A single rate that is nothing of the sort

Mrs Anselme collects 12 000 € of dividends and remembers she will be taxed at 12.8 %, that is 1 536 €. The levy will come to 3 768 €. The rate she memorised is correct; it names only one of the two components of the charge. Before you read on: what does the 2 232 € gap cover?

Two tiers under one name

The single flat-rate levy wears its adjective badly. It adds together two distinct charges, which share neither their nature, nor their recipient, nor their rules: an income tax at the flat rate of 12.8 %, and social levies.

Article 200 A of the tax code sets the first tier. Investment income and gains on the sale of securities are taxed at a flat rate of 12.8 %, by way of derogation from the progressive income tax scale.

The second tier is added automatically: the social levies on wealth and investment income, whose overall rate has been 18.6 % since 1 January 2026. The sum of the two gives the well-known overall rate of 31.4 %.

It is this figure, and not 12.8 %, that must be kept in mind when assessing an investment. Remembering only the income tax rate understates the charge by nearly 60 % — the most common planning error on this subject.

Capital gains follow the same path

Net gains on the sale of securities and corporate rights fall under the same article and the same rate. A securities account producing an 8 000 € gain therefore bears 31.4 %, exactly as if it had distributed 8 000 € of dividends.

One difference from current income nevertheless remains: the gain is computed after offsetting capital losses of the same kind, whether recorded in the same year or carried forward from the previous ten years. It is the net result that is taxed, not each sale in isolation.

Holding-period allowances still exist, but their scope has closed: they apply only to securities acquired before 1 January 2018, and require the election for the progressive scale. They are therefore no longer a lever for a recent portfolio.

Which income is concerned

The scope is broad: dividends and profits distributed by companies subject to corporate income tax, interest on fixed-income investments, proceeds of capitalisation bonds and contracts, and gains on the sale of securities and corporate rights.

The regime applies by default, with no step to take on the taxpayer's part. That is the point the text states without ambiguity: absent any choice expressed by the taxpayer, income is subject to the flat-rate levy. Doing nothing is therefore a choice, and not always the right one.

Some products escape the scheme entirely. Interest on the Livret A, the sustainable development savings account and the popular savings account is exempt from income tax and from social levies alike, and is not reported at all: for these accounts, the question of the flat-rate levy simply does not arise.

One last point of vocabulary avoids a good deal of confusion. The levy withheld by the bank at the time the income is paid is not a final discharge: it does not settle the tax, it anticipates it. The income must nevertheless still appear on the return filed the following year.

This mechanism explains why the amount shown on the bank statement and the amount finally due almost never match. The difference is settled when the tax is finally assessed, in one direction or the other, and that is entirely normal.