Income tax withholding to apply to all staff in France from early 2019 Income tax withholding to apply to all staff in France from early 2019

Income tax withholding to apply to all staff in France from early 2019
01 Jun 2018

French employers will need to implement income tax withholding on the wages of employees who are resident in the country from the start of next year.

According to Bloomberg, they are already required to carry out income tax withholding at source on the wages of non-resident employees working in the country, and most countries already require income tax withholding at source on residents’ wages.

But rather than apply France’s progressive income tax rates for tax withholding for residents, the government plans to assign employers a fixed percentage to deduct from employees’ wages.

Employers will be required to collect French income tax from resident employees’ wages and report and pay those withheld amounts to the government using the same cycle of withholding, reporting, and payment that is in effect for social security contributions, he added.

It will also be necessary to implement an anonymous persons procedure for income tax withholding relating to resident employees whose employers do not obtain the fixed rate in time. It is likewise expected that employers in France will need to introduce an anonymous persons procedure for some employees in January and February due to the time it would likely take to process the required documents.

The global payroll community routinely votes France to be one of the three most complicated countries in the world for conducting payroll.

 Emma Woollacott

Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.

French employers will need to implement income tax withholding on the wages of employees who are resident in the country from the start of next year.

According to Bloomberg, they are already required to carry out income tax withholding at source on the wages of non-resident employees working in the country, and most countries already require income tax withholding at source on residents’ wages.

But rather than apply France’s progressive income tax rates for tax withholding for residents, the government plans to assign employers a fixed percentage to deduct from employees’ wages.

Employers will be required to collect French income tax from resident employees’ wages and report and pay those withheld amounts to the government using the same cycle of withholding, reporting, and payment that is in effect for social security contributions, he added.

It will also be necessary to implement an anonymous persons procedure for income tax withholding relating to resident employees whose employers do not obtain the fixed rate in time. It is likewise expected that employers in France will need to introduce an anonymous persons procedure for some employees in January and February due to the time it would likely take to process the required documents.

The global payroll community routinely votes France to be one of the three most complicated countries in the world for conducting payroll.

 Emma Woollacott

Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.

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