This is advice that households filling out their tax return right now: don't forget your tax loopholes! These can indeed save you several hundred euros, and many French forget each year to use them, says a study by the start-up Climb.
Founded in 2016 by Aldric Emié and Rodrigue Menegaux, Climb offers its users to use its algorithms to "look for the best solutions to optimize [their] personal finances". The company thus makes an enticing promise: to discover "how to make [its] money grow". A program all the more attractive in times of high inflation, when the French are tightening their belts. And, to save a few precious extra euros for the main concerned, the start-up looked at the famous "tax expenditures".
These hundreds of tax loopholes, which are complex, theoretically allow tax-paying households to benefit from reductions or even exemptions under certain conditions. However, each year, "the forgetting of tax loopholes makes each household lose up to 699 euros," Aldric Emié recently pointed out on Linkedin. It must be said that the list of devices has the air of inventory à la Prévert: tax credit delivery of meals at home, tax credit related to the employment of a person at home, tax reduction related to schoolchildren ... It's hard to find your way around.
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Through ignorance or forgetfulness, many tax benefits are not declared to taxes. Every year, it is several billion euros unclaimed by taxpayers, "regrets Climb. Among the tools frequently neglected, we find, for example, professional expenses. "To declare their professional expenses, 80%" of households benefiting from it opt for an automatic allowance granted by the tax authorities of 10%. However, they may also prefer to declare their actual expenses. A procedure certainly longer and tedious, but also more profitable, because the costs are then not capped: "This option is therefore interesting as soon as your workplace is located more than 20 kilometers from your home and you go there with your car," says the study. For the company, "20% of households with at least one taxpayer employed use this system, while we estimate that at least 22% could have an interest in doing so". They could then earn, on average, 441 euros.
School fees, donations, human services
Other measures to look at more closely include children's school fees: by not declaring their children, parents do not benefit from attractive tax reductions, the document points out. However, these shortfalls add up, reaching "more than 378 million euros" unclaimed each year, and an "overpayment" of 160 million euros for the administration. Climb also cites the case of personal services - "more than 500 million euros of expenses giving entitlement to a tax credit have not been declared by the taxpayer", or "65 euros of tax in excess" for eligible households - as well as donations to associations. In the latter case, "the sums not claimed by taxpayers would potentially represent 1.5 billion euros, or about 45 euros per tax household having forgotten to declare these donations," figures the young shoot.
To arrive at these results, Climb looked at the data shared by the IRS, looking at "the number of taxpayers filling in each box on the tax return as well as the total amounts completed." For each tax loophole, then, the organization looked at the "available market data for the year 2019", in order to compare the amounts of taxpayers - for example, the amount of donations reported - and external data - the amount of donations from individuals, indicated by the association France generosity, in this case. "By making the difference between these two amounts and multiplying it by the tax credit rate (66%), we calculated the amount not claimed by individuals," explains the company.
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For households, it is therefore better to look closely at the tax return, when filling it out. To help them, Climb has also recently published a table listing the main tax loopholes that individuals can benefit from. The stakes are high, for individuals and the State: in 2022, tax expenditures represented, in total, some 94.2 billion euros, according to the government. A massive amount, "particularly concentrated" on a handful of niches: the tax credit for the employment of an employee at home represented, alone, more than 5.7 billion euros, and tax reductions for donations 1.75 billion euros.
