Current French Tax Rates
Income tax
2022 Income Tax Barème
|
Income Bands (€) - Applicable to 2022 taxable income
|
%
|
|
Up to 10,777
|
0
|
|
Between 10,777 and 27,478
|
11
|
|
Between 27,478 and 78,570
|
30
|
|
Between 78,570 and 168,994
|
41
|
|
In excess of 168,994
|
45
|
Barème applicable to 2021 taxable income:
|
Income Bands (€)
|
%
|
|
Up to 10,225
|
0
|
|
Between 10,225 and 26,070
|
11
|
|
Between 26,070 and 74,545
|
30
|
|
Between 74,545 and 160,336
|
41
|
|
In excess of 160,336
|
45
|
Extra Income Tax on High Income
An extra income tax charge applies to households with a net worldwide taxable income (revenu fiscal de référence as stated on their tax assessment) in excess of:
- €250,000 for single individuals. The levy is 3% up to €500,000 of taxable income, and 4% thereafter.
- €500,000 for couples. The extra levy is set as 3% between €500,001 and €1m and 4% in excess of €1m.
Pay As You Go
From 1 January 2019, French income tax is partially levied on a “pay as you” go basis & taxation at source of investment income. The monthly levies are determined based on the previous year’s income assessment. Taxpayers whose taxable income is below €26,065 may not be subject to the pay as you go levy for the 01.01.2023 – 31.08.2023 period.
Taxation at source of investment income
Households with a worldwide taxable income above certain limits must ensure that they apply a payment on account in respect of any non-French dividends, directors’ fees or interest they receive. This requires the filing of forms 2778-DIV and/or 2778-Int and payment of the levy before the 15th of the month following the receipt of the income. The limits are currently fixed at €25,000 for single taxpayers and €50,000 in respect of interest and €50,000 (single) or €75,000 (couple) for dividends and directors’ fees.
2023 Wealth Tax on Real Estate
The IFI “Impôt sur la Fortune Immobilière” applies to French households with net realty in excess of €1,300,000, to include real estate and shares in real estate holding entities and certain property financial investments (SICAV, SCPI, FCP etc.). Newcomers to France may be exempt from wealth tax on their non-French real property in the first five years of their residence.
The IFI also applies to non-residents but only in respect of their French assets (including shares and rights in French property holding entities). The penalty for late filing is 10% which may cumulate with the 10% penalty for late payment.
|
Taxable Wealth (€) as at 1 January
2023
|
%
|
|
Up to 800,000
|
0.00
|
|
Between 800,000 and 1,300,000
|
0.50
|
|
Between 1,300,000 and 2,570,000
|
0.70
|
|
Between 2,570,000 and 5,000,000
|
1.00
|
|
Between 5,000,000 and 10,000,000
|
1.25
|
|
Above 10,000,000
|
1.50
|
2023 Social Contributions
Contribution Sociale Généralisée (CSG), Contribution au Remboursement de la Dette Sociale (CRDS), Prélèvement Social (PS) and Prélèvement de solidarité (PSol).
General rates applicable to 2023:
|
Base
|
|
CSG
%
|
CRDS
%
|
PSol
%
|
Casa
%
|
Total
%
|
Deductible
CSG %
|
|
Investment, rental income property & investment gains
|
|
9.20
|
0.50
|
7.50
|
0.00
|
17.2
|
6.8
|
|
Salaries and non-salaried income
|
|
9.20
|
0.50
|
0.00
|
0.00
|
9.7
|
6.8
|
|
Pensions including pre-retirement pensions
|
|
8.30
|
0.50
|
0.00
|
0.30
|
9.1
|
5.9
|
Notes:
1. The social charges apply to all sources of income and gains received by individuals affiliated to the French social security regime (including the PUMA).
2. Foreign pensions, salaries and investment income & gains are not liable to the CSG and CRDS if the French resident taxpayer is registered for health cover in another EEA State - under form S1 for instance.This exemption also applies to expats living in France and covered for health purposes under the United Kingdom's exit agreements from the European Union signed on 12 November 2019 and 30 December 2020.
3. Non-French residents in receipt of French income or gains are exempt from the CSG and CRDS if affiliated to a social security regime in another EEA State or in the UK, but they are liable to the 7.5% PSol.
4. Pensions, disability allowances and unemployment benefits may be eligible to an exemption or a lower CSG charge depending on the household's total taxable income in the previous years. If so, the deductible CSG is reduced accordingly.
5. The top rate of CSG is 6.2% for unemployment benefits.
2023 Property Capital Gains Tax "CGT"
CGT and social contribution rates
|
Individuals
|
CGT
%
|
PSOL
%
|
CSG & CRDS
%
|
Total
%
|
|
Affiliated to the French sécurité sociale or those who are not affiliated to an EEA/Swiss/UK NI regime
|
19
|
7.5
|
9.7
|
36.2
|
|
Affiliated to an EEA/Swiss/UK NI regime excluding the French social security regime
|
19
|
7.5
|
0
|
26.5
|
Residents outside the EEA must appoint a fiscal representative to deal with their French CGT obligations if their share of the French asset's disposal value exceeds €150,000.
Commercial company & trusts are subject to corporation tax rules and rates on their property gain.
