Extract from: Living & Working in France, published by Kogan Page, www.koganpage.com, paperback, 368 pages, £14.99.

Income tax - les impôts sur le revenues

Income tax was introduced in France on 13 July 1914. The rate was just two percent!

As a resident in France (or as an individual who has spent at least 183 days working or residing in France over the course of a fiscal year or over 12 consecutive months), you will have the privilege of paying French taxes. Agreements between France and some other countries have limited the possibility of double taxation – that is, paying tax in France and in your own country. If you work simultaneously in tow countries, you should enquire at your local tax office in your country of residency. Stock options are taxable as income. Some companies offer assistance in filing out tax forms. If your company does not offer such help, the tax office in your area will advise you.

- Deductions may be taken for family dependants according to the number and age of those dependants living with you.

- A small deduction is possible for domestic help, and for charitable donations.

- The actual tax imposed is based on the final total after deductions, and varies from 0 percent to 48.09 percent.

- Since 1991, there is a supplementary social security tax, the CSG (contribution social génénerale) to which was added the CRDS (contribution pour le remboursement de la dette sociale) in 1996. These new taxes are intended ot reduce the social security deficit. They are applied to professional and personal assets.

Declaring income - déclaration des revenues

The declaration of income is obligatory if you are employed or if you have a private income. The declaration is made prior to 1 March each year; the form entitled ‘Votre Déclaration de Revenus’ should be completed on the internet or sent to your local tax office. You may obtain the form at your local mairie for your first declaration.

N.B. Remember, as France has certain reciprocal agreements with numerous countries, it is unlikely that you will be able to avoid making your contribution… and a fine of 10 percent is added to late declarations!

If you work in more than one country, you should have asked your local tax office how best to benefit from international agreements concerning double taxation. Foreign income should be declared on a special form. There are over 100 international tax agreements.

THREE OR TWELVE PAYMENTS - MENSUEL OU PAR TIERS

Income tax is not deducted at source. It is up to you to make the necessary declaration and, subsequently, payment. Payment of taxes is traditionally made three times a year in France (15 February, 15 May and 15 December) but monthly payments, which avert the agony of making three large payments, are becoming more common. You may choose the system you prefer. The amount of the payments, whether monthly or in thirds, is based on the amount paid the previous year. Monthly payments are made over 10 months, from January to October, by automatic deductions from your bank account. The remaining debt is paid in November and December based on the actual amount due.