French income tax 2021: Update
Last-minute changes in French income declarations this year include some changes to box locations on the paper forms, and new boxes for declaring small business income that benefited from social charges relief related to the Covid-19 pandemic. There are also some changes to the 3916 form for declaring overseas accounts.
This information is an addendum to our French Income Tax 2021 help guide.
ONLINE submissions for French income declarations are now open and paper forms are being sent out.
Contrary to last year’s policy, paper forms will be sent out this year to households unless they declared online in both 2019 and 2020 (in 2020 they were only sent out to those who had declared by paper in 2019).
This year changes to online declaration sections or equivalent paper forms as compared to last year are relatively minor (see below for more).
One new aspect is a chatbot which is is located in your secure online messaging space on the tax website and is meant to help with simpler queries.
The declaration dates this year have returned to a more typical pattern after 2020 in which they were delayed slightly due to the Covid-19 health crisis.
The deadline dates (all at midnight) are:
Declarations by paper
Both residents and non-residents – May 20 (the post date stamp on the letter is used to check)
Departments 01 to 19 (and non-residents) – May 26
Departments 20-54 – June 1
Departments 55-976 – June 8
Your avis d’impôt income tax statement will be available in your online space from July 26 / August 6 onward, department dependent. Those who have not opted out of a paper avis will receive this between July 30 and September 7.
This new system for those with very simple declarations enters its second year.
A greater number of people will benefit this time as the ‘automatic’ declaration sent for checking will include certain pre-filled information that people have self-reported in their personal space during the year, such as the birth of a child.
Those concerned who declared on paper in 2019 or 2020 will receive a document in the post, for others it will be online in their personal space.
If you have anything to add or change, you must complete a standard income declaration.
Accessing your online space
This year there is an additional security factor – you are likely to be asked, when logging in to complete your declaration, to provide a mobile phone number to which a code will be sent.
If you have income that has been declared to the tax service by certain online platforms for letting property or buying and selling, you will be notified as part of your online declaration, as to which these are and to which sites they relate.
It is then up to you to declare the income in the correct boxes if you agree it is taxable.
Tax at source
Your declaration this year will recap all the tax-at-source levies that were made in 2020, so you can check these and modify the amounts if (in rare cases) you do not consider
them correct. Note that it will also indicate instalments levied on property or self-employment income, for example, but these cannot be modified.
Declaring capital gains
Please note if declaring on paper that boxes 3VG and 3VH for declaring total capital gains and capital losses have moved from the main 2042 form to 2042C, page 2.
Gifts to charities
If declaring on paper, note that boxes 7UD and 7UF for declaring gifts to charities in France have moved to the main 2042 form, page 4, whereas last year they were on the 2042 RICI.
Micro-entrepreneurs who opted for the versement libératoire system for income tax – social charges relief
There are new boxes on the 2042C-PRO or equivalent online section of the main declaration. These are for inserting those amounts of turnover in March to May-June 2020 that are exempt from social charges. This applies where you benefited from this social charge exemption, but is to ensure you nonetheless pay income tax on the relevant income.
Income from sales: Total annual income is inserted box 5TA – then insert the part that is social charges exempt in new box 5TJ.
Income from services inserted box 5TB – use new box 5TK.
Liberal profession income inserted box 5TE – use new box 5TL.
Other Covid-19 relief for small businesses
Financial aid from the Fonds de Solidarité, the Conseil de la protection sociale des travailleurs indépendants or the Caisse nationale d’assurance vieillesse des professions libérales is exempt from income tax.
Small businesses – social charge declaration
The Déclaration sociale des indépendants that was previously completed by those on the régime réel at net entreprises.fris abolished. The social charges will now be calculated based only on the main income declaration.
The tax office’s mobile phone app has this year been improved, including the addition of an English-language translation.
Its functions include being able to consult previous tax documents, pay tax and update your personal details. You can also declare via the app if you come under the ‘automatic declaration’ category, ie. you have nothing to add to the information known to the tax office already.
UK SIPP pensions
With UK SIPPs – self-invested personal pensions – you declare any sum you draw as pension income. There is no need to detail what happens within it, such as dividends being received, a tax expert working with the English-speaking community in France told The Connexion.
Overseas credit cards
Several readers have asked whether overseas credit cards must be declared as an account on the 3916 form or online section.
This is a grey area, with some tax experts stating it is generally unnecessary unless in rare cases such as if you have a salary or pension paid to it and so run a positive balance on it as a result.
