Income tax 2020: Who gets a rebate and who might owe money?
Tax returns in France were filed in June and now authorities are calculating tax rates. But the combination of the new system of payment at source and the old system of yearly returns means that some people will be due money back, while others will face a bill. Here's how it works.
What happens next once you have filed your return?
The tax return you filed in May or June will allow authorities to summarise your tax situation in France and to calculate the final tax amount you owe for your 2019 income.
Everyone who lives in France must file an annual return, even if all your income derives from another country.
But the French tax system is currently undergoing an overhaul, with the introduction in January 2019 of 'pay as you earn' income tax for employees.
But the amount deducted from your payslip can differ from the official amounts that were declared throughout the year. This means some tax payers will get reimbursed while others will owe money to the French tax authorities.
Each year, you have to declare your income to the French tax authorities. Photo: AFP
Will you get money back or owe some?
First of all, if the calculated income tax is equal to the amounts that were already taken at the source in 2019, then your situation is stable and there is nothing to do.
However, if the amount of the income tax that was calculated differs from the amounts already withheld at the source in 2019, there are two scenarios:
If the amount of the income tax is lower than the withheld amount: the tax authorities will reimburse that overpayment on July 24th 2020 or on August 7th 2020 with a transfer on your bank account (or with a cheque sent to your home if you haven’t given them bank account details).
Former French Minister of Public Action and Accounts Gerald Darmanin at a press conference in Paris in January 28, 2020, on the income tax at source system one year after its implementation. Photo: AFP
If the amount of the tax income is higher than the deducted amount: the income difference in order to pay the balance will be debited as of September 25th 2020, in one go if it’s €300 or more or in four installments if it’s higher than €300.
Either way, the authorities calculate it and make the payment or the debit, so there is nothing that you need to do.
It is important, however, to make sure that the bank account number you gave to the tax authorities is the right one, if you haven’t already. You can do that by logging into your Espace Particulier on impots.gouv.fr, in the section Gérer mon prélèvement à la source.
If you’ve think you made a mistake on your return, you still have time to correct it.
As soon as your tax return is available online at the beginning of August 2020, you can log onto your Espace Particulier on impots.gouv.fr and click on the section Corriger ma declaration.
And if you're reading this article with a growing sense of dread at the realisation that you should have filed a declaration in June but have not done so, then the best course is to go down to your local tax office and 'fess up immediately.
French tax authorities are generally pretty helpful to people who have made a genuine mistake and as long as you get in contact and explain your situation you are unlikely to be fined - which could be the case if you say nothing and they catch up with you.
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What happens next once you have filed your return?
The tax return you filed in May or June will allow authorities to summarise your tax situation in France and to calculate the final tax amount you owe for your 2019 income.
Everyone who lives in France must file an annual return, even if all your income derives from another country.
But the French tax system is currently undergoing an overhaul, with the introduction in January 2019 of 'pay as you earn' income tax for employees.
But the amount deducted from your payslip can differ from the official amounts that were declared throughout the year. This means some tax payers will get reimbursed while others will owe money to the French tax authorities.
Each year, you have to declare your income to the French tax authorities. Photo: AFP
Will you get money back or owe some?
First of all, if the calculated income tax is equal to the amounts that were already taken at the source in 2019, then your situation is stable and there is nothing to do.
However, if the amount of the income tax that was calculated differs from the amounts already withheld at the source in 2019, there are two scenarios:
If the amount of the income tax is lower than the withheld amount: the tax authorities will reimburse that overpayment on July 24th 2020 or on August 7th 2020 with a transfer on your bank account (or with a cheque sent to your home if you haven’t given them bank account details).
Former French Minister of Public Action and Accounts Gerald Darmanin at a press conference in Paris in January 28, 2020, on the income tax at source system one year after its implementation. Photo: AFP
If the amount of the tax income is higher than the deducted amount: the income difference in order to pay the balance will be debited as of September 25th 2020, in one go if it’s €300 or more or in four installments if it’s higher than €300.
Either way, the authorities calculate it and make the payment or the debit, so there is nothing that you need to do.
It is important, however, to make sure that the bank account number you gave to the tax authorities is the right one, if you haven’t already. You can do that by logging into your Espace Particulier on impots.gouv.fr, in the section Gérer mon prélèvement à la source.
If you’ve think you made a mistake on your return, you still have time to correct it.
As soon as your tax return is available online at the beginning of August 2020, you can log onto your Espace Particulier on impots.gouv.fr and click on the section Corriger ma declaration.
And if you're reading this article with a growing sense of dread at the realisation that you should have filed a declaration in June but have not done so, then the best course is to go down to your local tax office and 'fess up immediately.
French tax authorities are generally pretty helpful to people who have made a genuine mistake and as long as you get in contact and explain your situation you are unlikely to be fined - which could be the case if you say nothing and they catch up with you.
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