Extra charge on gains in excess of €50,000
|
Net taxable gains (€)
|
%
|
|
Up to 50,000
|
0
|
|
Between 50,000 and 100,000
|
2
|
|
Between 100,000 and 150,000
|
3
|
|
Between 150,000 and 200,000
|
4
|
|
Between 200,000 and 250,000
|
5
|
|
In excess of 250,000
|
6
|
Taper relief reducing the gross taxable gain
CGT and Social Charges Taper Relief
| Years of Ownership |
CGT (19%) |
Social Surcharges (17.2%/7.5%) |
Years of Ownership |
CGT (19%) |
Social Surcharges (17.2%/ 7.5%)
|
| |
Taper Relief |
Taper Relief |
|
Taper Relief |
Taper Relief |
| Up to 6 Years |
0% |
0% |
Between 18 & 19 Years |
78% |
21.45% |
|
Between 6 & 7 Years
|
6% |
1.65% |
Between 19 & 20 Years |
84% |
23.10% |
| Between 7 & 8 Years |
12% |
3.30% |
Between 20 & 21 Years |
90% |
24.75% |
| Between 8 & 9 Years |
18% |
4.95% |
Between 21 & 22 Years |
96% |
26.40% |
| Between 9 & 10 Years |
24% |
6.60% |
Between 22 & 23 Years |
Exemption |
28% |
| Between 10 & 11 Years |
30% |
8.25% |
Between 23 & 24 Years |
Exemption |
37% |
| Between 11 & 12 Years |
36% |
9.90% |
Between 24 & 25 Years |
Exemption |
46% |
| Between 12 & 13 Years |
42% |
11.55% |
Between 25 & 26 Years |
Exemption |
55% |
| Between 13 & 14 Years |
48% |
13.20% |
Between 26 & 27 Years |
Exemption |
64% |
| Between 14 & 15 Years |
54% |
14.85% |
Between 27 & 28 Years |
Exemption |
73% |
| Between 15 & 16 Years |
60% |
16.50% |
Between 28 & 29 Years |
Excemption |
82% |
| Between 16 & 17 Years |
66% |
18.15% |
Between 29 & 30 Years |
Exemption |
91% |
|
Between 17 & 18 Years
|
72% |
19.80% |
Over 30 Years |
Exemption |
Exemption |
PUMA General Health Cover
The Protection Universelle Maladie (PUMA) was introduced in 2016 to allow a simpler and individualised access to basic French healthcare for all French residents.
The Puma health cover is compulsory for
- anyone who resides habitually in France, and
- who is not covered under an EEA NI regime (which may include any British citizens living in France post-Brexit), and
- whose total 2022 annual professional earnings are below €8,227 (limited to €20% of the "PASS" - see below).The 2023 limit should be set at €8,798.
The contributions payable into the PUMA scheme, through the URSSAF, are calculated at a rate of 6.5% of the net capital and investment income & gains declared in the previous year. This total assessable base is capped at 8 PASS i.e. €308,520 (2022) and €351,936 (2023). There is also an abatement of 50% PASS i.e. €20,568 for 2022 and €21,996 for 2023. The maximum contribution to the PUMA is therefore €20,054 per person (€21,446 for 2023).
“PASS”: Reference index known as « Plafond Annuel de la Sécurité Sociale » fixed at €41,136 for 2022 and €43,992 for 2023 and updated every year.
Gifts Tax and Estate Duties - 2023 Gift and Legacies
- Legacies between spouses or members of a PACS agreement are exempt from French inheritance tax. The following rates apply however to lifetime gifts, after a tax-free allowance of €80,724.
|
FOR GIFTS MADE IN 2023
|
|
Gift Value (€)
|
%
|
|
Up to 8,072
|
5.00
|
|
Between 8,072 and 15,932
|
10.00
|
|
Between 15,932 and 31,865
|
15.00
|
|
Between 31,865 and 552,324
|
20.00
|
|
Between 552,324 and 902,838
|
30.00
|
|
Between 902,838 and 1,805,677
|
40.00
|
|
In excess of 1,805,677
|
45.00
|
- Legacies or lifetime gifts between parents and children are taxed on the following sliding scale after a tax-free allowance of €100,000.
|
2023 GIFTS & INHERITANCE TAX
|
|
Estate Value (€)
|
%
|
|
Up to 8,072
|
5.00
|
|
Between 8,072 and 12,109
|
10.00
|
|
Between 12,109 and 15,932
|
15.00
|
|
Between 15,932 and 552,324
|
20.00
|
|
Between 552,324 and 902,838
|
30.00
|
|
Between 902,838 and 1,805,677
|
40.00
|
|
In excess of 1,805,677
|
45.00
|
- Legacies or gifts between siblings benefit from a €15,932 tax free abatement and the excess gives rise to a charge calculated as follows:
|
2023 GIFTS & INHERITANCE TAX
|
|
Estate Value (€)
|
%
|
|
Less than 24,430
|
35.00
|
|
24,430 plus
|
45.00
|
- The rate of inheritance tax for legacies and gifts to nephews and nieces is 55% after a tax-free allowance of €7,967 each. Where nephews and nieces inherit in lieu of their parent, the rates for transfers between siblings apply but the €15,932 tax-free allowance is shared.
- Transfers of assets to other relations up to the fourth degree are taxed at 55% and all other transfers (to remote relatives or unrelated individuals) are taxed at 60% after a small tax-free allowance of €1,594.
- The gift tax allowance for a lifetime gifts from a grandparent to a grandchild is €31,865. It is fixed at €5,310 for lifetime gifts made by a great-grandparent.
For French tax advice or assistance with the preparation of your French tax returns (for non-residents or residents of France) Contact us or call Virginie Deflassieux or Catherine Le Pelley on +44 1481724 561.