Money and tax changes in France - 2019
A new at-source tax system starts for all on January 1, 2019. Online/paper declarations will still however need to be completed every spring.
French salaries and pensions will be paid with tax deducted, based on a rate established from your last declaration and noted on your last avis d’imposition (or based on the level of the income alone, if you requested this).
Possible refunds or extra tax will apply next year once you have declared your actual 2019 income in May/June 2020.
If you have regular rental income or foreign income, instalments will be deducted from your French bank account either monthly or quarterly, based on previous declarations.
If you previously benefited from certain tax credits or reductions (but not the CITE for eco-friendly work in the home) you should receive a 60% advance into your bank account from January 15, based on the declaration made for 2017 income in May/June 2018.
The lowering of the taxe d’habitation for 80% of households continues this year with 65% off 2019’s bill for those eligible. Full exemption will follow in 2020. In some cases the promised 30% off in 2018 proved less significant than hoped for due to rises in the rate applied by mairies and intercommunal bodies.
Income tax bands for 2019 have risen by 1.6% linked to inflation. They are therefore:
- 0 - €9,964 = tax-free
- €9,964 - €27,519 = 14%
- €27,519 - €73,779 = 30%
- €73,779 - €156,244 = 41%
- €156,244 and above = 45%
It was announced that banks agreed with President Macron not to raise fees in 2019. However commentators said in reality it will make no difference as hardly any rises were planned.
Around 3.5million pensioners with net earnings of less than €2,000/month will go back to the 2017 rate of CSG social charge on pensions (6.6% instead of 8.3%), it was announced in response to the gilets jaunes protests.
It comes on top of plans in the 2019 Finance Law to allow an extra 300,000 retirees on moderate pensions to benefit from the means-tested reduced rate of CSG charge on their pensions (3.8% instead of 8.3%). In 2019 the higher rate will only apply to households which have been over the threshold for two consecutive years, meaning those that went into the higher rate for the first time in 2018 will not be included. Residents who do not receive a French pension but receive a state pension from another EU state do not pay social charges on pension income.
The AAH benefit for disabled adults and the Aspa pension top-up are both being increased by more than the usual amount.
AAH will be boosted by €40/month for its 1.1 million recipients. Aspa, claimed by 1.3million people, increases by €35/month as of January.
Around 20 “little taxes” which do not bring in much money for the state are being abolished. They include tax levies on flour, semolina and wheat gruel; on the addition of sugar to the grape harvest; and a “contribution on hole punching and precious metal tests”.
Also on the list is the annual tax on mobile residences, pay-able by those living permanently in a caravan or mobile home.
The TV licence fee stays at €139.
All foreign bank accounts must be declared as part of your income tax declaration this year, even if they have not been used.
Online platforms such as Airbnb are now meant to notify the tax authorities of your annual earnings if they exceed €3,000.
This will not exempt you from also declaring the income, whatever the amount, with exceptions such as occasionally selling your own belongings or carsharing if expenses alone are involved.
