News on revenue declarations for 2023

The tax returns must be subscribed as every year, the deadlines for filing declarations with the tax department are as follows:

• For “paper” deposits (only in certain exceptional cases):
  • Tuesday May 21^st 2024 at midnight.
• For taxpayers who submit their 2023 tax return in 2024 on the impots.gouv.fr website, the deadline is set depending on the department of residence:
  • Thursday May 23^th 2024 for departments n° 01 to 19, as well as for non-residents;
  • Thursday May 30th 2024 for departments n° 20 to 54;
  • Thursday June 6^th 2023 for departments n° 55 to 974 / 976 as well as for declarations transmitted by EDI.

The main news concerning the declarations 2042, 2042 C PRO, 2042 RICI and 2044 are shown below.

You can, at the same time, refer to these four articles, published in previous years on our website:

• Main categories of revenues to be declared on annual forms n° 2042 C, 2042 RICI and 2042 C-PRO

• List of the main French annual income tax declaration forms

• Finance act for 2024 – Main provisions concerning Personal taxation

• Finance act for 2024 – Main provisions concerning companies

I – News concerning all income statements

 1 – Online declaration

Taxpayers must complete their tax return online on the website impots.gouv.fr (or in EDI-IR mode through a third party such as a chartered accountant), regardless of their reference tax income.

Taxpayers can, however, exempt themselves from this online declaration obligation if they are unable to do so or if they reside in an area in which no mobile service is available.

Clarification: From 2024, a new service allows you to subscribe to the tax declaration on the impots.gouv mobile application (click on the link to download the app). This declaration on smartphone or tablet is however limited to simple tax situations and, in particular, to taxpayers who have not experienced any change in their family or tax situation during the year.

2 – Pre-filled information on the online declaration

The 2023 income already known to the administration (salaries for example) appears on the declaration, other information is subject to automatic carryover from one year to the next (marital status of dependents, details actual costs, childcare costs for young children, certain information relating to property income, etc.).

The online declaration can be corrected as many times as necessary before the declaration filing deadline.

Furthermore, if after receiving their tax notice, an error is noticed by taxpayers, they can access an online correction service “Correct my online declaration for 2023”, from their “Individual space”.

Remarks:

• Overtime hours and exempt monetized RTT days are also pre-filled in box 1 GH or 1 HH. On the other hand, the exempt value sharing premium is not pre-filled.
• Information relating to the professional income of non-employees should also be pre-displayed, as part of the merger of the social and tax declarations of the self-employed.
• The withholding tax deducted by the employer or pension fund is displayed on the online declaration (as well as on the pre-filled paper declaration). The amount of withholding tax can be modified when declaring online, at the level of each employer or pension fund. A missing employer or pension fund can also be added.

3 – Declaration of real estate

This is a simple reminder about a declaration different from those concerned by this article.

As we announced last year, all owners must indicate to the tax administration, before July 1^st in what capacity they occupy each of the premises they own (main or secondary residence) and, when they do not occupy it themselves, the identity of the occupants.

From 2024, the declaration must only be made (for occupancy on January 1^st 2024) in the event of a change since the previous declaration. The administration has set up a declaration interface in “Gérer mes biens immobiliers” on the impots.gouv.fr website.

II – Update concerning 2042 and 2042 C forms

1 – Wages (2042 form)

• kilometer scale: the mileage scale applicable to the 2023 income declaration is unchanged compared to last year.

  Volunteers from associations who have expressly waived the right to be reimbursed for vehicle costs can assess their costs at a flat rate according to the mileage scale, subject to providing proof, to the association, of the reality and number of kilometers traveled.

  If the taxpayer opts for the actual costs but the standard deduction of 10% is more favorable to him, the latter will be automatically applied by the administration.

• Exemption from tips: tips received in 2023 (and in 2024) by employees in contact with customers, and whose remuneration for the months concerned does not exceed 1.6 times the monthly minimum wage, are exempt from tax on Income.

• Value sharing bonus (PPV): the exemption limit increases from €3,000 to €6,000 if the bonus is paid within the framework of an incentive agreement or a participation agreement when the participation is not obligatory. A check mark appears in the declaration for the case where the threshold for exemption from the value sharing premium is increased.

• Adjustments to the transport cost exemption ceilings: exemption from the advantage resulting from the optional payment by the employer of fuel costs, similar costs and the price of public transport subscription tickets exceeding the mandatory support is extended until December 31^st 2024.

• Allowances covering teleworking costs: the income tax exemption for allowances paid by the employer covering teleworking costs is maintained for 2023. These costs may take the form of allowances, lump sum reimbursements or reimbursements of real costs. They are exempt from income tax, up to €2.60 per day and €57.20 per month.

  When employees choose to deduct actual costs from their salary, costs related to teleworking from home can be deducted at a flat rate as indicated above. Employees retain the possibility of deducting these expenses for their exact amount, particularly if this is more favorable to them, provided they can justify them.

