Tax cuts and credit: new features of the 2022 financial law

(Photo: Pexels - Lukas)

(Photo: Pexels – Lukas)

The taxpayer can reduce his account with the tax authorities either through the mechanism of tax exemption by investment deduction (financial tax is deducted from taxable income), or by tax exemption by reducing the tax paid, which corresponds to a direct reduction in the amount. due tax. In this case, there are two scenarios: a simple tax deduction calculated on a progressive scale, non-refundable, if the amount of the tax deduction exceeds the tax amount, and a tax credit that reimburses the surplus (or all) by the General Directorate of Public Finance if tax credit exceeds the amount of tax. Learn in this article all the new features of the 2022 Finance Act that need to be used to take into account the proper filing of tax returns on reductions and tax credits.

Reduction of the tax on donations to organizations of assistance to the most disadvantaged increased to 75%

Donations by taxpayers to organizations that provide assistance to the poorest entitle taxpayers to a tax reduction of 66% of the amount paid. However, in 2021, as in 2022, this reduction in exceptional cases increases to 75% of donations totaling less than or equal to € 1,000 to the most deprived organizations (compared to the maximum of € 552 in 2020).

This system is in addition to the usual system of donations to organizations of general interest, which allows you to benefit from a 66% reduction in your donation within 20% of taxable income.

For example, by paying € 1,500 to the Red Cross, you can get a 75% tax reduction of € 1,000 and a 66% tax reduction of € 500. Thus, from the amount of income tax (750 + 330) can be deducted 1080 euros.

The reduction in the tax on investment in SMEs increased to 25% of the amount invested

To support the local economic structure, investments in non-listed small and medium-sized enterprises less than 7 years of age and headquartered in the European Union or the European Economic Area, under certain conditions and, in particular, the obligation to keep their shares for 5 years, entitles to a tax reduction, usually 18% of the amount invested within 50,000 euros or 100,000 euros for the couple. But this rate is approved by the European Commission to 25% for investments made between March 18, 2022 and March 31, 2022.

Thus, from March 17, 2022, the tax reduction for a person who has invested 50,000 euros in SMEs will be 12,500 euros and 25,000 euros for a couple.

Note that direct investment in SMEs is not the only option. This tax cut also applies to your investments in SMEs through crowdfunding, as well as through private equity funds such as FIP, FCPI and FCPR. However, investments in SMEs through these funds are limited to a maximum investment of € 12,000.

Extended tax credit for personal services

To encourage individuals to declare domestic staff, the individual employer benefits from a reduction in tax or tax credit equivalent to 50% of the amount paid to his employee within the threshold of € 12,000, which may, however, be increased if the household includes children. , people over 65 or disabled.

The issue of the right to certain services provided outside the home (taking children to school, such as accompanying an elderly person to a doctor’s appointment, etc.) was clarified by the Finance Act of 2022 and is now considered a tax credit right for certain individuals . services that were abolished by the State Council in 2020, in particular for services provided outside, if they are part of a set of services that includes residential activities.

Also note that you can now receive a monthly tax credit against a one-time payment with an annual lag.

Read also: Income from capital: what taxes?

Introduction of a new tax credit for the installation of an electric car charging system at home

Finally, the Finance Act of 2022 introduces a new tax cut or tax credit to encourage the transition to electric vehicles. In fact, owners of electric cars or hybrid cars connected to the connection will be able to benefit from a tax reduction corresponding to 75% of the cost of installing a charging system in their home (primary or secondary residence), up to a limit of 300 euros. .