What a headache taxes are! In theory, all your income is taxable. Except that in practice, it is more complicated. What you need to know before filing your 2023 income tax return.
Since Thursday, you can declare your 2023 income until June 6 maximum. This year again, at least 11 million taxpayers will be able to escape the chore thanks to automatic declaration.
In any case, it is always better check if the declaration pre-filled by the tax authorities does not contain errors to avoid paying too much tax. Certain income is exempt… sometimes with some subtleties. Here are the main exemptions to keep in mind as you dive into the 2024 declaration.
Overtime
Good news, for 2023 income, the annual exemption ceiling remains this year 7,500 euros, net taxable, or 8,037 euros gross.
If overtime earned you, last year, 1500 euros gross, or 1215 euros net of tax, this amount is exempt from tax, for example. Another illustration: your overtime earned you 9,800 euros gross, or 7,938 euros net of tax. L, the taxable amount is 438 euros, illustrates the public service site.
The amount of wages paid for exempt overtime or additional hours must appear in lines 1GH to 1JH of the declaration. This amount is used to calculate the reference tax income.
Certain exceptional bonuses
The value sharing bonus (PPV), or Macron bonus, collected between July 1, 2023 and December 31, 2023 is exempt from income tax up to a limit of 3,000 euros per beneficiary and per calendar year.
The exemption is reserved for employees who received, during the twelve months preceding payment of the bonus, remuneration less than three times the annual value of the SMIC corresponding to the working period provided for in the contract.
An exemption ceiling of 6,000 euros also applies in companies covered by a profit-sharing agreement or, in companies with fewer than 50 employees, by a participation agreement on the date of payment of the bonus.
The amount of the exempt PPV must be specified on lines 1AD to 1DD. You must then check the boxes 1AV 1DV if you benefit from the increase in the exemption threshold of 6000 euros.
The perverse effects of the Macron bonus
Tips exempt
Tips are once again exempt from income tax for employees, in contact with customers, whose remuneration does not exceed 1.6 SMIC. This exemption concerns sums voluntarily given to employees; or the employer who pays them to the servers. The amount of exempt tips must be entered on lines 1PB 1PE.
Income of apprentices and students
Since 2021, the income of apprentices and students must be declared in full. But the salaries of young people aged 25 or less on January 1, 2023 are exempt within the limit of 3 monthly minimum wage, i.e. 5204 euros. For internships or apprenticeships, the exemption ceiling is applicable 20815 euros. A valid advantage whether there is attachment to the parents’ tax household or not.
Restaurant vouchers, holiday vouchers…
Many benefits (RSA, activity bonus, housing allowances, back-to-school allowance, Christmas bonus, family benefits, benefits linked to a disability situation, etc.) are exempt from income tax. This is also the case for restaurant vouchers when the employer’s contribution is lower 6.91 euros by ticket or for every vacation check when your boss’s annual contribution, if applicable, by the works council, does not exceed the monthly amount of the minimum wage (1747 euros).
Booklet A, PEL, life insurance….
Income from the Livret A, the Sustainable and Solidarity Development Booklet, the Popular Savings Booklet or the Youth Booklet is not taxable. The same goes for Home Savings Accounts opened before 2018 or for Home Savings Plans open until December 31, 2017. The latter benefit from a tax exemption until the twelfth anniversary of the plan.
In the case of life insurance, there is an overall annual reduction of 4600 euros for a single person, on all gains made during life insurance purchases over 8 years old.
As for the Stock Savings Plan, from 5 years of ownership, the capital gains made are not taxable, and subject only to social security contributions. With exceptions from May 2024.
Transportation aid
The employer is required to reimburse, up to 50%, the amount of the subscription for public transport or public bicycle rental services for commuting. This assistance must not be mentioned by the employee in his declaration. Same for the sustainable mobility package, within the limit of 700 euros per year. This device is intended for getting to work by bike or carpool. The employer can also cover the home-work fuel costs of its employees and these are not taxable up to 400 euros. This limit is increased to 900 euros including 600 euros for fuel costs in overseas departments.
Untaxed compensation
Certain compensation for termination of an employment contract escapes the tax authorities, in whole or in part, such as for dismissal as part of a job protection plan. Concerning the daily allowances paid by the Scuor the agricultural social mutuality, for illness involving prolonged treatment for example, they are not taxable, just like those distributed in the event of a work accident or occupational illness, and this up to 50% of their amount.
Le Bon Coin, Vinted, Blablacar… exempt income
Do you resell your old items on leboncoin.fr or even Vinted occasionally? Your gains are not in theory reported on the income tax return, unless the sale price of an asset is higher than 5000 euros. Only people who buy or manufacture objects with a view to reselling them have their income taxed as explained in this detailed sheet.
In the case of carpooling, when you take individuals in your vehicle, you do not have to declare income in the case where the trip is made on your own account, that the price offered to passengers does not exceed the fuel and page costs, and that you also pay part of them.
An exemption from declaration by the platforms is provided for income from the sale of second-hand goods between individuals, as well as in the case of a non-profit service and with sharing of costs with the beneficiaries (such as carpooling), specifies the tax.
But be careful, with regard to the sale of goods, the exemption applies provided that certain activity thresholds are not exceeded. Concretely, for the exemption to apply, the user must have carried out sales operations on the platform during the entire year for an amount less than or equal to 2000 euros AND for a number of transactions less than 30 If the user has exceeded one or the other of these 2 thresholds (more than 2000 euros OR 30 transactions or more), the platform must declare the amounts in question to the tax administration, underlines the tax authorities.