In terms of income tax, the discount system, often unknown to the general public, makes it possible to greatly reduce the entry into tax of households with the lowest incomes. The discount even cancels the tax when it does not exceed a certain amount: around €570 this year for a single person and just under €950 for a couple. It is in particular this discount system that explains why less than one in two households pays income tax in France.
Discount calculation
For several years, the discount has consisted of reducing the tax resulting from the application of the progressive scale of the difference between a certain ceiling (€833 this year) and 45.25% of its amount for single, divorced or widowed persons. For a couple, the deduction will correspond this year to the difference between €1,378 and 45.25% of the amount of tax theoretically due.
In the example of a single person whose gross tax this year amounts to €1,000, the discount is €833 – (0.4525 x €1,000), or €380.5. On arrival his tax will be reduced to an amount of 619.5 €. For a married couple whose gross tax reaches €2,000, the discount will be €473, reducing the tax to €1,527.
Up to what salary level?
For income received in 2022 which will be declared in the spring, the discount will apply as long as the tax resulting from the scale is less than €1,839 for a single, divorced or widowed person and less than €3,044 for taxpayers subject to taxation. common.
To better situate these figures, according to our calculations, single people benefit from the discount up to around €30,500 in annual income, or around €2,540 per month. For couples, it can be two salaries up to around €2,700 and €1,800 per month respectively. These examples are of course aimed at people with no other income than that of their salaried activity or their retirement.
Cases where the discount cancels the tax
For smaller amounts of tax, the discount will completely cancel the taxation, as it results from the progressive scale. This is the case when it is less than around €573 for single, divorced or widowed taxpayers. Also according to our calculations, this corresponds to people with a monthly salary or pension not exceeding €1,480.
For taxpayers subject to joint taxation, this limit from which the discount cancels the tax is around €948 this year and is aimed at couples with incomes not exceeding in total just under €2,800. . This can correspond to a household where the husband earns the minimum wage and his wife earns around €1,440 net per month.
Simulations
The 2023 tax simulator already allows you to quickly calculate the amount of your income tax by selecting the simplified model. Line ” Simple rights » corresponds to the gross tax before discount and the possible amount of the discount appears just below. If you do not benefit from any discount, the simple rights and the tax (before tax credit) will show the same amount.
to know
Income tax is never collected when its amount is less than €61.