Income tax in France: features

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

What is the income tax in France? This question cannot be answered right away, if only because the taxation system in this country is confusing. But we will still cover the topic, having previously explained what other taxes for individuals exist in the country.

General information

Income tax in France is considered one of the highest in the world, even though the country is a member of the European Union and the European Economic Community. Why are taxes in the country considered very high? This is mainly due to the fact that France occupies an exceptional role in both the economic and political spheres among European states.

The country has developed a two-system taxation. What does it mean? We are talking about the fact that taxes are levied both at the local and at the national level. It should be noted that this structure is relevant for many European countries.

Main taxes are divided into three categories:

1. Income tax in France. And it's abouttax for legal entities and individuals.
2. On the capital and property of the subject. This includes vehicle or property tax.
3. Consumer taxes. A prime example would be VAT or excises.

What should individuals pay?

You already know that the income tax in France is very high, but often the amount is not all right. This creates a lot of misunderstandings and resentment. Meanwhile, the high amount of taxes is explained by the fact that the population of the country has a large income, although for a Russian citizen the figure will really seem shocking.

Recently, France has made some changes in the amount of income tax, thereby causing a wave of discontent among the population with increased rates. Basically, the changes affected very rich citizens, which ordinary people only supported. But there were those of the rich who defiantly renounced French citizenship due to the fact that the amount of tax became very, very large.

What is the income tax in France now? Understanding further.

How do I know the tax amount?

In order for a person to find out how much he owes the state, it is necessary to determine which group of taxpayers he belongs to. The country has its own rates for each category.

To the question: "What is the income tax in France?" It is impossible to answer specifically, because the country has a progressive scale, thanks to which different segments of the population pay different amounts. Such a system is considered as fair as possible and is approved by citizens. By the way, the range can reach both 0% and56%.

When comparing the French tax and the same fees in other countries, such as the United States, you can see that France is ahead of other countries in terms of payments.

It is important when calculating income tax in France as a percentage and marital status. How does it affect? Yes, it’s very simple: for single people and for family citizens, the amount of tax will be different. Why is this happening? For example, a citizen is divorced, but he has a minor child. This, of course, will affect the amount of tax. The same applies to parents with many children and some other circumstances.

It is important that a person, before determining the calculation base for personal income tax, correctly deducts all expenses that are not subject to taxation. These include the education of children, medical care, the cost of providing for family members who do not have a source of income, and so on. If everything is done correctly, then the income tax in France as a percentage will be much less.

In addition, the country provides certain benefits to certain categories of citizens. Among them are military personnel, active patrons and other people. You can’t just go to the tax office and demand benefits or deductions without presenting any documents. Each relaxation must be documented.

In addition to income tax, in France individuals are still charged the amount for social and he alth insurance. This applies only to employed citizens, because the employer makes deductions from the employee's salary.

News

It is important to understand that for emigrants there is an indulgence in terms of payments. This applies to those who are not yet a resident of the country and are in the territory of the state for less than six months. The small size allows you to pay all fees without problems during the adaptation period.

In France, changes are constantly being made to the Tax Code due to the fact that the country's parliament annually approves a budget that directly relates to the issue of taxation.

Let's look at the features of the French fiscal system.

Features of French taxation

First of all, it is worth noting that all taxes have a social focus, while taking into account the interest of the provinces. But the dominant role is still occupied by income tax in France from individuals and legal entities.

Since the country has a high standard of living, the budget is formed mostly through taxes. The French tax office monitors the timely payment.

What taxes are there in the country

In addition to personal income tax, other taxes are levied in France. A person begins to pay them from reaching the age of majority.

The tax is calculated according to the data that the citizen submits in the declaration. By the way, in Russia taxes are calculated in approximately the same way.

Let's take a look at the most popular taxes in the French Republic.

Income and income tax

It so happened that the income tax in this country is considered the main one. He's obligated to payall citizens of the country, regardless of income. Even non-residents pay it with the only caveat that only the amount received as income in the country is subject to payments. As for residents, they pay income tax on all the money they receive, no matter where they come from.

It is important to understand that personal income tax in France depends on the amount of income.

The same Russian, after arriving in France within a year, must himself contact the tax office and take a declaration. At the same time, it must be filled out even in a situation where a job has not been found for a year. If there are problems filling out, then a person can contact the tax office, where they will be helped.

Tax deductions

And yet, what is the income tax in France? How much should be given to the state? We have already said above that this question cannot be answered precisely. It all depends on how much a person earns. But even here there are certain nuances, for example, whether tax deductions were calculated correctly.

Individuals are en titled to tax deductions, they allow a good reduction in the amount of tax, but they need to be calculated correctly. So what are we talking about?

