Why your French tax rate may have changed

You may not have noticed it yet – but if you are a French income tax payer, your tax rate may have changed yesterday.

2 September 2020
By Liv Rowland

This could have an effect on, for example, how much you receive from a salaried French job at the end of this month, or from a French pension, as both of these have tax deducted at source.

It could also affect the amount of the instalments that are deducted from your bank account (usually on the 15th of the month, at monthly or three-monthly intervals) by the tax office if you have certain known regular incomes that the French authorities cannot tax directly at source, such as salaries or pensions from overseas or rental revenues (see this previous article for more about these).

The change is because September 1 is the date when the tax authorities uprate your ‘tax at source’ rate, based on the income declaration you made in May-June this year. The rate has now been fixed until September next year.

However, if your real overall income this year has in fact dropped compared to what you declared in the spring, you may wish to alert the tax office to this so the rate is modified.

This may benefit your cashflow and also avoid you having to wait a year to be refunded for any excess tax you may pay. Alternatively if your income has risen significantly you can also indicate this also.

To report this change go into your personal space on the tax website at impots.gouv.fr and see the section Gérer mon prélèvement à la source.

Click on Actualiser suite d’une hausse ou une baissse de revenus and complete the information requested as to your current income levels this year. The system will make a comparison with the income declared for 2019.

Normally a change will only be granted if the modification is likely to result in an annual tax that is 10%+ (and at least €200) less than what would have been payable otherwise.

The new rate will be transferred to the relevant bodies (employer, retirement caisse etc), and will be applied in no more than two months’ time.

For more about France’s tax at source system, see our French Income Tax 2020 Helpguide

This Connexion helpguide includes key information on how the French tax system works, including prélèvement à la source (tax at source), which came into force last year, who needs to declare income to France, including both residents and non-residents, and how to declare common types of income. Find out more here.

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