France Payroll Compliance Map

Email: par4ww@evershinecpa.com
Manager Christine Yang, speak French, English and Chinese

WWT – France Payroll Income Tax Deduction

WWT-FR-01 WWT Tax Entity

Question from client:
Is the France salary income tax levied in national or department? Or both national and department?
Are the national and department personal income tax that levied separately? Or levied together?
What is the standard withholding tax rate?

Answer from Evershine RD:
Metropolitan France is used to collectively describe France’s European mainland, islands close to its European mainland, and islands otherwise in the Mediterranean Sea.
Metropolitan France consists of 96 geographical units known as departments. France’s departments are subdivided into districts (arrondissements).
The term Overseas France refers to all parts of France that are neither part of mainland Europe nor islands considered to be geographically part of Europe and includes five overseas departments, five overseas collectivities, the special collectivity of New Caledonia (Nouvelle-Calédonie), and additional islands.

The French overseas departments generally have the same tax and employment requirements as Metropolitan France, with few exceptions, but tax and employment requirements in other components of Overseas France differ from those in effect from Metropolitan France.
This primer covers payroll provisions as in effect for Metropolitan France and France’s five overseas departments.
Effective for 2021, France’s non personalized income tax withholding rates for residents of Metropolitan France and its five overseas departments, and the minimum and maximum amounts of monthly income for each tax bracket are as follows:

WWT-FR-02 Registration

Question from client:
The France salary income tax collection is under the jurisdiction of which government unit?
The registration of the France salary income tax collection status, that is, the application procedure for the employer withholding certificate number, paper certificate number application, or online account application? Website? Employer withholding certificate?
What is the advance certificate number?
Do you need to use the industrial and commercial certificate e-card to apply?

Answer from Evershine RD:
Two separate governmental organizations are responsible for taxation policy in France: The Minister of Economy, Finances, and Industry and the Minister for the Budget, Public Accounts, the Civil Service and State Reform.
The former is responsible for overseeing legislation related to the Tax Policy Board, which is a subunit of the Department of Revenue.
The latter is responsible for finance law and the administration of the taxation system.
The taxation system is organized into two offices: the Directorate General of Public Finance (Direction générale des Finances publiques, abbreviated as DGFiP) and the Directorate General of Customs and Indirect Taxes (Direction générale des douanes et droits indirects, abbreviated as DGDDI).
Within the first 15days of activity, resident employers must register with the local Center for Business Formalities (CFE) using the M0 form for companies.
Employers must declare their specific tax regime depending on their status as farmers, companies subject to corporation taxes or another category.
Businesses must register no later than the second business day following 1 May.

WWT-FR-03 WWT Order (OD)

Question from client:
What are the order of France’s salary income tax withholding declaration (information flow determines tax base) and payment (fund flow)?
Pay first and then declare?
Report first and then pay?
At the same time as the declaration and payment?

Answer from Evershine RD:
Deposit First (DF): Make monthly payments then file the required forms.

 WWT-FR-04 Mechanism of Filing (MOF)

Question from client:
France salary income tax withholding declaration (information flow determines the tax base)
What is the method of account return?
Reporting cycle: every month? Every bimonthly? Every season? every half year? Per year?
Electronic filing? Manual filing? Electronic filing and manual filing coexist?
If electronic filing is possible: Web site URL?

Answer from Evershine RD:
Withheld income taxes must be electronically remitted, and data regarding income tax withholding must be reported to the government using the employer’s déclaration sociale nominative (DSN), which is already in use for social taxes and is submitted using the Net-Entreprises portal.
The DSN must be submitted monthly. The dates for submitting the DSN and remitting withheld income taxes are as follows:

1. For employers with at least 50 employees, the DSN detailing income taxes withheld from wages paid during a month is to be submitted by the 5th day of the following month and income taxes withheld from wages paid during a month are to be remitted by the 8th day of the following month.
2. For employers with fewer than 50 employees, the DSN detailing income taxes withheld from wages paid during a month is to be submitted by the 15th day of the following month and income taxes withheld from wages paid during a month are to be remitted by the 18th day of the following month.
3. Employers with 10 or fewer employees may optionally remit withheld income taxes quarterly.

WWT-FR-05 Mechanism of Payment (MOP)

Question from client:
What is the funding method for the France salary income tax withholding payment (funding flow)?
Payment cycle: M per month? B every bimonthly? Q every season? H every six months? Every year?
Automatically authorize deduction of ACH (that is, take the initiative of the recipient)?
Electronic remittance to EFT (that is, the payer takes the initiative)?
Bank counter payment OCT?
Or the above methods coexist?

Answer from Evershine RD:
Taxes are remitted to the government either online or through telepayment.
Employers generating more than Euro 230,000 in their total sales of goods and services in a single tax year must pay taxes online.
Companies may also be required to pay their taxes through bank transfer when the tax liability exceeds Euro 50,000.
Withheld income taxes must be electronically remitted, and data regarding income tax withholding must be reported to the government using the employer’s déclaration sociale nominative (DSN), which is already in use for social taxes and is submitted using the Net-Entreprises portal.
The DSN must be submitted monthly.
The dates for submitting the DSN and remitting withheld income taxes are as follows:

1. For employers with at least 50 employees, the DSN detailing income taxes withheld from wages paid during a month is to be submitted by the 5th day of the following month and income taxes withheld from wages paid during a month are to be remitted by the 8th day of the following month.
2. For employers with fewer than 50 employees, the DSN detailing income taxes withheld from wages paid during a month is to be submitted by the 15th day of the following month and income taxes withheld from wages paid during a month are to be remitted by the 18th day of the following month.
3. Employers with 10 or fewer employees may optionally remit withheld income taxes quarterly.

