Millions of people are set to receive a refund from tax services either today (July 24) or next week on July 31.
The reimbursements are either related to French tax overpayments they made in 2023, or relate to tax credits on estimated relevant 2024 expenses, which were partially paid out at the beginning of the year.
The exact refund amount due will vary but the average payment is reported to be around €840 per person.
The refunds are calculated using information contained in tax declarations made this year (for 2023 income).
The Direction générale des finances publiques (DGFiP) has now made final calculations and worked out who overpaid tax in 2023. It is this extra paid tax that is being refunded.
In addition, those who received payment in advance relating to tax credits/reductions in January 2024 (based on 2022 income and usage levels) – and who declared similar expenses in 2023 in their tax return this spring – will see the remaining balance paid.
The payment in January was an advance payment for credits relating to 2023 expenses, calculated based on credits you had in the previous year.
Those set to receive refunds should have received an email from the tax authorities informing them of this.
However, be aware that scams concerning tax refunds are common at this time of year, and note that emails from the authorities will only inform you of your refund, and will not ask you to enter any details or click on any exterior links.
You can also check your personal space on the French tax site on your avis de situation déclarative à l'impôt 2024 sur les revenus 2023, if you are unsure.
You can read more about receiving the refund, including how it will appear on your bank statement, in the article below.
Read more: Key tax dates for individuals in France in July 2024 explained
Why does this happen?
Income tax is levied via a mixed system in France, partly 'at source' during a given year or 'on account' as often it cannot be literally taken 'at source' (on, for example, a foreign pension). A regularisation process then takes place after an annual declaration which takes into account the actual income / family situation.
The annual declaration is also used to alter your 'at source' or 'on account' rates moving forward. For example, the tax declaration you made in spring 2023 (for 2022 income) was used to calculate the tax collected from you in the following months.
For those who saw their financial situation change during a tax year - such as experiencing a fall in income or a decrease in expenses giving rise to tax credits (eg expenses for childcare or fuel for work) - any tax and tax credits due for that year may need to be adjusted.
These are then recalculated after the relevant annual declaration is made (in this example, in spring 2024), with any excess in tax-at-source tax paid over the previous year being refunded as a one-off payment.
It is important to make sure the tax authorities have your correct banking information so they are able to refund you.
Read more: How to check the French tax authorities have your up to date bank information
In addition, this is also the time when a last round of tax credit payments are made for the previous year.
60% of annual tax credits are paid in January of each year (in January 2024, they were paid based on information contained in your 2023 tax return, which itself was based on 2022 income).
Once you have made your declaration for 2023 income (made in spring 2024), authorities check you continued to have expenses relevant to the tax credits paid.
These can include payments for services such as childcare, nannies, gardeners, cleaners etc.
If you are eligible, a second balancing payment is made in July, on one of the same two dates as for tax refunds.
The information from your tax return will also be used to predict if you are likely to continue to be eligible for these tax credits in 2024 (although this information will not be fully known until you make your tax declaration for 2024).
This cycle will continue, with a 60% payment being made in January 2025, based on the information given in your 2024 tax declaration.
Process can also lead to more tax needing to be paid
However, as well as refunds being due the reverse can also happen.
If your your income increased significantly in 2023 you may need to pay extra tax.
When submitting your tax declaration, you will already have been given an estimate of this.
This will subsequently be confirmed in the avis d'impôt statement you receive in July or August (the date is dependent upon whether you receive a digital or paper copy).
If you owe less than €300, this will be collected in one payment in September 2024. For higher amounts it will be spread over four payments, collected September 2024 – December 2024.
Collection assumes the tax authorities have your bank information, if so they will organise the payments for you as a direct debit.
However, if they do not have this information you will need to make the payment manually. For payments of under €300, this can be done online via your personal space on the tax site or using the impots.gouv app, in certain tabacs and other stores, or via cheque.
Payments of €300 or more must be made online or via the app (or you can provide your bank details and allow the authorities to organise the payments).
In the same way, if you stopped making payments giving rise to tax credits in 2023 but were still paid a 60% advance in January 2024, you will need to pay back any excess amount that you received.
Note that it is possible in the course of a given tax year, to notify the authorities of significant rises or drops in your expected income for the year, as well as to modify or cancel the amount of tax credit instalments that will otherwise be paid out in January in the case of your no longer having the relevant expenses (eg. if you stop using a childminder or gardener).
This is done via the Gérer mon prélèvement à la source section of your personal space at impots.gouv.fr and can avoid you having large sums to pay back in the year after the income is declared.
