ezan0'5 French income taxrates 2015 and French taxcdatabane accountants FRENCH TAX SUMMARY 2015 Click here for information on the 2014-2015 French income tax returns Back to home page Tax residence Income Tax Company Tax Determination of Personal income tax rates Company tax rates residence Deductions and allowances Consequences of being tax ident In Erant Filing deadlines and tax administration VAT (TVA) Property Related Tax Tax Tax on capital VAT rates in France Capital aains taxon the sale of Wealth tax rates income French property Income tax ‘Taxe Habitation and Taxe Fonciére ‘on capital ‘gains on sale of investments, interestand dividends received Determination of residence “The taxpayer is deemed to be tax resident in France if any one of the following tests is satisfied + They spend 183 days or more each year in France. © Their principal business activity in France. © Their habitual residence is in France. ipunwwatranceaccourtanls corm hl wFrench income taxrates 2015 and French taxcdatabane ‘centre of economic interests" is in France. This would be the case if the taxpayer has their principal investments in France, manages their business from France or the majority of their income is from French sources. Ifthe taxpayer is also resident in another country, their residence is decided in reference to the relevant Double Tax Treaty, if one exists between the two countries. To top Consequences of being tax resident in France As a French tax resident, the taxpayer is liable to: French income tax on their worldwide income and capital gains. Where the taxpayer is also taxed in another country on this income, double tax relief is taken. * French Wealth Tax on their worldwide net assets. * French Inheritance Tax on assets that they bequeath on death or gift during their lifetime. Where the taxpayer is also domiciled in another country for the purposes of this tax, double tax relief is taken. To top Personal income tax rates in France Impét sur le Revenu des Personnes Physique. Tax Year 2014 (income to be declared in 2016). Taxable income (Euros) _|[Tax Rate %| [Up to 9,690 lo 9,690 to 26,764 14.0 26,764 to 71,754 30.0 71,754 to 151,956 [41.0 151,956 + [45.0 Income tax is calculated according to the total income of the household, which is deemed as being equally distributed between each member of the household (called a part). The total income is divided by the number of parts before applying the above rates. The resulting figure Is then multiplied by the number of parts to give the total tax due. Each child counts as half a part. The tax advantage obtained for each child is limited to 1,508 Euros (known as plafonnement), or 3,558 Euros for one-parent families. Totop ipunwwatranceaccourtanls corm hlezan0'5 French income taxrates 2015 and French taxcdatabane Income tax deductions and allowances, Allowances against employment income * General deduction of 10% of salary. The deduction is capped at 12,157 Euros. ‘* Contributions into pension schemes, subject to an upper limit. To top Filing deadlines for French income tax returns ‘The French tax year is equal to the calendar year. Filing dates for the annual income tax retum are as follows: In 2015, the annual fling deadiine for French residents is 31st May, Payments on account are due by the following dates: © First payment: 15th February © Second payment: 15th May * Balance: Payable on issue of final tax assessment, in September. The filing deadlines for non residents are as follows: ‘+ Residents of EU and Mediterranean countries (including North Africa) 30th June ‘+ Residents of other countries 15th July Extensions of up to approximately 3 weeks are automatically granted to taxpayers who file their returns online. There is no Pay As you Eam tax system for employees in France, All employees must therefore submit annual retums and pay the tax due on receipt of the final tax assessment. Totop Wealth Tax in France ISF (Impét de solidarité sur la fortune). Taxation of taxpayer's net wealth as at 1st January 2015. frax Net wealth of taxpayer (million Euros) rate I loa -1.30 [0.50] 1.30 - 2.57 [o.70) [2.67 -5.00 [1.00] [5.00 - 10.00 [1.25] 10.00 + 1.50] ipunwwatranceaccourtanls corm hlezan0'5 French income taxrates 2015 and French taxcdatabane The taxpayer is exempt from submitting a Wealth Tax declaration if their assets are below 1.3 million Euros. Basis of taxation ‘+ Non-residents are taxable on their French fixed assets (i.e. property) only, © French residents are taxable on their worldwide net wealth Filing deadlines: + Residents of France: June 15th * Residents of other EU countries: July 15th * Residents of other countries ‘August 15th Totop French company tax rates Is Impét sur les