Selecting a language will automatically trigger the translation of the page content.

Salary tax

Verified 12 January 2022 - Directorate of Legal and Administrative Information (Prime Minister), Ministry of Finance

The payroll tax is payable by employers established in France who are not subject to value added tax (VAT) on their total turnover. It is calculated on the remuneration paid during the year by applying a progressive scale.

It is due by the employer who is domiciled or established in France, regardless of the place of residence of the employee or his activity, and who meets one of the following conditions:

  • In the year of payment of remuneration, he is not subject to payment of the VAT: titleContent
  • In the year of payment of remuneration, it is partially taxable at VAT: titleContent and was subject in the previous year to VAT on less than 90% AC
  • The year before the remuneration is paid, less than 10% of its turnover is subject to VAT

For example, the tax applies to:

  • Some professions
  • Public establishments other than groupings of communes
  • Banking and financial institution, insurance, certain insurance brokers and foreign exchange agents
  • Administrative or social organisation (association, for-profit organisation, etc.)
  • Business engaged in a civil activity (investment business, real estate business), except business of building or trading in property
  • Landowners
  • Co-operative organisations, mutualists and agricultural professionals

Example :

The employer is subject to the payroll tax as 2022 (calculated from the remuneration paid in 2021) if one of the following 2 conditions is met:

  • It was not subject to VAT payment in 2021
  • It was subject to VAT on less than 10% the turnover achieved in 2020

FYI  

taxable remuneration need not be paid by the french employer. They can also be paid on behalf of the French employer by a company located at the foreigner.

The following employers not subject to the payroll tax:

  • Individual employers of a home employee or a maternal assistant. This must be a full-time person or several part-time persons representing a full-time equivalent. The individual employer of a part-time home employee is therefore not exempt from tax.
  • Some agricultural employers (e.g. cultivated and farmed farms, training and training farms)
  • Higher education institutions with a baccalaureate +5 (e.g. universities, business schools, colleges)
  • Employers whose previous calendar year's tax-free turnover does not exceed VAT-free (e.g. self-employed entrepreneurs)
  • Some public institutions

The payroll tax is based on the CSG base applicable to salaries (includes all income of natural persons except in case of exemption).

Amounts taken into account in calculating the payroll tax

Sums

Is this taken into account when calculating the tax?

Amounts due in consideration or in connection with work

Yes

Artists' income

Yes

Staff allowance and parliamentary allowance

Yes

Guarantee of the resources of disabled workers

Yes

Income from the lease of all or part of a business, commercial, craft or industrial establishment

Yes

Professional income of the self-employed

Yes

Flat-rate deduction for professional expenses

No

Amounts corresponding to replacement income (compensation in case of accident at work or sickness, social security benefits paid through the employer...)

No

Contributions to Training Insurance Funds

No

Remuneration paid by industrial technical centres

No

Daily social security benefits

No

Partial or Termination Allowances

No

Part of the salary paid to apprentices equal to 11% minimum wage growth in a company of more than 10 employees (apprenticeship contracts)

No

Salaries paid to apprentices by a company of less than 11 employees (apprenticeship contracts)

No

Teachers' Compensation at Apprentice Training Centres (CFA)

No

Compensation paid in connection with employment or future contracts (CUI-CAE contract)

No

Savings for trainees within the limit of the contribution exemption (the share above the minimum amount is subject to tax)

No

FYI  

exempt remuneration is still subject to the CSG.

The company that is subject to VAT on less than 10% of the turnover made the year before the payment must pay the tax on the wages by calculating its reporting.

Calculation = (Revenue not eligible for VAT deduction (year N-1) / total revenue (year N-1)) x 100

For these companies, tax base on salaries is obtained by multiplying the total amount of taxable remuneration (year N) by the ratio of the taxable remuneration:

Calculation = Total taxable earnings (year N) x Coverage

Example :

Taxable earnings (year N) = 100

Total revenue (year N-1) = 300 broken down as follows:

  • Revenue for transactions outside the scope of VAT: 160
  • Revenue corresponding to transactions within the scope of VAT: operation taxed: 60, exempt transaction not eligible for deduction: 80.

The salary tax liability ratio is: ((160 + 80) / 300) x 100 =80%

For these bodies,tax base is equal to: 100x 80% = 80.

FYI  

if the annual amount of tax is less than €1,200, the tax is not due. There is then no declaration of liquidation and regularisation to be filed.

