Nearly 9 million households will receive an advance on reductions and tax credits as part of the establishment of withholding tax, the Minister of Action and Public Accounts, Gérald Darmanin, announced on RTL.
“This concerns 9 million tax households, therefore potentially 17 to 18 million French people, who will receive more than 5 billion – 5.5 billion euros – that the State will give them in advance of tax credit for on average 628 euros each. “
This advance corresponds to 60% of the total amount of reductions and tax credits that households can benefit from for their expenses incurred in 2018 and declared in spring 2019.
Regularization in summer
The reductions and tax credits concerned are mainly those relating to donations, the employment of an employee at home, childcare expenses or even accommodation costs in accommodation for the elderly. dependent (Ehpad). It is “A cash advance for them”, said Darmanin.
Regularization will then take place in the summer, taking into account the tax declaration that households will complete in the spring, either to pay the balance of tax credit due or to recover the overpayment in January.
As part of the introduction of the withholding tax, the government has decided to set up this advance system so that households do not find themselves in financial embarrassment until their rights are calculated in the middle of the year , while they have to pay their taxes progressively from January.
In addition, the Minister of Action and Public Accounts said that France had recorded, in 2019, a lower government budget deficit than expected, at nearly 93 billion euros, against 97.8 billion expected. This is due to better than expected tax revenues and a debt burden relieved by low interest rates. The public deficit, however, amounted to 3.1% of gross domestic product (GDP).
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