Withholding Taxes

The withholding taxes in France are the taxes on revenues of French workers and is put in place from the 1st of January onward. These set of laws are also concerning foreign companies that post their workers in France. By doing that, they also have the same obligations on taxes on revenue but maintain their affiliation concerning the social security contributions in their home country.

 By consequence, the foreign employers will have to calculate and withhold the taxes on the pay check of their employees and pay the taxes on revenues to the French government.

 

What is the procedure to be followed when you are a foreign company?

  • Register your company to the tax office responsible, which is the “SIE des non-résidents” in Noisy le Grand in order to obtain a SIRET number (in the case you don’t already have registered for VAT in France)
  • Calculate the amount of taxes to be withheld, using the right rate for each employee. Remark: the rate of taxes is calculated and communicated to the employer on a monthly basis by the French tax authorities
  • Withhold this amount on the pay check of the employee concerned
  • File this via the PASRAU (Prélèvement à la source pour les Revenus Autres) procedure in France
  • Pay the withheld tax to the French tax authorities

 

Please keep in mind that companies established outside the European Union must have a fiscal representative in France, certified by the French tax authorities. The fiscal representative has the obligation the fulfil all formalities regarding the withholding taxes and to guarantee that the calculated amounts will be paid.

 

The companies that already have a fiscal representative for their VAT filings will be obliged to work with the same fiscal representative for the withholding tax, it is prohibited to have to fiscal representatives.

 

If your company is eligible for withholding tax regarding your employees, please don’t hesitate to contact our team to receive more information on this matter. We’ll be happy to help!

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