TAX CREDIT. From January 15, the tax authorities will pay the 2021 tax credit deposit for households eligible for regular tax benefits, such as childcare (crèche).
[Mis à jour le 14 janvier 2021 à 14h07] Are you one of those 8.5 million tax households who will have a pleasant surprise reading their bank statement this Friday? The tax administration will proceed with the installments of 60% of recurring tax credits on January 15, under the wording “ADVANCE CREDIMPOT” – or by letter-check at the end of the month in the absence of bank details. The average amount of this advance is 640 euros, Bercy said in a statement released earlier this week. Don’t understand if you are eligible? Do not panic.
Since the implementation of withholding tax to 1is January 2019, some tax households receive in mid-January each year a tax credit advance. Not all tax advantages give rise to the payment of a deposit. The tax administration has established a very precise list, which you can consult on the tax website, here are a few examples: employment of an employee at home, care costs for young children under six, union dues and dependency costs. To calculate the exact amount of this advance, the tax authorities took an interest in the latest information you provided. She therefore calculated the advance based on the expenses you mentioned in your last tax return (the one completed in spring 2020), “unless the taxpayer has intervened to reduce this amount in ‘Manage my deduction at source’ on impots.gouv.fr between September and December 2020”, recalls Bercy.
You usually have to wait until the summer, once the tax authorities have studied your tax return – the one you will complete in spring 2021 -, to determine if it owes you the remainder of the tax credit. This time, the amount will therefore be calculated according to the sums committed in 2020 and actually eligible. Several situations may then arise:
- Say you hire a nanny to babysit your children, your expenses increased between 2019 and 2020: you will receive a deposit remaining higher than expected in the summer.
- If your expenses have gone down, because you no longer used a nanny for your children in 2020: you will have to reimburse the tax authorities in the fall of 2021.
- Your expenses are stable between 2019 and 2020 : you will receive the remaining 40% this summer 2021.
In 2020, you had until December 10 to adjust your tax credit deposit for January 2021. See our article dedicated to the tax credit to find out more. This same mechanism is intended to be repeated every year.
Declaration, advance, reimbursement … Do you still find it difficult to see clearly despite the withholding tax? Here are the main deadlines to remember for the tax credit for the coming year:
- January 15, 2021: this is the date on which certain tax households will receive a tax credit advance by bank transfer. This deposit relates exclusively to expenses considered recurring such as home employment for example. This advance will be calculated based on the amount of expenses that you mentioned in your last tax return, in spring 2020, for the year 2019.
- Spring 2021: This is the moment when you will have to complete your 2021 income tax return, covering 2020 income. You will mention your expenses eligible for one or more tax credits made last year.
- Summer 2021 : the tax authorities determine your actual expenses and determine whether you owe a tax credit payment, and if necessary proceed to a reimbursement. If your expenses qualify for a tax credit, you run the risk of having to reimburse the tax authorities in the fall of the advance that was paid to you in mid-January.
- December 2021 : as last December, you should have the opportunity to modulate, or even eliminate, a possible tax credit advance, if you already know that your expenses eligible for a tax credit have decreased in 2021 , compared to 2020.
- Mid-January 2022 : date of payment of the recurring tax credit deposit, calculated on the basis of the last tax return, if you have not made any changes.
There was indeed a tax credit intended to encourage the French to undertake energy renovation work. On January 1, 2021, the tax credit for the energy transition, which notably made it possible to finance the installation of new windows or even a boiler or a pellet stove was officially abolished. Strictly speaking, there is therefore no longer a tax credit. Since January 1, 2020, it has been replaced by a new aid scheme, paid as soon as the work is finished, called Ma Prime Rénov ‘.
Since January 1, 2021, the latter concerns all households, regardless of their income. In total, four income categories were created, giving rise to four different bonuses. The amount of aid thus depends both on the nature of the work and on the household’s level of resources. Would you like to know more about the new Ma Prime Rénov ‘system? Read our dedicated article:
Do you have your child looked after by a nursery assistant or in a crèche, daycare center or daycare center? If your child is under 6 years of age on January 1 of the tax year and is actually dependent on you, you are eligible for a tax benefit. The tax credit corresponds to 50% of the sums involved, up to a limit of 2,300 euros per child (1150 euros in alternating custody). The maximum amount of the tax benefit is therefore € 1,150. This tax credit is also considered recurring and gives rise to an advance at the start of the year. The declaration is made in box 7GA to 7GG of form n ° 2042 RICI.
The tax credit for the employment of an employee at home allows the payment of 50% of expenses incurred during the year, up to a limit of 12,000 euros per year. This ceiling is increased by 1,500 euros depending on the family situation. It is increased to 15,000 euros for the first year in which you directly employ an employee at home (18,000 euros depending on the family situation). If one of the members of the tax household is disabled, the ceiling is raised to 20,000 euros. What expenses are eligible for this tax benefit? There are many, here are a few examples:
- Child care
- Domestic services
- Collection and delivery of ironed linen
- Assistance to the elderly and disabled
- Small gardening work and small DIY services.
Keep in mind that the coverage limit is reduced for certain expenses. This is the case of small DIY – the intervention of which must not exceed 2 hours – (500 euros), IT assistance (3,000 euros) and minor gardening work (5,000 euros). The home employment tax credit, being considered recurring by the administration, gives rise to the payment of a deposit each year in mid-January.
The executive wants to ensure that this tax advantage becomes contemporary, as if it were also subject to withholding tax. Clearly, his payment would take place in “real time” every month. This device will not see the light of day immediately. An experiment was to see the light of day at 1is July 2020, but was postponed to September due to the health crisis, in two departments (the North and in Paris). It only concerns people who benefit from the disability compensation benefit and personalized assistance for autonomy (APA).
A noter : the declaration is made in part 7 of form n ° 2042K – the classic income tax return and not the 2042 RICI form – in box 7DB to 7DG.
Some work may give you a tax credit. This is the installation and replacement of certain equipment specially designed for the elderly or disabled. Expenses incurred for sanitary, safety or accessibility equipment can be reimbursed to you, up to 25%, up to a limit of 5,000 euros for a single person, 10,000 euros for a couple subject to common taxation, then 400 euros additional per dependent. For this device also, refer to form n ° 2042 RICI, in boxes 7WJ and 7WL.
Whatever tax credit you claim, you must declare it. Clearly, you must indicate to the tax authorities the amount of expenses eligible for one or more tax advantages. This procedure takes place at the same time as the income tax return. You must indicate the amounts of expenses incurred declaration n ° 2042 RICI in particular. This document is available in your public finance center, or on the official tax website, here, and must be attached to form n ° 2042 of your income tax return. Keep in mind that you must keep all supporting documents for expenses paid. The tax authorities are indeed likely to ask you for them.