+ VIDEO It is indeed finally from January 2019 that the withholding at source becomes effective. Answers to the essential questions that are still being asked by the taxpayer.
It will not be a mandatory monthly payment, but a withholding tax (PAS) that will be applied to the French subject to income tax as of January 2019. In a cross-regime, the GSP should simplify the lives of some taxpayers, but the complexity of French taxation makes the transition delicate. Last minute adjustments have been made and there are still some problems, especially in the transition year 2018, which is not really a blank year.
Withholding tax for dummies
1 Can we still change the sampling rate?
The tax administration has already calculated the so-called "personalized" rate of your tax house. Without any action on your part, it is the one that will be applied. If the income of a few is very different, it may be interesting to submit an application for a so-called "individualized" rate, which will be calculated on the basis of the respective income of each pair (but ultimately it will be totally identical to be).
Third option, if you do not want your employer to know the applicable rate, the choice for a rate is "non-personalized" or "neutral". In this case, the employer applies the rate that corresponds to the remuneration of his employee, comparable to the rate that applies to a single person without children (see example). The employee must, if applicable, pay the tax authorities an amount corresponding to the difference between the application of his personal deductibility and the application of the non-personalized rate.
You can exercise these options via the online "Manage my charge" service accessible from the special section of the site impots.gouv.fr. Be careful, the deadline is 15 September.
2 What are the latest changes?
The collection of the source was against the pitfall of tax credits. The tariff that will be applied does not take into account these tax benefits. Taxpayers who benefit from this should therefore make a cash advance.
To limit this effort, beneficiaries of tax reductions or credits for home work, childcare for children under 6 years, or accommodation in Ehpad, as well as rental income or work grants or trade union contributions will receive a 60% deposit from the 15th January of the tax benefit that received the previous year. This advance is calculated on the basis of the tax situation in 2017. The balance is paid in July 2019.
In a previous version, the down payment was only 30% and only the niche of the services to the person.
3 How to do when you have employees at home?
Nothing changes for now. Employees must be paid the usual net amounts.
In 2019, the Pajemploi and Cesu centers will offer a complete range of services (the "all-in-one" option), which makes collection possible from 2020 onwards. The individual employer can, with the consent of the employee, entrust the center with the entire remuneration process.
The employer is deducted in one go from the amount of the net pay paid and the premiums and social contributions due minus the social benefits to which he is entitled. The center of Cesu or Pajemploi provides for the reimbursement of the social security contributions to the Urssaf and the source deduction at the DGFiP.
If the employer does not wish to use this "all-in-one" device, the center will immediately calculate the amount of the withholding tax and communicate to him the net amount after deduction at the source that must be paid to the employee.
For the employee, the payment of an annual payment in 2019 is made on the basis of the last known income.
4 What to do if your income falls?
If you are an employee, your rate is not immediately updated, but this is applied lower. The system of the tax at the source will be less punitive than the previous one, it is the effect "sign". If you do not request a rate adjustment, you must wait until September of the following year for the tax authorities to pay you back and calculate a new rate.
For self-employed persons (BIC, BNC, BA) and income from capital, the income tax of the current year will be dependent on installments. Calculated by the administration on the basis of the declaration of income from the year N-2 until September 2019. They will then be updated each year, in September. Terms are paid monthly or quarterly. The taxpayer may request an update during the year of the amount of the deposit on the website impots.gouv.fr.
5 Can we still optimize the transition year?
Since the income tax of 2019 will be paid in 2019, the tax due in 2018, the so-called transition year or "white year", will be canceled by modernizing recovery tax credits (CIMR). In order to avoid the optimization behavior of the concentration of revenue collection in 2018, the legislator has also determined that income that is considered exceptional is not covered by CIMR. The tax on this income must be paid in September 2019.
However, it is more interesting to collect extraordinary income in 2018. Admittedly, they will be taxed, but not as usual at the marginal tax rate. They are subject to the average rate calculated on all income.
Other strategies can be used punctually, especially in the area of pension savings.