SETTLING IN - CultureShock! A Survival Guide to Customs and Etiquette - page 150

may still be more expensive, owing to high import duties
and taxes. Yet even the prices of these items are quickly
becoming more competitive, especially with the advent of
the hypermarchés .
French Taxes
Residents with income in France are liable for taxes on
income from sources worldwide. This includes salaries
and investments but not foreign real estate income. Non-
residents are taxed only on earned income in France
(salary and rental income) and non-resident foreigners
with vacation homes in France are generally not subject to
income taxes. Some countries have multilateral treaties with
France by which citizens working abroad are not double-
taxed. You must still file your tax return on time. Find out
the deadline for people living abroad.
The French tax year coincides with the calendar year. Tax
filing for salaried employees and independent contractors is
due by the end of May. Taxes are based on le revenu (earned
income) and capitaux mobiliers (unearned income). Taxes
can reach up to 40% of gross income (but are set to go
down at least somewhat), and there are also other forms
of tax: capital gains tax, death duties, gift tax, wealth tax
and land tax, etc.
There are some rebates, exemptions and a standard
deduction for married people and those with children.
French employers do not withhold any amount for tax.
After the tax return ( déclaration de revenus ) is filed, the
government calculates the tax due and sends a bill. After
the first year in the tax system, the bill may be paid in three
installments or debited monthly from a chequeing account.
First-time taxpayers must declare themselves and their
taxable income to the appropriate Centre des Impôts.
Taxes at Home
Everyone must determine their tax status at home and in
France while living abroad.
EU countries have treaties by which there is no
double taxation, but since French taxation is based on