In mainland

The tax is calculated from a progressive scale that applies to annual individual remuneration paid (taxable basis).

The scale shall include a normal rate, applied to the total amount of individual gross remuneration, and increased rates, applied to individual gross remuneration that exceeds certain thresholds.

Rate based on gross salary for each employee

Rate Type

Global Rate

Fraction Rate

Annual gross salary paid in 2021 (tax payable in 2022)

Monthly gross salary paid in 2021 (tax payable in 2022)

Normal

4,25%

4,25%

Up to €8,020

Up to €668

1to increased rate

8,50%

4,25% (8.50 - 4.25)

Between €8,020 and €16,013

Between €668 and €1,334

2nd rate increased

13,60%

9.35% (13.60 - 4.25)

Greater than €16,013

Greater than €1,334

The tax base and the net amount of tax due shall be rounded to the nearest euro.

Example :

For an employee who was paid a monthly gross salary of €5,600 in 2021, the payroll tax calculation is as follows:

[5600x 4,25%] + [(1334-668)x 4,25%] + [(5600 - 1334) x 9.35%= €665.76

For this employee, the payroll tax that the employer will have to pay in 2022 is: €665.76 rounded to €666.

Overseas

Guadeloupe, Martinique or Reunion

The 2.95% applies to the total individual gross remuneration.

Guyana or Mayotte

The 2.55% applies to the total individual gross remuneration.

The discount is a reduction in the amount of tax payable.

The allowance is a lump sum or proportional reduction applied on the basis of the calculation of a tax (income, value of property, etc.). It only concerns associations.

Discount to Employer

An employer whose annual amount of tax is between €1,200 and €2,040 shall receive a discount equal to 3/4 of the difference between this €2,040 and the actual amount of his tax.

Example :

If the annual salary tax amount is between €1200 and €2040., the haircut is: 0.75 x (€2040 - actual amount of tax).

This mechanism also applies on a monthly or quarterly basis.

For example:

  • If the monthly salary tax amount is between €100 and €170, haircut = 0,75 x (€170 - actual amount of tax)
  • If the quarterly amount of the payroll tax is between €300 and €510, haircut = 0,75 x (€510 - actual amount of tax)

The amount of tax due to be shown on line A of 2501 or 2501 K is the amount of tax due after the discount is applied.

This haircut is regularised at the time of the annual liquidation on the annual winding-up and regularisation declaration n°2502.

Collapse Associations

Associations shall be entitled to a €21,086 for the tax due for salaries paid in 2021.

This tax is therefore payable only for the part of its amount exceeding this amount.

The bodies concerned are:

  • 1901 Law Association
  • Association located in the Bas-Rhin, the Haut-Rhin or the Moselle
  • Trade union and its unions
  • Authorised Intermediate Association
  • Some mutual
  • Foundation recognised as a public utility
  • Cancer Control Centre
  • Groupement for Health Cooperation and Social and Medico-Social Cooperation (it must be made up of legal persons who benefit from a reduction in the amount of tax on wages normally due)

The rates of return to the tax department and payment of the tax (monthly, quarterly or annual) and the amount to be paid are determined by the employer according to the amount of tax paid in the previous year.

Répondez aux questions successives et les réponses s’afficheront automatiquement

Less than €1,200

There is no statement to make.

Between €1,200 and €3,999

The company must make a annual declaration before 15 January of the year following the payment of salaries. She will use annual return form 2502.

Between €4,000 and €10,000

The company must make its declaration every 3 months within 15 days of the previous quarter.

He will have to provide 3 instalment statements No 2501 before 15 April, 15 July and 15 October.

She will also have to send a regularisation statement No 2502 before January 31 of the year following the payment of the remuneration.

From 10 001 €

The company must declare every month within 15 days of the previous month.

It will be required to provide 11 instalment statements No 2501 (1 for each month) and a declaration of regularisation No 2502 before 31 January of the year following the payment of the remuneration.

In the event of transfer or cessation of business, the employer must file the return within 60 days.

In case of death of the employer, the declaration must be made within 6 months.

Warning  

payment of the tax must be made by dematerialised channel in the company's professional space or through an EDI provider.

To small and medium-sized and micro-entreprises, do you have a business project, a difficulty or a question ?

Quick and simple public service: you will be contacted over the phone by one of our experts.

Speak with an advisor on Place des Entreprises