what brackets of the scale apply to your income?

From Thursday, the online income declaration service will be online. On this occasion, discover how the income tax calculation and the bracket system work.

But how the hell is income tax (IR) calculated? The question then arises that you must complete your income tax return as every year. The online declaration service will open this Thursday, April 11 until June 6 at the latest for residents of departments 55 and beyond.

Find out your net taxable income

The first step is to know your net taxable income. You obtain it from the sum of salaries, profits declared for self-employed persons, property and capital income, or even pensions received last year, in 2023 in this case. Then, from these earnings, you must subtract, depending on your situation, certain deductible expenses such as alimony or even retirement savings.

Income from your professional activity benefits from a specific reduction. To take into account expenses necessary for your professional activity – such as mileage costs – the tax administration only retains part of your wages and salaries in the taxable base. It applies a 10% reduction by default or, if this is more favorable to you, you can replace this automatic reduction with the actual costs system.

Income tax: from 0% to 45%… how many French people pay the same rate as you?

The following operation consists of dividing your net taxable income by the number of family quotient shares. To fully understand the procedure, here is two simple examples:

• A single with net taxable income of 32,000 euros. In his case, his family quotient is on the one hand. He must therefore carry out the operation 32000euros/1 = 32000euros.
• A husband couple or civil partnerships, and their two minor children, with a net taxable income of 55,950 euros. Here, the couple has 3 shares (2 shares for the couple and half a share for each child). All he needs to do is divide 55950 euros by 3 = 18650 euros.

Application of the progressive bar

It remains then to apply the progressive scale of income tax. This was increased by 4.8% this year. Contrary to what many taxpayers think, the rate of a bracket does not apply uniformly to all income. Here is the current bar.

Let’s return to our examples above.

Example 1: the single person. With a net taxable income of 32,000 euros, our single person is taxed in 3 brackets. Up to 11,294 euros of income, the 0% rate applies. On the slice between 11,295 and 28,797 euros, he therefore has 17,502 euros taxed at 11%, or 1,955.22 euros. Remains 3202 euros of taxed income on the third 30% bracket, or 960.6 euros. Result: 0 + 1837.11 + 1356.6 = 2915.82 euros. Thanks to the revaluation of the 4.8% brackets, if the single person’s income has not increased between 2022 and 2023, they will pay less taxes than last year when they had to pay 3193.71 euros.

Example 2: the husband couple with 2 children. For the couple with two minor children, with a net taxable income of 55,950 euros, the scale applied to the result obtained during step 1 is 18,650 euros. The income bracket up to 11,294 euros is taxed 0%. The remaining 10,147 euros are subject to tranche number 2 at 11%, i.e. an intermediate amount of 809.16 euros.

For this 2nd example, there is one last operation to do: multiply the result obtained by the number of shares of the family quotient. In the case of our single person, he will pay 2915.82 euros in taxes. For the couple with two children, you must multiply 809.16 euros by the 3 parts of the family quotient, i.e. a total of 2427.48 euros tax pay (excluding discount, read below).