According to the 2020 tax calendar, you have all of May to perfect your tax return. And even in case of omission or correction, you can still modify your declaration until next November. For this 2020 campaign, there are a few 2020 tax innovations to know in order to make your tax return under the best conditions. This is also an opportunity to verify that you were not mistaken, like last year. Nearly 7.3 million tax households made a mistake in 2019, by not checking the 2OP box. Check this same box that could have saved as much as € 50 to nearly 1.5 million tax households.
But today you are simply wondering about your amount still to be paid regarding your 2019 income (2020 tax). For what reasons ?
Confusion on the 2020 tax cut …
First clarification. You expected a significant tax cut. Many taxpayers thought that the tax cut that the media has talked about so much would be applicable to their 2019 income (see tax schedule). It is not so. The tax cut, remember, favorable to only a portion of taxpayers, with the tax cut from 14% to 11% for the first installment will only be applicable on your income in 2020 (and not those of 2019 !). So this decrease should be noted on your 2021 tax return next year!
2020 tax remaining to be paid on my 2019 income, the reasons …
At the end of declaration of your income, the tax site tells you that you have an amount to pay, from September according to a schedule communicated later. Bad news. This withholding tax in the end would not do much. It is indeed not perfect. On your wages, pensions, unemployment benefits, the tax authorities take an amount that may be less than what you really owe him. Here are the different possible reasons:
- Your 2019 income has increased : If you benefited from a salary increase last year, the tax authorities only become aware of it today thanks to your 2019 income tax return. The levy rate that was applied to you during the year past was therefore too low in terms of your income and the tax authorities claim the difference.
- Know what to compare … Remember that your non-exceptional income received in 2018 was not taxable … Does that change anything, you say? We are not going to leave in sterile controversies for several months. Many taxpayers still have not realized that their income collected in 2018 has not been taxed. Your 2018 income, not exceptional, however, was not taxable on income. This famous CIMR came to cancel everything. In fact, if you compare the taxes that you partially paid in 2019 and that you will finish paying in September 2020 and those of the previous year, that is, in 2018, you are not comparing two consecutive fiscal years. This is like comparing your tax paid in 2018 (on your 2017 income) with that of 2019 (on your 2019 income, with the source deduction). And so fatally, the probability that your income has increased in 2 years is greater than from one year to the next … And if you compare your tax paid in 2019 with that of 2018, you are making a mistake, because this is to compare your 2019 income with your 2017 income and not that of 2018 … Hence a source of confusion for many taxpayers.
- Your 2018 income had increased compared to 2017 : it’s the bad surprise. On the first part of the year – from January to July or August 2019 as the case may be – the rate of deduction applied to your salary depended on your 2017 income (the taxman not knowing your 2018 income until after your declaration in the spring 2019, for inclusion in the rate from August or September).
- The January 2020 tax credit down payment was too large. At the start of the year, the tax authorities paid you a deposit equivalent to 60% of your recurring tax credits. If however you changed your mind in 2019 regarding these tax credits, in fact, the difference is measured on your tax return.
- 2019 stock market investment income. 2019 was a euphoric year on the financial markets. Many French people end up with market capital gains for which the withholding tax does not apply. It is therefore necessary to go to the cashier in September 2020. For 2020, you can consider opting for financial products leaving capital gains without taxation (PEA, PER or life insurance),
- Land revenue 2019 for the first year or increasing? Idem, the direct debit does not automatically manage this income. It is up to the taxpayer to adjust their levy rate accordingly, or to settle the difference in September.
- Exceptional 2019 revenues ? Again, the taxman could not be informed. The difference is therefore logical. You can also opt for the quotient system in order to distribute this income over several fiscal years.
- Investment income, Flat Tax or IR? In 2019, more than 8 million tax households did not choose the right option. This year the tax authorities have done things well because you will be warned if you do not opt for the most favorable option for you. Good news !