BNF – Deduction of Employee Social Welfare

BNF-FR-01 BNF Entity

Question from client:
France’s social insurance, medical insurance, pensions, and another employee social welfare levy, is it National? Is it departments?
Or is there a national plus department? If there is a national and department, are they levied separately? or levied together? What is the withholding tax rate?

Answer from Evershine RD:
France’s social security benefit is levied at the national level.

BNF-FR-02 Registration

Question from client:
Social Security Certificate Number?
What is the name of the government agency in charge of social insurance?
Medical insurance certificate number?
What is the name of the government agency in charge of medical insurance?
Pension certificate number? The name of the government agency in charge of pensions?
How to apply for the social welfare certificate number for employees in the country?
Paper certificate number application? Or online account application? Website?
Need to use the industrial and commercial certificate electronic card to apply?
Are the above three certificate numbers unified or separate?

Answer from Evershine RD:
Employers must register their scheduled contributions with the French URSSAF.
Employers must file a Declaration Prior to Hiring (DPAE) 8 days prior to hiring a new employee.
This form registers the employer with the general social security system and triggers a new account with the URSSAF.

BNF-FR-03 BNF Order (OD)

Question from client:
What is the order of the withholding declaration of social welfare for France employees (information flow determines the tax base) and payment (fund flow)?
Pay first and then declare? Report first and then pays? At the same time as the declaration and payment?

Answer from Evershine RD:
Same period: Report and pay at the same time.

BNF-FR-04 Mechanism of Filing (MOF)

Question from client:
What is the method of reporting for withholding of social benefits for France employees (information flow determines the tax base)?
Reporting cycle: every month? Every bimonthly? Every season? every half year? Per year?
Electronic filing? Manual filing? Electronic filing and manual filing coexist? If electronic filing is possible: Web site URL?

Answer from Evershine RD:
Employers are required to remit withheld social welfare contributions levied on employee wages to the tax authorities through France’s Association for Collection of Social Security and Family Contributions (UnionsdeRecouvrement des cotisations de SécuritéSocialeet d’Allocations Familiales, abbreviated as URSSAF).
Employers must report data regarding social contributions electronically using the Nominative Social Declaration (déclaration sociale nominative, abbreviated as DSN), which may be filed through France’s Net-Entreprises online portal. Additional information regarding the DSN is available on France’s DSN homepage.
The DSN must be filed monthly. Social taxes must be electronically remitted, and data regarding social taxes must be reported to the government using the DSN, as follows:

• For employers with at least 50 employees, social taxes due for a month and the DSN detailing data regarding those taxes are to be submitted by the 5th day of the following month.
• For employers with fewer than 50 employees, social taxes due for a month and the DSN detailing data regarding those taxes are to be submitted by the 15th day of the following month.
• Employers with 10 or fewer employees may optionally remit social taxes on a quarterly basis instead of a monthly basis.
• Supplementary pension contributions due for a month must be remitted by the 25thday of the following month by employers with at least 10 employees, while employers with less than 10 employers make quarterly deposits by the 25th day of the month following the end of the quarter.
  Starting in 2023, supplementary pension contributions are to be paid to URSSAF instead of AGIRC-ARRCO.

BNF-FR-05 Mechanism of Payment (MOP)

Question from client:
What is the funding method for France employee social welfare withholding contributions (funds flow)?
Payment cycle: M per month? B every bimonthly? Q every season? H every six months? Every year?
Automatically authorize deduction of ACH (that is, take the initiative of the recipient)?
Electronic remittance to EFT (that is, the payer takes the initiative)?
Bank counter payment OCT?
Or the above methods coexist?

Answer from Evershine RD:
Employers generating more than €230,000 in their total sales of goods and services in a single tax year must pay taxes online.
Companies may also be required to pay their taxes through bank transfer when the tax liability exceeds €50,000.
The DSN must be filed monthly. Social taxes must be electronically remitted, and data regarding social taxes must be reported to the government using the DSN, as follows:

• For employers with at least 50 employees, social taxes due for a month and the DSN detailing data regarding those taxes are to be submitted by the 5th day of the following month.
• For employers with fewer than 50 employees, social taxes due for a month and the DSN detailing data regarding those taxes are to be submitted by the 15th day of the following month.
• Employers with 10 or fewer employees may optionally remit social taxes on a quarterly basis instead of a monthly basis.
• Supplementary pension contributions due for a month must be remitted by the 25thday of the following month by employers with at least 10 employees, while employers with less than 10 employers make quarterly deposits by the25th day of the month following the end of the quarter.
  Starting in 2023, supplementary pension contributions are to be paid to URSSAF instead of AGIRC-ARRCO.

Please be aware of below Warning:
The above contents are digested by Evershine R&D  and Education Center in October 2021.
Regulations might be changed as time goes forward and different scenarios will adopt different options.
Before choosing options, please contact us or consult with your trusted professionals in this area.

Contact Us

Paris Evershine BPO Service Limited Corp.
Email: par4ww@evershinecpa.com
Manager Zhu, speak in French English and Chinese

or
For how to exchange data files between your Finance Accounting System and Evershine  Cloud Accounting  Information System,
please send an email to HQ4par@evershinecpa.com
Dale Chen, Principal Partner/CPA in Taiwan+China+UK will be accountable to your case.
LinkedIn address: Dale Chen

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