Other Charges on Income
As well as takes from commercial operations or employment, there are other payments required in France...
Social charges are an additional tax levied on income and capital gains. They are effectively another form of income tax in France, payable on all forms of income received by French residents, including investment and pension income.
As a resident you are fully liable for social charges on investment income. You will only pay social charges on earned and pension income, however, if you are affiliated to the French healthcare system (for example, you are paying cotisations sociales or PUMA - Protection Universelle Maladie - contributions). This will automatically be the case if you are an employee or self-employed. If you have retired before you become a resident, you will not usually pay social charges on your pension income. However, you would become liable if you have been resident in France for three months and take up the option to claim PUMA benefits.
If you are a non-resident, you are only liable to social charges on rental income and capital gains made on French property.
Calculating Social Charges
Social charges are usually calculated based on the income declared in your tax return. The French authorities will send notification (avis d'imposition) of the amount payable in the autumn following the submission of your tax return.
Social charges are made up of six elements. The amounts are different for each type of income but the position can be summarised as:
|Salaries and unemployment benefits ||Retirement or Disability Pensions ||Investments, annuities, rental income, and capital gains|
|CSG (Contribution sociale généralisée)||7.5%||6.6%||8.2%|
|CRDS (Contribution au remboursement de la dette sociale)||0.5%||0.5%||0.5%|
|PS (Prélèvement Sociale)||0%||0%||4.5%|
|CA (Contribution additionelle)||-||-||0.3%|
|PdS (Prélèvement de Solidarité)||-||-||2%|
|CASA (Contribution additionnelle de solidarité pour l'autonomie)*||-||0.3%||-|
*The CASA applies to pensions, early retirement pensions and disability pensions from 2013. Retirees who are exonerated from income tax are exempt.
Social security contributions
A person working in France, as an employee or self-employed, must be registered with the social security organisation (caisse) which covers their particular occupation and pay social security contributions (cotisations).
If you are employed it is your employer’s responsibility to register you with the various caisses. Your employer pays their contributions and yours direct to the caisses and deducts your contribution from your salary. How much you pay depends on what you earn, and there are various ceilings and around 13 different ways of calculating social security, based on your profession, earnings, position in the company etc. The employer also makes substantial contributions that can reach 40 percent or 50 percent.
If you are self-employed, the basic procedure is the same but it is your responsibility to get yourself into the system. A typical cotisation might amount to 22 percent or 23 percent before social charges. There are usually more allowable expenses in reaching a taxable figure for the self-employed and the total percentage is a lot less than paid by an employer and employee combined.
If you are not covered by EU Form S1 and not working in France, you may be able to access the French state healthcare system by paying a charge based on your income to the system known as PUMA (Protection Universelle Maladie).
However, you can only access PUMA after three months of residency in France.
Tax rates, scope and reliefs may change. Any statements concerning taxation are based upon our understanding of current taxation laws and practices which are subject to change. Tax information has been summarised; an individual is advised to seek personalised advice.