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How to understand your French payslip

How to understand your French payslip
Photo: AFP
If you're an employee in France you will receive a monthly payslip and the first thing you will notice is that it's very long and complicated. Here's how to understand what happens to your monthly salary.

At first glance your take-home pay may seem quite generous, but as you go through your payslip you will notice quite a lot of deductions being taken off.

Of course it's not news that you will pay quite a lot of tax in France – in fact a 2019 Eurostat reported showed that France is the most taxed country in Europe.

Hopefully the high quality of the public services such as healthcare and public transport will soften the blow somewhat, but here is a quick guide to what is what on your payslip.

 

1. Personal details

At the top are the personal details for you and for your company.

This includes your name and address, plus the name, address and SIRET number of your company.

READ ALSO What is a SIRET number and why is it crucial?

It also includes your social security number – the same number found on your carte vitale – and how many hours per month you are contracted to work (heures).

Also included is your job title and the category you fall into – worker, middle, manager, senior manager etc. This are important because they can affect some of the perks and benefits you are entitled to. There is also the coefficient du contrat de travail followed by a number, which also details what type of employee you are and your seniority level.

The date début d'anciennetè is the date you started at the company. 

Finally there is the date that the payslip covers.

Payslips in France are used for more than simply confirming your salary, they are a way of proving your income and you may be asked to supply your last three months' payslips (bulletin de paie or fiche de paie) for several events such as renting a new home or applying for a visa or residency permit, so it's important that you have a complete set of payslips.

Your company should send them to you, either by post or email, but if not you should chase them up as these documents could be very useful to you.

2. Gross income

Your payslip will show your total brut – gross salary – at the top. But before you get too excited look down to the net a payer – net pay – amount at the bottom. This is the amount that will actually show up in your bank account and it's usually quite a bit less than the gross total.

The numbers in between those are the deductions taken off, and they're spelled out in quite a lot of detail. Whereas UK payslips tend to just lump it all together into 'tax and national insurance' the French ones detail how much you're paying towards healthcare, unemployment insurance etc.

First will be any extra payments above your salarie de bas – basic salary. These could include any bonuses, extra payments or extra money for the 13th month (although this is becoming less common).

3 Deductions

Next come the deductions and these are broken down into two sections the charge – which is social security deductions – and the impot sur le revenu which is income tax.

The idea of tax being deducted from your salary at source is relatively new in France, coming in in January 2019.

Before that workers still had the social charge deducted – the equivalent of National Insurance in the UK – but filed a personal tax return to pay income tax.

These deductions will usually be listed in columns that show the base rate (base) the rate (taux) and what is deducted (a déduire) and what will be paid (a payer).

The charge includes santé (health) retraite (your pension) securité sociale (social security), famille (family) and assurance chomage (unemployment insurance). Once you have been paying in to the assurance chomage scheme for six months you are entitled to claim benefits in France if you lose your job.

The list of deductions (cotisations et contributions) used to be much longer until the government simplified things in 2018.

On the right hand side there is the charges patronales or part employeur – and that's the payroll taxes or contributions that your employers makes to your pension, healthcare etc. 

Anyone thinking of starting their own business should note that these charges can be quite high, which makes employing people in France an expensive business.

READ ALSO How unemployment benefits in France work

4. Income tax

Your payslip then has your total before income tax – net a payer avant impot sur le revenu – and your total after tax – net a payer.

At present the pre-income tax total is in larger type than the actual amount of take-home pay, which seems rather counterintuitive. The reason for this is the relatively recent change of taxing people at source. The heavy type pre-tax total was added to payslips to avoid 'psychological distress' of workers when they opened their payslips under the new scheme and saw a smaller total.

Under the taxing at source arrangement people pay exactly the same amount of tax, it's just taken out of their payslips every month rather than being paid to them and then them paying a tax bill every year.

5. Extra perks

At the bottom is a box with some extra information which can be important.

First is the 'conv coll' or convention collective. This is useful to know because many of the perks that some French workers enjoy – such as meal vouchers, transport subsidies and extra days off – are bargained for under conventions collective, which are usually industry wide.

So if for example you are a journalist, you will be part of the convention collective journalistes and armed with that knowledge you can go and see what perks have been negotiated for you (not as many as those enjoyed by rail workers, sadly).

READ ALSO These are the days off work you are entitled to in France

Also at the bottom of the payslip is your congés – which the days of annual leave you are entitled to, and how many you have taken so far.

Important

Many employees assume that because they are getting their income taxed at source, they don't have to fill in a tax return, but that is not the case.

Tax returns are compulsory for everyone who is a resident in France – whether they are employed, self-employed, retired or not working.

If your only income is your salary and it's already been taxed at source your tax bill is likely to be very low – or even zero – but you still have to fill in a return.

French authorities say they are looking to scrap the annual declaration for some people in the future, but at the moment it is still compulsory.

And in certain circumstances you could actually end up getting money back – tax credits are available for people with children and on certain costs.

READ ALSO The perks and prizes for French parents with lot of kids

Worth mentioning too that you have to tell the French taxman about all your income – regardless of where it comes from.

So if for example you work in France and receive income from a property rental in the UK or US, you need to declare this.

Double taxation agreements mean that you wont be taxed twice on the same income, but you do still have to declare it. Likewise all foreign bank accounts – even if they are dormant – need to be declared.

READ ALSO What do I need to tell the French taxman about?

 

 

 

 


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