French income declarations open on Thursday (April 13) and this year there are some changes to be aware of before completing your tax returns.
To recap: everyone resident in France or who has relevant France-sourced income, most commonly from renting out a second home, must make a declaration.
We summarise new points this year.
The changes have been confirmed in the latest online ‘brochure’ or tax guide, which is published each year by the main tax body the Direction générale des finances publiques (DGFiP).
What is the deadline for completing your income declaration?
The window to declare your income for 2022 opens on April 13 and closes on May 25, June 1 or June 8, depending on where you live.
Income tax bands change
The income tax bands have been increased by 5.4%, which means a higher threshold for moving to the next bracket.
For example, last year a salary of €10,300 would have placed part of your earnings in the 11% band but this year, you would be in the 0% tax band.
The new bands are as follows:
- Up to €10,777: 0%
- From €10,778 to €27,478: 11%
- From €27,479 to €78,570: 30%
- From €78,571 to €168,994: 41%
- More than €168,994: 45%
New requirement for all homeowners
All property owners now have until June 30, 2023, to make a one-off declaration of their property/ies’ occupancy. You can do this via the ‘Biens immobiliers’ space on the impots.gouv.fr website.
This is mandatory for all property owners, whether main or second homes. The information is needed, it is claimed, to check and determine who does or does not need to still pay taxe d'habitation. Owners of second homes are still required to pay this. It is not due on main homes.
Read more: All owners of French properties must fill in this new tax-site form
Read more: What is France’s empty homes tax and why more people will be paying it
Read more: How to fill in new French property form and why it is causing problems
Kilometrage allowance re-evaluated
The kilometrage for people using their vehicles for work has also been re-evaluated by 5.4%.
Two million households in France use their vehicles for work and can deduct travel expenses from their taxable income, in place of the standard 10% work-related expenses allowance.
Tax credit increase for childcare
Parents eligible for the childcare tax credit, for childcare outside the home (e.g. crèche, daycare centre, approved childminder) can this year benefit from an extra €600 reimbursement for each child under six years old.
The maximum amount eligible for this tax credit is now €3,500, up from €2,300 before.
The tax credit is equal to 50% of expenses incurred during the year. Families will therefore be able to benefit from financial assistance of up to €1,750 per child. This is €600 more per year than last year.
In the case of alternating custody, the tax advantage will be a maximum of €875.
New rules for at-home help or jobs
Those who benefit from tax credits for an at-home employee (or odd jobs) will now have to specify what was done/offered.
This applies to all forms of home help, including childcare, tutoring, home maintenance, small DIY and gardening, etc.
End of the 30% tax credit for a first press subscription
The ability to have tax credits for a first subscription to a political or general information newspaper or informational magazine, in paper or digital form, ended on December 31, 2022. However it still applies to payments made in 2022, for a minimum of 12 months.
Social charge exemption on foreign pension income
Remember, there are now boxes for stating you are not a burden on the French health system in order to qualify for a social charge exemption on foreign pensions. They are found at boxes 8RP/8RQ (on paper this is on the 2042C form).
New information on the tax form
Taxpayers will now be able to see the marginal tax rate and the average tax rate on their tax returns.
The marginal tax rate is the rate at which someone is taxed on their income (e.g. the bands from 0%, 11%, 30%, 41% or 45%).
The average tax rate, on the other hand, shows the proportion of tax you pay in relation to your total income.
No more TV licence
The TV licence (redevance télé) fee has been scrapped for 2022.
Taxpayers no longer have to specify in their tax return whether or not they own a television set. This applies to main and second homes.
Tips paid in 2022 and 2023 are exempt from income tax and social security contributions. This only applies to employees who receive a maximum income of up to 1.6 x the minimum wage (Smic).
Overtime limit increased
The cap on tax-exempt overtime earnings has been raised from €5,000 to €7,500 for hours worked in 2022.
Deductible carpooling costs
Those who want to list their actual carpooling work expenses, instead of claiming the 10% vehicle deduction, will now be able to add these to their expenses for journeys between their home and their place of work.
These are now considered ‘deductible professional expenses’.
Veterans’ tax change
Widows and widowers of French veterans over 74 years of age, whose deceased spouse was a holder of the veteran's card at the time of his or her death, are entitled to an additional ‘half-share’ of the family tax allowance.
Last year, only widows and widowers whose spouse died before the age of 74 and was a holder of the veteran's pension during his or her lifetime were able to benefit from this extension.
The Connexion’s new Income Tax in France 2023 (for 2022 income) Helpguide is now available as a digital, PDF version. It helps with declarable income such as pensions, rent, ISAs, shares, savings and interest, Airbnb income, and self-employment, with an overview of the various French forms. You can buy it here.
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