Newsletter September 2023

Your income tax notices are available

Your 2023 tax notices based on 2022 income are now available in your online space impots.gouv.fr

It will therefore be possible to correct any errors in your declarations until December 6, 2023.

By making a correction, your income tax will be recalculated and a new tax notice will be sent to you.

The Value Added Tax “CVAE” abolition postponed to 2027

The CVAE is a local tax payable by businesses with annual sales up to €500,000.  The total abolition of this tax had been announced for 2024, but the Minister of the Economy, Bruno Le Maire, finally announced that the deletion would be staggered over a longer period, with total abolition by the end of 2027.

Increase in council tax (Taxe d’Habitation) on second homes

Although the Taxe d’habitation has been definitively abolished for primary residences, owners of second homes are still required to pay it, and may well see their local taxes increase still further… A new decree published on August 26 gives certain communes the option of increasing this tax in order to combat the shortage of housing on their territory. This increase is not new, but until now it was reserved for urban areas with a population of over 50,000. From now on, the list of communes eligible to apply this increase has been extended to include 2,200 small tourist communes, mainly located in the mountains, the Côte d’Azur, Corsica, the South-West and Brittany. From 2024 onwards, these communes will be able to increase their Taxe d’habitation by between 5% and 60%.  

Pension reform: “Progressive retirement” open to all

Previously reserved for employees in the private sector and a limited number of self-employed professionals, the pension reform which came into force on September 1^er 2023 now opens up the possibility of benefiting from the “Progressive Retirement” scheme to all working people. 

How does it work? This scheme enables people nearing the end of their career to reduce their working hours, while continuing to make pension contributions. The reduction in remuneration resulting from the switch to part-time work will be offset by the receipt of a portion of their retirement pension. 

What are the qualifying conditions? It is available for the last two years of your career before reaching legal retirement age. Those wishing to take advantage of the scheme must have contributed for at least 150 quarters of their career. Partial activity must represent between 40% and 80% of a full-time equivalent.

Employees wishing to take advantage of this arrangement must send a request by registered letter to their employer. The employer is entitled to refuse, but must justify his decision by providing evidence that part-time work is incompatible with the employee’s job.

For the self-employed, the process is more complex, since to benefit from the scheme, applicants must be able to demonstrate a drop in income of at least 20% compared with the previous year (N-2).

Mutually agreed termination of labor contract: increase in social security constributions from September 1st

From now on, mutually agreed termination (rupture conventionnelle) will cost employers more, as the rate of the “forfait social” (social security contribution) applied to the employee’s severance pay will rise from 20% to 30% from September 1st 2023.