Benefits related to your personal situation
  • Benefits of pursuing an objective of general interest without consideration
Tableau - Overall cap according to tax benefits (non-exhaustive list)

Purpose of the tax advantage

Global cap

Employment of an employee at home

Yes

Child care expenses for young children

Yes

Rental investment

Yes

Forestry investment

Yes

Subscription to the capital of SOFICA

Yes

Subscription to SME capital

Yes

Overseas investment

Yes

Establishment costs for dependants

No

Donations to general interest organizations

No

Effects of family quotient

No

Children's school fees

No

Assistance for the elderly/disabled

No

Please note

for a complete list of the tax benefits affected by the cap, see the practical income tax brochure. This document also informs you about the application and calculation of the cap.

Income tax: 2024 income tax return for 2023

Published on 1 January 2024

This page is up to date for the 2023 tax return.

However, the forms, online services and information documents are not yet available for the 2024 campaign. They will be made available online as soon as they become available.

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