Family Tax Credit (CIF)

Verified 25 March 2025 - Directorate for Legal and Administrative Information (Prime Minister)

The purpose of the Family Tax Credit (FTC) is to encourage companies to incur expenses that enable their employees to reconcile their family and professional life. It allows companies to deduct part of their expenses from their taxes. The CIF rate varies according to the categories of expenditure incurred. The amount of the tax credit is capped at €500,000/year.

Any company who has employees may benefit from the tax credit if it is subject to a actual taxation system (normal real speed or simplified real speed) The company may be subject to income tax (IR) or to business tax (IS).

A company subject to the micro-company scheme cannot therefore benefit from the family tax credit.

FYI  

A company that does not have an employee may also claim the family tax credit for expenses incurred as a result of the payment of aid to finance personal services activities. This also applies to the expenditure on personal services incurred by the company which has benefited from the "pre-financed CESU".

The Family Tax Credit (FTC) covers the following expenses:

  • Expenditure for the establishment and operation of a private establishment for children under the age of 6. This facility must be operated directly by the company and it must accommodate the children of its older employees under 3 years of age
  • Payments made directly by the company for the care of the children of its employees under the age of 3 years in private or public bodies
  • Expenditure to finance personal services.

Tax credit rate

The rate of the tax credit varies according to expenditure type carried out by the company.

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Expenditure on childcare in an establishment

This concerns the following expenditure:

  • Expenditure on the establishment and operation of private establishments for children under 6 years of age (crèche, drop-in center)
  • Payments made for the care of children in establishments run by bodies outside the company (crèche, drop-in center)

The tax credit is 50% the amount of such expenditure.

Expenses to fund personal services (AMP)

This concerns expenditure paid to employees by the company Committee or the company itself and intended to finance or facilitate access to:

  • activities falling within the scope of personal services (SAP)
  • activities provided by private establishments for children under the age of 6

The tax credit is 25%the amount of expenditure.

The calculation of the family tax credit is made by calendar year.

Its amount shall not exceed €500,000 per year.

Deduction of grants received

The public aid (grants) received by the company in respect of their expenditure eligible for the family tax credit (CIF) are deducted from the basis of calculation the tax credit. This aid is therefore not recorded as an expenditure in the calculation of the CIF.

The aid to be deducted from the CIF calculation basis is that paid in the year in respect of which the tax credit is calculated.

Example :

A company spends €50,000 for the care of the children of its employees in a specialized establishment, and €275,000 to fund personal services.

The amount of the credit that she will receive is equal to €50,000 x 50% + €275,000 x 25% = €93,750.

If his tax is equal to €250,000 in 2024, with the benefit of the tax credit, this amount will equal €250,000 - €93,750 = €156,250

The rules vary depending on the company's tax regime.

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Company subject to income tax (IR)

The company subject to income tax (IR) must send the calculation aid form No. 2069-FA-SD with its supplementary income statement No 2042 C pro.

Company subject to business tax (IS)

The company subject to business tax (IS) must attach the tax form 2069-FA to his statement of balance of IS No. 2572-SD.

The tax credit allows you to shrink the amount of tax that the company must pay, thus reducing its tax by the amount of the tax credit.

Where the amount of the tax credit to which the company is entitled is greater than the amount of its tax, the tax authorities shall refunds the surplus.

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Company subject to income tax (IR)

The company must defer the amount of the tax credit it is claiming on its income tax return 2042-C-PRO.

Company subject to business tax (IS)

The company must apply for a refund using the following document:

Corporate Tax and Related Contributions - Application for Refund of Tax Credits

This can be done by:

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