1. Housing construction and security costs.
2. Professional expenses. This includes both the cost of purchasing work equipment, and the cost of renting a room for production activities or paying for advanced training courses.
3. He alth insurance costs.
4. Expenses for a disabled family member.
5. Payment for contentchildren in preschools, universities, lyceums and schools.
6. Charity spending.

In order to exempt yourself from tax thanks to these articles, you must provide documents confirming the tax deduction.

What is taxed on

What is the income tax in France now? We still cannot name a clear amount, but we will tell you what it is charged from. For individuals and residents, there are points of income from which fees are taken.

It's about:

1. Renting property. In another way, this is called rent.
2. Commercial income.
3. Profits from non-commercial activities.
4. Pensions and salaries.

Regardless of the amount of income tax in France, not only single people, but also families are required to pay it. Simply put, spouses can file a joint declaration. This is allowed for the reason that French law recognizes husband and wife as a single tax unit. Moreover, the type of such unit or the category to which they belong is taken into account. Only after classification is the percentage of income tax assigned: from a minimum of 5.5% to the maximum.

Bet Size

In France, the income tax rate is made up of two factors: a special coefficient and income. If everything is more or less clear with income, then it is worth talking about the coefficient in more detail.

A special coefficient is assigned depending on the classification:

1. Persons without children andunmarried is assigned a coefficient of 1.
2. People who are legally married are assigned 2.
3. Spouses with one child under the age of majority are assigned 2, 5.
4. For couples with three or more children, the coefficient is calculated from 3. How does it work? If the family has two children, then the coefficient is already equal to 3. For each subsequent child, another 0.5 is added.

It is important to understand that when answering the question of how much income tax in France will be for a particular person, one must take into account the equality of families with one and two parents. At the same time, incomplete families have their own benefits, which also relate to taxes.

Tax calculation

What is the income tax on wages in France? Since we cannot name the exact amount, it will count in the range. So, there is a special table in which the decree is income and tax percentage. This will be charged to the fiscal unit. Let's take a look at it.

1. Tax is not charged if the citizen's income is less than 5,963 euros.
2. When income varies from the minimum amount (listed above) to 11,896 euros, the income tax percentage is 5.5.
3. People receiving up to €26,420 will pay 14%.
4. 30% charged for those who receive up to 70,830 euros.
5. A 40% tax must be paid by people who have an income of at least 150,000 euros.
6. Income up to a million euros is subject to 45%.
7. Well, the real rich, who have more than a million in European currency, pay 48% to the budget.

The final rate is calculated using a certain formula. The total amount of income of the fiscal unit is divided by the assigned coefficient. After that, income tax is calculated at a rate that depends directly on the income of this cell.

So it turns out that the income tax in France is for each person its own amount. By the way, the population of the country is very satisfied with such a taxation system, because everything is done fairly.

If we have looked at the income tax scale in France, then it's time to move on to other taxes that individuals also have to pay.

VAT

In France, VAT is levied on the price at which goods or services are sold. It is noteworthy that the scheme for paying this tax is unstable, which means that it changes very often.

There are categories of individuals in the country who pay tax under a simplified scheme. In addition to individuals, enterprises with an annual turnover of more than 230,000 euros are exempt from paying tax.

Who does not need to pay VAT

If income tax in France is levied on individuals without fail, then some categories of citizens are exempted from paying VAT. Who is this?

1. Teachers of educational institutions. This applies to all levels of education.
2. He alth workers.
3. People who do charity work. It is important that activities are documented.

By the way, gambling establishments and insurance companies do not pay VAT.

Property tax

About the income tax for individuals in France, weeveryone has already told, but this is not the only fee that citizens are required to pay.

Among others, there is a property tax. The real estate market in France is very stable, which attracts foreign buyers and local residents. After buying an apartment or house, the owner is obliged to register it for himself. To do this, you need to visit a notary office.

When buying only built housing, the tax is unlikely to be more than 3%. If the property was put into operation more than five years ago, then the tax rises to 6%. It is worth noting that the age of the house is calculated at the time of purchase.

France has an annual property tax. The amount of this tax is also set for each person individually. To calculate, you need the area of \u200b\u200bthe house and its location.

In France, it is customary to trust the purchase of real estate to a re altor. This happens because only a specialist can properly draw up the paperwork and the owner of the property will be exempt from paying tax for five years.

Inheritance tax

Although 75% of the income tax in France has been abolished, there are still many other taxes that amount to a very impressive amount, such as inheritance tax. We are talking about paying a fee when receiving an inheritance. Taxed, as a rule, an apartment or a house. The rate of such a tax is also unstable, it depends on the value of the property and the degree of relationship between the testator and the heir. Sometimes the tax can reach half the value of the inheritance. In this case, it is easier for the recipient to sell the property in order to pay off the state.

