How to file a French tax return as an expat
Once you establish residency in France, you are liable to pay taxes in France on your income world-wide. Here's a guide to filing a French tax return as an expat.
The déclaration des revenus is the first step for paying your taxes in France. As an expat living in France, you will need to know the French tax regulations and learn how to file your French tax return, or déclaration des revenus. It will also help to know which expenses can be deducted when filing your French tax return, such as childcare expenses, energy efficient technologies, or hiring domestic help.
Are you liable to pay French taxes?
Under French law, you are a resident in France for tax purposes if you meet any one of the following four conditions:
- Your permanent home (habitual home for you and/or your family) is in France.
- You spend most of your time in France (at least 183 days during a calendar year, or even less if you spend more time in France than in any other country).
- Your professional activity is in France.
- The centre of your economic or financial interest is in France.
How are taxes in Frace calculated ?
French taxes are calculated on a calendar year basis. In order to comply with your French income tax reporting obligation, you must complete Form 2042 (the recapitulative form) and perhaps other forms depending on the source and type of income and expenses for the year.
When are the fiing deadlines ?
Please note that the income tax declaration must be completed by the due date, which is generally sometime in May of the following year. The actual date can vary from one year to another. If you are not a first time filer, you also have the option to file online which gives you additional time to file.
It is very important to respect the filing deadlines. There will be a penalty assessed at 10 percent (majoration) for late filing.
For those who have already filed a French tax declaration and are already in the system, they should expect to receive a pre-printed (pré-remplie) tax form, with certain information filled in the form. This information will include salary amounts, bank interest, dividends etc. If the information provided in the pre-printed form is incorrect, you should cross out the erroneous figures and write in the correct figures. You will not receive a preprinted form if you opt for online filing.
For those who will require a form and have not received a pre-printed form, you can obtain forms at your local tax office (centre des impôts) or online by referring to the following website: www.impots.gouv.fr.
French tax return: Declaring your income and deductions
As a French tax resident, you are taxed on your worldwide income. This will include salary, pensions, interest and dividends, rental and any other income.
The most common deductions for 2013 income are:
- outside-the-home childcare for children under six (50 percent of cost up to EUR 2,300 per child);
- having school-age dependents (EUR 61 per child for collège, EUR 153 for lycée, or EUR 183 for university);
- installation of energy-saving technologies in the home (a chaudière à condensation or chaudière à basse temperature);
- employing a domestic worker (frais d'emploi d'un salarié à domicile) – you may deduct 50 percent of the salary up to a total of EUR 12,000;
- giving money to a charitable organisation will provide for a deduction of either 75 percent or 66 percent of amount donated subject to further limitations depending on the charity;
- child support costs as a result of a divorce judgement;
- union fees.
Marriage / pacsé
If you were married or pacsé in 2014 and live together, then you have the option of filing a joint return for the entire year or a separate return for the year, whichever gives you the best result.
In the year of divorce, each spouse needs to file a separate tax return as you are considered divorced for the entire year.
If your spouse died in 2013, then it's more complicated and you probably need the services of a notaire or accountant. But the overall rule is that you must fill out a déclaration for yourself from the date of death until 31 December; you have six months from the date of death to correctly fill out a joint déclaration from 1 January until the date of death.
If you have minor children living at home but working (up to age 25), their income is added to yours as long as you declare them as part of your tax household. (See below for a definition of foyer fiscal).
Paying your French taxes
Please note that you do not pay any amount with your declaration. Once this is received by the French tax authorities, they will calculate your tax and send you a bill (avis d'imposition), usually around mid- to late-August for the amount of taxes due. If you are a first time filer, you may get your tax bill as late as November or December of the year you filed.
Once you are in the system, the French tax authorities will use the previous year's income as a basis to calculate the following year's taxes. For example, if 2013 was the first year you filed you will be paying towards your 2014 French tax liability on the basis of your 2013 income.
The standard payment cycle is three installments but you can also put in place a monthly tax withholding arrangement either through an express request at your local tax office or by going online. For more information, read A guide to taxation in France, or you can refer to the following link: www.impots.gouv.fr.
Useful French tax terms
- Abattement: standard deduction.
- Avis de non-imposition: certificate of non-taxable income (you will receive this if your total income is under the taxable income threshold).
- Barème fiscal: tax-rate table (sets out the amount of tax for a given amount of income).
- Un contribuable: a taxpayer.
- Un credit d'impôts: a tax credit or a reduction in tax generated by one of many tax saving schemes.
- Un expert comptable: accountant.
- Foyer fiscal: tax household (the household is calculated in portions, parts. First and second children counts as ½ part; a third child counts as a full part. So a married couple with one child is a household of 2.5 parts; a married couple with three children has four parts. Even married children and grandchildren can be added to your tax household under specific conditions).
- Impôts sur le revenu: income taxes (as opposed to property taxes, sales taxes, etc).
- Impôt de solidarité sur la fortune: wealth tax (this applies to anyone whose net wealth is worth more EUR 1.3m.
- Prélèvements obligatoires: all social charges and sometimes this can include income taxes taken at source
- TVA (taxe sur la valeur ajoutée): value-added tax or sales tax (it currently stands at 20 percent on all goods and services except those specifically exempted).
- Revenu à déclarer: gross income.
- Revenu imposable: taxable income after all deductions and credits are calculated.
- Revenu foncier: rental income.
- Service-Public is the website of the French civil service and has detailed information on all aspects of personal and business taxation and social charges.
- www.impots.gouv.fr is the website of the French Ministry of Economy and Finance, the body that collects income tax.
MG Partners Paris / Expatica
The article which was first published on May 2007 has been updated by MG Partners Paris.
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Updated 2007; 2010; 2014.