sociétés, 2015 rates: tax on 2014 profits. Currently there is a flat tax rate of 33.33% on profits on large companies. In addition, there are Social Contributions of 3.33%. For qualifying small-medium companies (tumover less than 7.63 million), there is a reduced tax of 15% on the first 38,120 Euros of profit. In order to qualify, the share capital of the company should be fully paid up and at least 75% of this share capital should belong to physical persons. As of 1st January 2012, there is a supplementary tax contribution (surtaxe) that applies to companies with tumover above 250 million Euros. French company tax is payable on account with payments due on a quarterly basis. Totop VAT (TVA-Taxe sur la Valeur Ajoutée) The current standard rate of VAT in France is 20%. This is the general rate applying to the supply of goods and senices There is a reduced rate of 5.5% or 10% which applies to certain goods and senices, including: * Food products; + Passenger transport; * Hotels, pensions, gites ruraux; * Cultural activities e.g books, cinema, theatre; * Certain works carried out in the main residence; Finally, there is a special rate of 2.1%, which applies to a limited scope of goods and senices. To top ipunwwatranceaccourtanls corm hl anezan0'5 French income taxrates 2015 and French taxcdatabane Capital Gains Tax on the sale of French property (plus-values immobiliéres) The sale of a resident's main residence is exempt from Capital Gains Tax. In other cases, the deductible cost is calculated as follows: © Purchase cost plus * Agency, notary costs etc. on purchase. If these are not calculated, a fixed percentage of 7.5% of the purchase cost is allowed. ‘+ Improvement / renovation costs, in the case where invoices can be produced. ifnot, 15% of the purchase cost is allowed if the sale takes place at least five years after acquisition The taxable gain (plus-value brute) is reduced according to the period that the property has been owned, and reaches zero after 22 years of ownership. This is for income tax purposes; Social Charges are reduced to zero after 30 years of ownership, There are also surcharges for capital gains over 50,000 Euros on the sale of property, as follows: Capital gain€ Additional tax € 50.000 - 60.000 2% lessmarginal deduction 60.000 - 100.000 2% 100.000 - 110.000 3% less marginal deduction 110.000 - 180.000 3% 160,000 - 160,000 4% less marginal deduction 160.000 - 200.000 4% 200.000 210.000 §% less marginal deduction 210.000 - 20.000, 3% 250.000 - 260.000 6% less marginal deduction 260.0006 + 0% For residents of France, there is currently 19% tax on the resulting gain; and Social Charges which are currently 15.5%. For non-residents, the following percentage of the taxable gain is withheld at source on sale of the property. ‘* Residents of the European Economic Area 19% * Others 33.33% Totop Taxe d'Habitation and Taxe Fonciére ipunwwatranceaccourtanls corm hl s7ezan0'5 French income taxrates 2015 and French taxcdatabane Those are French local property taxes. The Taxe d'Habitation is payable by the occupier of the property, and the Taxe Fonciére is payable by the owner. Both taxes are payable on an annual basis. Owner / occupiers of property pay both of these taxes. To top Income tax on capital income- interest, dividends and capital gains on investments. Up to 2012, the taxpayer could opt for French savings income to be subject to taxation at source, with no further income tax payable in their annual tax retum. This is known as a prélévement forfaitaire libératoire (PFL). This option was abolished as of 1st January 2013, with the exception of taxpayers with income of less that 2,000 Euros per annum. There will, however, still be tax withheld at source on this income. Capital income is to be declared in the annual tax return and taxable according to the normal income tax scale, with a deduction for any tax withheld at source. Dividends are subject to a general deduction of 40% to compensate for the company tax already paid on the profits being distributed. The fixed allowance from previous years has also been abolished. Capital income is also subject to Social Contributions (Contributions Sociales) of 15.5%. To top © Copyright France Accountants 2015 The information on this page is for guidance purposes only and should not be used as a substitute for proper professional advice. ipunwwatranceaccourtanls corm hl arezan0'5 French income taxrates 2015 and French taxcdatabane IF you are looking for information on tax france, or french tax, altematively income tax france then we can be of assistance. If you need assistance with french income tax rates then we will be happy to advise ipunwwatranceaccourtanls corm hl ca