iCalculator™ FR: France Tax Calculators
Welcome to iCalculator™ FR, your comprehensive suite of free tax calculators for France. iCalculator™ has provided free tax calculators for France since 2019. Since those early days we have extended our resources for France to includes Tax Guides, Tax Videos and enhanced the tax calculators and supporting tax information. The France Tax Calculator and salary calculators within our France tax section are based on the latest tax rates published by the Tax Administration in France. In this dedicated Tax Portal for France you can access:
France Tax Calculator 2023/24
The France Tax Calculator below is for the 2023 tax year, the calculator allows you to calculate income tax and payroll taxes and deductions in Jamaica. This includes calculations for
- Employees in France to calculate their annual salary after tax.
- Employers to calculate their cost of employment for their employees in France.
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Taxation in France
France, Officially the French republic, has a highly developed economy that is the 7th largest in the world, and 3rd largest in the European Union after Germany and The United Kingdom. The official language of France is French and the official currency is the Euro (EUR).
France is a founding member of the European Union and a member of Economic co-operation and Development (OECD), and the World Trade Organization (WTO). It has signed tax treaties with 125 jurisdictions and signed the OECD MLI (Multilateral Convention to Implement Tax Treaty).
Tax Administration of France
The Directorate General of Public Finance (DGFiP) is the revenue service in France. The tax agency is responsible for tax and customs in the country. The DGFiP runs its tax operations through the tax administration website.
Let’s discuss the details of various taxes that are levied on individual and corporate income in France.
Income tax - Individuals
France has a Pay As You Earn (PAYE) system, under which tax is withheld at source by the employer from the employee's remuneration, including pensions and other income deductions (e.g. Unemployment benefits).
Compliance for individuals
The Tax year for Individuals is the same as the calendar year: 1st January to 31st December.
Married couples and partners of PACS must file joint returns. Separate filing is only allowed for the first year of union otherwise it is not permitted at all.
Despite income tax deductions at source via PAYE, individuals in France are still liable for filing tax returns. Irrespective of the income bracket, all individuals must opt for E filing if they have access to the internet at their main home. Breaches are fined and other penalties are applied for any failure to comply with tax regulations.
- Tax Basis - Resident individuals are taxed on worldwide income and non-residents are taxed at French source based income.
- Taxable Income - Employment income, includes all employment benefits by the employer whether cash or kind. Business income, investment income, and capital gains are taxable as well.
- Rates - PIT is collected on progressive rates that varies from 0% to 45%, Plus a surtax of 3% on the portion of income that exceeds EUR 250,000 for single persons and EUR 500,000 for a married couple, and 4% of income that exceeds EUR 500,000 for a single person and EUR 1 million for a married couple.
A special social security surcharges for French residents of a maximum of 17.2% is applicable on all various kinds of income defined above.
Capital gains from the disposal of immovable assets are taxed at a flat rate of 19% plus a social security charge. The disposal of moveable assets such as stocks and bonds are taxed at 12.8% on income plus 17.2% social contribution which effectively makes the capital gains rate 30%.
There is no capital duty tax or capital acquisition tax in France, also stamp duty is charged at a nominal rate.
- Inheritance tax - Assets transfer between close relatives are taxed ranging from 5% to 45%. There is a rebate of EUR 100,000 per child available on this tax.
- Real property tax - Rental income for residential apartments are taxed at the normal PIT rates after the deduction of all the expenses borne by the landlords. Owners are liable for a tax based on the rental value of the property assessed by the tax authorities.
- Net worth tax - Net worth taxes are levied on real estate assets only. This is applied to the net worth exceeding EUR 1.3 million for the combined household (not individual). Non-residents are charged at progressive rates between 0.5% and 1.5% on their property in France.
Deduction and allowance
Salaries and related benefits are taxed after deducting social security contributions and qualifying professional expenses.
Personal expenses such as child support and alimony or support payment made to parents, grandparents and children above 18 or married children may qualify as deductible expenses. The qualification criterion for deduction is that the beneficiaries of these payments are in need of the funds and the needs can be demonstrated.