However we checked the point twice with advisors on the general French tax helpline and they said all overseas credit cards are considered accounts to be declared.
In you do declare one and find you cannot complete every line, leave blank those which are not appropriate to your credit card.
If in doubt we suggest, as in other cases where you are unsure of a specific point in your personal declaration, you send a query in French to your tax office via your personal space at impots.gouv.fr or making a mention expresse in your online declaration to say you, for example, you have a UK credit card but you have not included it on your 3016 because it never holds a positive balance (le solde n’est jamais créditeur).
Obtaining paper forms - be sure to have the right year
One first-time declarer asked The Connexion if it is acceptable to use a version of the foreign income form dated 2019. The answer is no, always use this year’s version of key forms such as this one. Some less common forms may not be updated annually in which case use the most recent form available.
Search with its name, eg. 2047 for the foreign income form, in the search box at the top of the tax website and then check the resulting links under Formulaires on the right-hand side. If you scroll down you should see one that says Millésime 2021 (literally ‘2021 vintage’). Note however that the actual form will have Déclaration revenus 2020 on it as it is income from 2020 that needs to be declared this spring.
3916 form - foreign accounts
This form and its equivalent online section now has a section specifically for declaring details of foreign life assurance schemes and similar investments. It has also been combined with the 3916-bis form (introduced in 2020) for declaring cryptocurrency accounts held overseas.
When completing this section online, this year you will be asked specifically which of the three kinds of overseas accounts you have, and how many of each; the system will then open the relevant sections to be completed.
If declaring on paper, you should complete a copy of the form for each relevant account you hold and cross in section 2 as to which kind of account is concerned.
With regard to sections for bank accounts, the information to be provided is the same as in the previous version of the form, including personal details and details of the account, account number, which bank it is held at etc.
One difference is that under the ‘characteristics of the account’ section, you are invited to select boxes marked compte courant (currant account), compte d’épargne (savings account) or autres (others). In the previous version you were just asked to freely write in the nature of the account.
There is also a new section in which you are asked to say if the use of the account is personal, professional or mixed, and in the case of it being professional you are asked to provide the details of the business concerned.
With regard to declaring life assurance policies and similar overseas investment schemes, the following lines are to be completed where relevant.
Désignation du contrat ou placement – Give the product name of the contract, for example Assurance vie ‘Evolution’.
Référence du contrat ou placement – Give the policy number.
Caractéristiques du contrat:
Contrat de capitalisation – A ‘capitalisation contract’ is a kind of investment policy similar to an assurance vie but lacking an actual ‘life insurance’ element.
Autre placement de même nature (contrat d’assurance) – Cross if declaring an assurance policy.
Autre placement de même nature – Cross if declaring another overseas investment scheme that does not fall under either of the above.
Désignation de l’organisme d’assurance et assimilé, et, le cas échéant, de la succursale qui accorde la couverture – Insert name of the actual assurance provider, ie. not the name of a broker who you arranged the policy with. Succursale refers to a subsidiary branch of a large company. If the latter applies, give its name as well as the name of the main firm.
You are then asked to insert the address of the body above, including country.
Nature des risques garantis – This translates as ‘nature of the risks covered’. Some financial advisors suggest leaving this blank if this is unclear, or, for a life assurance policy you could insert ‘vie’ if leaving it blank is not accepted.
Moment à partir duquel le risque est garanti (sauf disposition contraire du contrat, il s’agit de la date de souscription) – Literally, 'date from which the risk is covered'. In most cases you should insert the date when the policy began.
Durée de la garantie – Length of the cover, for example viager (for lifetime) for a life assurance policy.
Date d’effet des avenants intervenus en cours d’année – Date at which any modifications to the policy were made during the year. This does not refer to eg. switches of investments within the policy, but eg. if you changed a beneficiary clause.
Date d’effet et montant de chaque opération de dénouement partiel intervenue en cours d’année – Insert date/s of any partial withdrawals during the year and the amount of these.
The following line is for the same information if you withdrew all of the money from the policy.
Montant total des operations de versements des primes effectuées en cours d’année – Insert total amount of money paid into the policy during the year.
Le cas échéant, valeur de rachat ou montant du capital garanti, y compris sous forme de rente, au 1er janvier de l’année concernée par la présente déclaration – Insert the value of the policy on January 1, 2020.