1.5 French Income Tax Rates

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The tax scale for the tax year 2008 (for income earned in 2007) applicable to each ‘part’ in a household is set out below.

The rates are applied on a sliced basis so that each ‘part’ of the income is charged on a progressive basis.

There are five tax bands, as follows:

Table: French Tax Bands - 2008

Income Share	Tax Rate
Up to €5,687	0%
Between €5,688 & €11,344	5.5%
Between €11,345 & €25,195	14%
Between €25,196 & €67,546	30%
Above €67,546	40%

On the basis of these rates we show below an approximate guide to the net income you would need to earn in 2008, by household size, before you would be liable to pay income tax.

Table: Income Thresholds in France - 2008

Household Size	Income
Single Adult	€11,404
Single Adult + Child	€14,340
Two Adults	€17,184
Two Adults + Child	€20,027
Two Adults + Two Children	€22,871

Those aged at least 65 years, or those suffering a major disability, whose gross income does not exceeed €21,860 (per person), get an allowance before their income becomes liable for tax, so the threshold applicable in these cases is several hundred euros higher.

If your net income (as determined by the tax authority) was higher than any of these figures, but you were entitled to an income tax credit (say, for energy conservation works), then the value of the credit would be set against the amount of tax for which you were liable.

If you are liable to less than €61 in income tax, then no tax charge is made, and below a tax charge of €838, a rebate is payable to you, on a formula basis, that would lower the amount you would actually be required to pay! We have taken into account these two concessions in the threshold figures given in the table.

At the top end, the government have also introduced a ‘cap’ on the amount of taxation that you should be obliged to pay.

This cap is called the bouclier fiscal and is set at 50% of net income for total taxes from income tax, wealth tax, the social welfare levies (CSG/CRDS) and local taxes.

It is unlikely you would benefit from this cap unless you were liable to income tax at the highest rate, and also paid wealth tax.

If you are in the fortunate position of being eligible for recovery of overpaid taxes, you are probably going to need an accountant to take you through the whole process, as the calculation is not an easy one to make!

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Next: Payment of Income Tax