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Wondering what it is like to submit your taxes in France? This is how the presentation of taxes in France is compared to its tax declaration in the United States.
Note: France has the reputation of a complex fiscal system. In part, this is because there are many or different types of taxes that existed in France. For this article, we are only compared to presenting an annual tax declaration for personal income
1. Tax presentation process
There is an online platform to submit taxes in France. It is a national system led by the government, so everyone in France uses it. In fact, it is mandatory to make your statement electronically, although there are exceptions. For example, the first time he completes his tax declaration in France, if he still does not have a Fiscal number (Fiscal identification number), you probably must complete a declaration of paper taxes.
It is possible to submit taxes electronically in the United States. However, there is no national platform that allows all taxpayers to present their taxes directly to the Government. The IRS free file program is a service that allows taxpayers to submit their federal income tax statements. Under a certain income threshold, eligible taxpayers can use guided software for free through a reliable partner. Few of these partners accept foreign addresses, leaving aside Americans abroad. Above the income threshold, eligible taxpayers can still use free full forms, but they must “do the job” as a mode on the IRS website.
The IRS has recently put Directfile. Currently available only for those who live and work in 25 participating states, Americans abroad are not eligible to use this tool. Directfile comes with several other limitations regarding income, credits and deductions. Only in the United States where it is available, not all taxpayers are eligible.
2. Complexity for tax presentation
After having submitted their taxes for the first time in France, the later years are easier. This is because much information is already prepared. You are not guessing what you or respond to execute your own calculations. Few deductibles exist. When you update your family situation (single, married/PACS, children) through the portal, appropriate rates are selected for you. Of course, you must ensure all income and profits in the correct spaces, and there may be some additional forms to complete. In general, however, declarations of personal income tax in France are not partially complex.
In the United States, there is a lot of stress and anxiety when presenting taxes. American taxpayers fight annually to gather all their paperwork: income information, bank states and mortgages, medical costs, donation receipts, etc. The forms are complicated and the instructions included are not simply written. There is fear of being wrong, together with the fear of missing significant fiscal reductions, credits and exemptions. From knowing what ways you should include to calculate how much you should, everything must be discovered yourself. Fiscal compliance in the United States is onerous.
As a special bonus, the United States is one of the few countries for citizen -based taxes instead of residence. This means that even US citizens living abroad submit their annual tax statements. As you can imagine, the presentation of taxes to live and work in another country adds another layer of complexity (and cost).
3. Tax presentation costs
The tax submission process in France is free. Ok, yes, taxes cost money, but there are no costs in addition to the issue of taxes. Since the statement is relatively direct, most people do not compromise a tax preparation service to obtain help. As expected, companies used the accountants, but when it comes to personal income statements, the average French resident is starting session in the portal and doing so. They could also take advantage of one of the free tax services available.
On the other hand, tax preparation is an important business in the United States. As already mentioned, eligibility for free online software through the government is restricted. Therefore, the choice is between completing complex forms and making mathematics yourself (OMG, no thanks) or paying for software or service. Americans commonly spend hundreds of dollars annually in addition to taxes. The software that accommodates the unique situation of the presentation of taxes of expatriates often comes with a higher price. The commercial tax preparation industry is clearly working for themselves …
