Starting Thursday, April 10, 2025, taxpayers across France will be able to submit their 2024 income tax returns.
The Direction générale des finances publiques (DGFiP), which oversees tax collection, has confirmed this date. Notably, they have yet to announce the final deadline for submission, which often varies depending on whether individuals are filing online or via paper, as well as their place of residence.
This year’s income tax regulations come with significant updates aimed at easing the tax burden on individuals as inflation figures continue to rise.
Firstly, the progressive tax brackets have been adjusted for inflation to the tune of 1.8%. This adjustment is lower than the anticipated 2% reassessment proposed by the government’s finance bill, which had been based on earlier inflation projections. The INSEE, France’s national statistics bureau, confirmed the inflation rate at +1.8% for this year, leading to the final adjustment.
It’s important for taxpayers to understand the new tax brackets as they prepare to file:
- Taxpayers earning less than €11,497 will owe no income tax at all.
- A rate of 11% applies to income between €11,497 and €29,315.
- For earnings between €29,315 and €83,823, the tax rate will be 30%.
- Those with incomes ranging from €83,823 to €180,294 will face tax at 41%.
- Finally, earners above €180,294 will be taxed at the top rate of 45%.
Another notable change is the implementation of the individualized rate as the default option. This means taxpayers' withholding at source will now reflect their individual situation rather than the collective financial circumstances of their household. Until now, the tax was based on the household's shared income level. Although this change won’t affect the overall tax amount owed by the household, it alters how the tax liability is distributed among its members.
Taxpayers who prefer not to adhere to this new individualized rate can opt out when making their declaration, starting with the opening date of the tax season on April 10.
The aim of these adaptations, according to the DGFiP, is to prevent situations where individuals might suddenly become tax-liable due to nominal income increases during inflationary periods, often referred to as fiscal drag.
With increasing costs of living influencing many aspects of the economy, the French government aims to cushion the impact on everyday citizens and particularly low-income households. The adjustments to income tax brackets are among several efforts by the administration to maintain fairness and equity amid changing economic conditions.
This year’s tax campaign is important not only for its adjustments but because it reflects the government's acknowledgment of the challenges presented by inflation and the broader economic climate. With varying expiration dates depending on where taxpayers reside—particularly between those filing online and those choosing traditional paper submissions—the specifics of individual deadlines are to be announced.
This initiative is expected to ease what could have been a considerable burden on households struggling with increased living costs. The progressive nature of the taxation system ensures some levity for lower-income individuals and families.
French citizens and residents will do well to prepare early and understand these changes to avoid any last-minute surprises come tax time.
These alterations not only help manage the immediate fiscal pressures of the current economic environment but also reflect longer-term strategies aimed at stabilizing household finances and promoting taxpayer compliance.