2 – Income from securities and movable capital

• PFU of 12.8% by default or option for progressive income tax scale:
  [Reminder] Income from movable capital received is in principle automatically subject to the single flat-rate levy (PFU) of 12.8% (7.5% in certain cases). The deduction made at source by the paying institution as a deposit on the final tax is in principle pre-filled in box 2 CK of the 2042 declaration.

  The taxpayer can irrevocably opt to submit this income to the progressive IR scale. The taxpayer who intends to exercise this option must check box 2 OP of the 2042 declaration.

• Imputation of capital losses from “minibons”: the possibility of issuing “minibons” that can be exchanged on crowdfunding internet platforms has been removed for “minibons” subscribed after November 10^th 2023.

3 – Gains from the sale of transferable securities and corporate rights

• Capital gains from the sale of digital assets: Gains from the sale of digital assets made by individuals domiciled for tax purposes in France, as part of the management of their private assets, are subject to taxation at 12.8% increased by social security contributions.

  By way of derogation, gains made since January 1^st 2023 may be subject to the progressive IR scale, upon express and irrevocable option of the taxpayer. This global option must be exercised by checking box 3 CN.

4 – Income of the self-employed (BA, BNC, BIC) 2042C form

• Profit increase, applied to companies that do not belong to an approved management organization (O.G.A.) or do not use the services of a professional accountant: this increase has now been removed. The income of self-employed people must now be declared in the dedicated sections, without distinction depending on their situation with regard to approved management organizations or their use of an approved visor.

• Furnished rental of part of the main residence and guest rooms: the tax exemption measure, under certain conditions, for income from furnished rental or subletting of part of the main residence has been extended until December 31^st 2026.

  For 2023, the average annual rent ceilings per square meter admitted by the tax administration is set at €199 in Île-de-France and €147 in other regions.

• Furnished tourist rentals: the main tax developments concerning this category of income were presented in the article entitled Non-professional furnished rental since the Finance act for 2024 published on our website.

  However, we provide the following clarifications:

• • Concerning the furnished tourist accommodation regime, the finance law for 2024 limited the application of the micro-BIC regime to €15,000 in annual revenue with the application of a 30% reduction.
    However, the administration admits that taxpayers can continue to apply the previous rules to 2023 income. Thus, renters of unclassified furnished accommodation can continue to benefit from the limits of €77,700 and the 50% reduction for their income for the year 2023.

• • Companies which fall under the micro-BIC regime also benefit from a new additional reduction of 21% on the turnover relating to their activity of renting premises classified as furnished tourist accommodation when the latter are not located in geographical areas characterized by a significant imbalance between supply and demand for housing (the zones targeted should be zones B2 or C as set by the decree of October 2^nd 2023 modifying the decree of August 1^st 2014).

• Daily allowances paid to certain agricultural operators: daily allowances paid under a compulsory insurance scheme against work accidents and occupational diseases to agricultural operators subject to a real tax regime are exempt up to 50% of their amount.

• Transactions for the purchase, sale and exchange of digital assets: following an update of the BOFiP database on June 28^th 2023, the tax administration confirms the application of the BIC regime to individuals exercising a profession consisting of the purchase and resale of digital assets.

  Consequently, the BNC regime (which was planned to apply from January 1^st 2023 on this type of activity) only applies to exceptional cases involving the non-professional exercise of an activity in similar conditions to those of a professional.

III – Real estate income update – N° 2044 form

The only modification concerning the property income declaration for 2023 consists of the creation of an additional line of charges (line No. 224 bis).

This line concerns taxpayers who carry out energy renovation work allowing a home to move from an energy class E, F or G to an energy class A, B, C or D (within the meaning of article L. 173- 1-1 of the construction and housing code). This system concerns energy renovation expenses which were the subject of a quote accepted from November 5^th 2022 and which are paid between January 1^st 2023 and December 31^st 2025.

Entering the expenses indicated above in this line is optional; it has the effect of increasing the limit for deducting property deficits from overall income to €21,400 (instead of €10,700).

IV – News on tax reductions and credits -N°2042 RICI

• Donations to organizations helping people in difficulty: as of the 2023 income tax, the tax reduction at the rate of 66% is extended to donations and payments made for the benefit of works or organizations of general interest contributing to equality between women and men.

• Subscription to the capital of SME, FIP or FCPI: for payments made between January 1^st and March 11^th 2023, the rate of the IR reduction is 18% (report in box 7 CI of form 2042 RICI). For amounts paid from March 12^th to December 31^st 2023, the reduction rate is increased to 25% (report in box 7 CH of form 2042 RICI).
  
  Payments made, in 2023, for the cash subscription to the capital of solidarity real estate companies carrying out an activity in the field of social or agricultural housing entitle you to the tax reduction at the rate of 25%, whatever the date of payment.

• End of devices: the following devices no longer apply for the calculation of the 2023 income tax:
  • old Besson device;
  • tax credit for students to finance their higher education.

We can of course help you to complete these declarations to the best of our ability: contact us!