The method of calculating income tax is opaque for many taxpayers. The information provided by the tax authorities is subject to confusion.
It’s a simple image that caused a lot of reaction: the newspaper The echoes has published an infographic to explain the different tax brackets existing in France. The diagram presents the five rates applied according to the income received. Internet users mainly commented on the third level of taxation. This concerns French people receiving between 28,798 euros and 82,341 euros net annual before taxes, or 2400 to 6800€ per month. On this tranche, it is indicated that a tax of 30% is applied. Enough to provoke numerous indignant comments… linked to confusion.
Because no, a person receiving 2400 euros net per month before taxes (28,800 euros net annually) does not pay 8640€ to the taxman every year! This would amount to 720 euros per month. Suffice to say that there would not be much left in the accounts of the people concerned. The calculation is more complex than that. However, it is nowhere explained on his tax notice. A lack of transparency which leads to distrust in the payment of tax.
For all French people, the tax is progressive according to income, according to a scale divided into five brackets, as follows:
| Slice 5 | €177,106 and more | 45% |
| Slice 4 | €82,432 to €177,106 | 41% |
| Slice 3 | €28,798 to €82,341 | 30% |
| Slice 2 | €11,295 to €28,797 | 11% |
| Tranche 1 | 0€ to 11,294€ | 0% |
To calculate the taxes you will have to pay, you must do the following (complex) formula: take your net annual income before taxes and look at which bracket it corresponds to. From there, subtract your net annual income from the lowest amount in the bracket and multiply the result by the bracket percentage, then subtract each previous level and multiply by the corresponding percentage. Finally, you have to add it all up.
You are lost ? Here is a first example: Mr. A. earns €18,000 net per year before taxes. It therefore corresponds to tranche no. 2. The calculation of his tax is as follows: (18,000 – 11,295) x 11% = €737.66. This is the amount he will pay since no tax is levied on the income from the first tranche. Ultimately, the tax that Mr. A. will have to pay will represent 4% of his net annual income.
Another example: Mr. B. earns €30,000 net per year before taxes. It therefore corresponds to tranche no. 3. The calculation of his tax is as follows: (30,000 – 28,798) x 30% = €360.60 + (28,797 – 11,295) x 11% = €1925.22, or a total of €2285.82. taxes. This represents 7.6% of its annual income.
It should be noted that these examples only apply to a single person without children and without any tax reduction. For a detailed assessment of the amount of your tax, it is preferable to carry out a simulation directly online, here. Thus, it is possible to quickly understand that the State does not take 11, 30, 41 or 45% of the income received.