Understanding French Tax: What is the Revenu Fiscal de Référence?


Essential Reading

Understanding French Tax: What is the Revenu Fiscal de Référence?

For French residents, your annual tax notice or ‘avis d’imposition’ is a crucial document that not only informs you of your income tax liabilities but serves as proof of your taxable income and ‘revenu fiscal’. But what exactly do all those different totals mean, and why is the ‘revenu fiscal de référenceso important? Here’s what you need to know.

Your Avis d’imposition

Everyone who is tax resident in France (along with some French second-home owners) will need to file an annual tax return in France, and will consequently receive an ‘avis d’imposition’ or tax notice. These are typically made available in your online tax account from late July through August and will detail your annual revenue, taxable income, and any taxes owed.

But your ‘avis d’imposition or ‘avis d’impots’ isn’t simply a tax bill – it’s also one of the most important documents you be issued in France and serves as your official proof of income. You will likely be asked for your avis d’impots during any legal, financial, or tax procedure in France, for example, renting an apartment or applying for a mortgage, applying for or renewing your carte de séjour or residency card, taking out a loan, or applying for benefits.

You should be able to access all of your avis d’impositions via your online tax account, but it’s a good idea to print out a hard copy or save each one as a pdf to your computer for your records.

What is the ‘Revenu Fiscal de Référence’ on my French tax notice?

On the first page of your avis d’imposition, you’ll see the two most important figures:

  • The ‘somme qu’il vous reste à payer’ – the amount of tax that you owe.
  • The revenu fiscal de référence– your household’s ‘reference tax income.’

So, what exactly is the revenu fiscal de référence? It’s a common mistake for expats to assume that this number refers to your household’s net taxable income (and in many cases, you may find that these two numbers are identical) – however, that’s not actually the case. Instead, the revenu fiscal de référence refers to the household’s available resources and includes both the net taxable income and other tax-exempt income and deductible charges.

Revenu fiscal de référence, revenu brut, revenu net : what’s the difference ?

Let’s take a look at how the revenu fiscal de référence is calculated. Naturally, French tax is an incredibly complex subject, and if you want to fully understand all the charges, deductions, credits, and calculations that go into assessing your tax liabilities, we recommend seeking the advice of a qualified tax advisor. However, we’re going to simplify things for the sake of understanding and focus on the total figures you may see listed on your tax notice.

There are four main totals that you may see on your avis d’impots, and they all refer to different calculations (note that depending on your professional situation and revenue sources, you may not see all of these on your tax notice, but all tax notices will have a revenu fiscal de référence)

Revenu brut global

The ‘total gross income’ refers to all of your income, profits, and gains received over the year, minus any abattements (tax-free allowances).

Revenu net global

The ‘total net income’ refers to the total gross income minus any tax-deductible ‘charges’ (expenses).

Revenu net imposable

The ‘taxable net income’ refers to the total net income minus any ‘abattements spéciaux’ (special allowances – typically, these are reserved for elderly people, disabilities, military veterans, and similar).

Revenu fiscal de référence

The ‘reference tax income’ refers to the available resources of a household and is calculated by taking the revenue net imposable (taxable net income) and adding any other sources of tax-exempt income or income subject to flat-rate tax levy (discharge levy). This includes:

  • Certain tax-exempt income, such as tips or remuneration of employees posted overseas
  • Certain income subject to a flat-rate discharge levy (for example, income from movable capital).
  • Certain deductible allowances (such as the 40% allowance on dividends)
  • Certain income-deductible expenses (such as retirement savings)
  • Taxable real estate capital gains

See the official guidelines here.

Why is the revenu fiscal de référence important?

Your French tax notice serves as your official proof of income and resources in France, and the revenu fiscal de référence, in particular, is taken into account to determine your revenue-based rights.

This is the number used to calculate whether or not your benefit from social assistance (social housing, college scholarships, etc.), whether or not you qualify for tax exemptions or reductions (such as a taxe foncière exemption), government grants (such as ma’prime renov), energy checks, CAF benefits, and many other things.

On the other end of the scale, the revenu fiscal de référence will also determine high-income earners subject to the ‘exceptional contribution on high incomes’.

Paying Your Taxes in France

Whether you are moving to France, own French property, or have business interests, assets, or investments in France—FrenchEntrée is here to help with all your tax questions. Our Essential Reading articles are designed to give you an overview of the basics, from income tax and social charges to wealth tax and property taxes. However, tax laws and rates are always subject to change, and international tax liabilities can be especially complicated, so if in doubt, we always advise discussing your personal situation with one of our recommended financial or tax advisors.

Disclaimer: This guide is provided for general information purposes only and is not intended to be a substitute for professional advice regarding any aspect of your tax planning or tax liabilities in France. FrenchEntrée cannot be held responsible for the consequences of decisions or actions you may choose to take in connection with French tax declarations or tax liabilities.

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