We alth tax

Since France has adopted a fair system of taxation, that is, a tax on we alth. What are we talking about? People who have a fortune of more than 1.3 million euros pay a separate tax. Most often, luxury tax is levied on real estate. For this reason, many owners of large properties try to show that the property is rented or used in professional activities.

About declaration

Every citizen and resident of the country must fill out this document. It will be easier for beginners if a professional shows you how to fill out a declaration for the first time. Such a person will be able not only to draw up the document correctly, but also suggest options for reducing payments.

For all subsequent years, an already completed form will come from the tax office, in which a person will only have to make edits.

The completed declaration is submitted to the tax authority both by mail and in person. Be sure to follow the deadlines for submission.

It is important to understand that the deadlines change almost every year, so you need to keep an eye on this. After the declaration is submitted, the person will receive a letter in which the final tax amount will be indicated.

If for some reason it is not necessary to pay tax, the notification still comes.

Responsibility for non-payment

Although France has a fair taxation system, this does not exempt citizens from paying. Moreover, the punishment for tax evasion in French law is severe.

If a personmade inaccuracies when filling out the declaration or missed the deadline, then a fine of 10% of the tax amount is imposed on him.

In situations where a person deliberately does not pay taxes, he can be seriously punished, including criminal liability.

How to legally reduce tax

No matter how conscious French citizens are, they are still looking for ways to reduce the tax, but, unlike the Russians, they want to do it legally. And such methods actually exist. So, a citizen who has just entered into marriage can pay tax on only half of the amount of income. This rule only works when the wife is a housewife.

Tax payments are reduced if a person has children. Each child who appears in the family reduces the tax by some amount. Also, the cost of studying at a university or school is not taxed.

If children help their parents financially, this amount is also tax-free. But for this rule to work, you must present certain documents.

Important nuances

Russians who go to live in France often worry that they will have to pay taxes in both countries. This kind of concern is in vain, because there is an agreement between the French Republic and our country that allows us to avoid double taxation.

Pension payments

If everything is clear with income tax, then it's time to talk about the pension payments of French citizens.

State social insurance in France is divided intotwo levels:

1. ARRCO. The structure covers all people of working professions. In this situation, 4% of the payroll is paid directly by employers, and 2% is paid by employees from their salaries.
2. AGIRC. In this case, we are talking about all managers and employees in leadership positions. The scheme is the same, only the numbers change: 8% is paid by employers and 4% by employees.

It is important to understand that in France, taxes on payments to state pension funds are considered only part of the payments that people are required to pay from their wages towards a future pension. As a rule, the French pension is formed by additional payments to non-state pension funds. People transfer from 20 to 50% of their earnings to these funds.

By the way, the retirement age in the country is the same - 62.5 years. Upon reaching it, both men and women go on a well-deserved rest.

France is famous for the fact that there are social pensions in the country that are not handed out. So called certain benefits that allow the French to save money. Here are some of them:

1. Residential property tax exemption.
2. Exemption from land tax.
3. Providing a telephone without a monthly fee.
4. Free legal assistance.

French social pensions are financed by social tax on general income, excise taxes on the turnover of certain commercial drinks, some duties.

If this is not enough for social pensions, then the moneytaken from the state budget.

He alth insurance

He alth care is considered another hot topic. Soviet people are used to the fact that money is not taken for medical care. In France, citizens themselves provide quality medical care. Tax payments in this direction are divided into three groups:

1. Regime general d`assurance maladie. This category covers 80% of the country's population.
2. Insurance of various professional groups in certain areas. A striking example is the insurance of civil servants associated with the rural industry, or the self-employed.
3. Insurance for some professional groups. This includes miners, doctors, railroad workers, sailors and more.

How much he alth insurance will pay out depends on how much a person earns, what profession he has, his marital status. The category of danger of the profession also affects the amount of the payment. Moreover, he alth insurance applies to children under twenty years old, spouse, close relatives. The rule only works if these people have a common household with the payer.

Unemployment

The state unemployment insurance system is not based on state guarantees, but on collective agreements between employers and employees. Payments are monitored by several structures:

1. UNEDIC. The structure is responsible for the management and control of the state system of unemployment insurance, as well as forsome financial matters. The organization is also responsible for the rehabilitation and retraining of workers.
2. POLE-EMPLO. The area of responsibility of this structure is the management of insurance accounts and payments on them. The same organization helps to find a job and issues unemployment benefits. By the way, the structure was formed in 2009.