Last updated on September 12th, 2023 at 07:17 pm
If you’re moving to France, there’ll certainly be a lot to get to grips with. This includes the thorny but hugely important issue of income tax: how it works in France, who has to file tax returns, and the key dates to keep in mind. We’ve put together this quick guide to the whole process, so let’s take a closer look.
Who needs to file a tax return in France?
Anyone living in France and earning more than the tax-free threshold, which at the time of writing is €10,084, must file an income tax return.
Back in January 2019, France adopted a Pay as You Earn (PAYE) tax system, meaning that employers automatically withhold the amount you need to pay in income tax from your salary. For example, at the time of writing, 11% of tax is payable on an income of between €10,085 and €25,710.
This PAYE system means that, as an employee, you’ll pay your taxes incrementally throughout the year. But it’s important to note that you will still have to file an annual tax return, either as a single person or as a couple/household.
When does the tax return have to be filed by?
The French tax year is identical to the calendar year, running from 1 January to 31 December. The deadline by which you must submit the form varies depending on which administrative district, or département, you’ve settled in. The date may also change from year to year, so it’s crucial to keep an eye out for when the dates are announced.
How can the tax return be filed?
It’s mandatory to submit the tax return online through the official government site, with certain exceptions. For example, if you’re unable to do so due to lack of internet access or disability, or if you’ve recently moved to the country.
In the latter case, you can post a paper form – Cerfa no. 2042 – which can be downloaded from the government website. Any relevant ID documentation required, such as your passport or visa, will be outlined on the form. Once you’ve fulfilled this obligation in your first year, you’ll be given your unique tax identification number, also known as your SPI number. You will then be able to create a personal online account on the government website, so you can file your next tax return online.
The online tax return form will usually be pre-filled with the relevant income information, meaning that all you’ll have to do is simply check the details are still correct. Remember to notify the tax office if you have a change in circumstances – for example, if you’ve moved house or got married or divorced.
Depending on your circumstances, you may be entitled to claim deductions from how much you pay in income every year. At the time of writing, these tax credits can include:
- 50% of the cost of out-of-home childcare (e.g., nursery fees) for children under six, up to a maximum of €1,150 per year.
- 50% of the cost of hiring a domestic worker, up to a maximum of €7,500 in the first year and €6,000 after that. This increases by €1,500 per child, up to a maximum of two children.
- Tax reductions for children in secondary school (€61 for college and €153 for lycée), and university (€183).
- A percentage of the cost of installing energy-saving heating and power generation technology, depending on your specific circumstances.
- A percentage of the amount you give to charity, depending on the type of charity it is.
What happens after the tax return is filed?
Once your tax return has been processed, you’ll receive a tax notice. This will provide a summary of your financial situation with regards to tax, and also let you know if there’s a balance to be paid, in the event that too little tax was taken during the last financial year. Alternatively, it may inform you that you’re due a tax refund.
If some more tax is owed to the government, this will automatically be withdrawn from your bank account. At the time of writing, the full amount will be taken if it’s €300 or less. If the amount you owe is greater than that, the payment will be spread over four monthly instalments.
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