Income tax - Corporate
Resident and non-resident companies are subject to tax on their French-source income only. Foreign source income of French residents is generally not taxable. Non-resident companies are taxed on real estate income as well that is derived from a French source.
Compliance for corporations
The tax year is generally aligned with the calendar year, a different tax year may be requested that can be shorter than 12 months in special cases.
Corporate taxes are to be filed within 3 months following the end of the tax year for non calendar financial years and by 30 April of the following year for all others.
Consolidated returns are permissible upon meeting the defined criteria. Penalties of 10% are applicable for late payments, also, interest and penalties are payable for late filing and failure to comply with the tax law.
The standard corporate income tax rate is 31% with a reduced rate of 28% applied to the first EUR 500,000 of taxable income. The standard rate of 31% plus 3.3% surtax (effective rate of 32.02) is applied to companies with turnover below EUR 250 million. 33.33% plus 3.3% surtax (effective 34.43%) the CIT is levied on companies with turnover above EUR 250 million.
The tax rates are expected to be progressively reduced by 2022. Small or new business may benefit from lower rates provided certain conditions are satisfied.
Dividends and capital gains may be exempt from corporate tax, given they meet all the requirements.
A tax credit of 30% is offered in France on the qualifying research and development (R&D) Credit under the tax incentive regime. The expenses are limited up to 100 million or 5% above this limit, given all the conditions are met.
A patent box regime may be applied on or after the financial years commencing after 1 January 2019, under which income and capital gains derived from patents are taxed at the reduced rate of 10%.
Net operating losses may be carried forward indefinitely, however, carry back of losses is permitted for one year only, provided certain conditions are met.
- Dividends - Dividends paid by a French company to non-resident shareholders are subject to a 30% withholding tax, unless a tax treaty provides a caveat for a lower rate. Certain cases that come under EU parent-subsidiary directive are also taxed at a reduced rate.
- Royalties & Interest - Royalties are subject to a standard withholding, corporate income tax when paid to nonresidents (including nonresident individuals). The rates may be reduced if they fall under tax treaties or can be exempted from tax if they fall under EU interest and royalties directive.
Interest paid by a French company to a nonresident lender is generally not subject to withholding tax.
- Technical service fee - Fees paid for commissions, consultancy services are subject to a standard withholding corporate income tax. The rates may be reduced if they fall under tax treaties or can be exempted from tax if they fall under EU interest and royalties directive.
- Branch Remittance tax - The “after tax income” of a French branch of a foreign company that is distributed to non-residents is subject to 30% withholding tax. This may be reduced or eliminated under certain tax treaties.
Note: Withholding taxes, in line with the reduction in standard corporate tax, are expected to be reduced by the year 2022.
Other taxes on corporations
Real property tax and CET- Resident and non-resident companies operating in France must pay the CET (Contribution Economique Territoriale). This has two components: A real property tax and tax calculated on adjusted gross revenue of French business.
- Social security - An employer is subject to a contribution towards social security for its employees. The rates vary depending on the size, location and the type of business. In certain cases, employer contribution can exceed 50% of gross salary. The employee contribution is generally withheld at the source by the employer at the rate of 20%.
- Payroll tax - This applies to the businesses that collect revenue not subject to VAT.
- Stamp duty - Only nominal stamp duties are levied in France.
- Transfer Tax - The standard rate of 5.8% is applied to the sale of real estate. The transfer of goodwill is subject to a registration duty of 3% on the part of the transfer pricing amount EUR 23,000 to EUR 200,000, and at 5% on the part that is exceeding EUR 200,000.
Transfer of shares is subject to a registration duty of 0.1% with no cap.
Value added tax (VAT)
VAT is generally applied on imports, and supply of goods and services performed in French VAT territory. You can calculate VAT in France using the France VAT Calculator.
- Rate - VAT is levied at the standard rate of 20% with reduced rate of 5.5% of 10% applied to most food products and certain other items. A special rate of 2.1% is payable on pharmaceutical, reimbursed by social security system.
- Filing and payment - Entities subject to VAT must register with tax authorities. Filing requirements vary as per the business nature and other factors. Consolidated VAT payments are permitted for companies that belong to the same group, however, consolidated VAT returns are not permitted.