What income is affected?

Income from French employment and from French retirement pensions are the main sources of income taxed by prélèvement à la source (PAS) in a literal sense ie. The tax is taken off before you receive the money.

It is the employer or pension body that deducts the tax and it is then paid over to the Trésor Public, the state service that collects tax. Unemployment benefit is also dealt with in this way.

Tax on other income is paid on an ‘on account’ basis based on your previous declaration and then checked. This means balancing payments or extra demands may be required.

This is the case for French property income and the earnings of self-employed workers (apart from those who opted to make fixed-rate libératoire income tax payments on a regular basis) and regular pension alimentaire payments such as support payments received from an ex-spouse.

For these, as well as for regular recurring taxable income from abroad such as foreign pensions taxable in France, regular estimated direct debit instalments are taken from your bank account, based on your last income tax declaration. 

This year these instalments are initially calculated based on your 2025 declaration relating to 2024 income. They are then reassessed as of September 2026 based on your declaration of 2025 income. 

Make sure your bank details are up to date on your declaration as it may be necessary to make reimbursements or to take an extra instalment. You can check or change your registered bank account at any time via your personal space on impots.gouv.fr.

What income is not affected?

Income types which fall outside the PAS system include that from shares and investments, capital gains and certain other ‘oneoff ’ incomes.

Income from French shares and investments is subject to a 31.4% ‘flat tax’, other than for declarants who opt for the ordinary income tax bands to be applied instead.

Assurance vie and French shares savings plans (plan d’épargne en actions) benefit from specific tax rules. Ordinary capital gains on shares (classed as ‘one-off income’) are declared in the year following the gain and are subject to the 'flat tax' at 31.4% (unless you instead take up the option for the normal income tax bands).

French property capital gains are taxed immediately on a sale and the notaire collects the amount due. The percentage amount varies depending on how long you have owned the property.