The administration is launching in July 2020 an experiment in two departments, where the tax credit for home employment will be collected in real time and not with a one-year delay. A first step before the generalization of contemporary payment, by 2023 or 2024.
The road will be long until all home employers can collect their tax credit in real time, but the administration now says it is determined to carry out this reform eagerly awaited by taxpayers, with a first concrete step that will be passed in 2020. On the occasion of a review on the new platforms of Cesu and Pajemploi, the Minister of Action and Public Accounts, Gérald Darmanin, announced this Thursday an experiment with a view to avoid taxpayers advancing cash when employing a home employee.
From July 2020, this possibility will be tested in two departments, the North and Paris, for individuals with loss of autonomy or disability (eligible for the disability compensation service or the personalized autonomy allowance ). The objective is to be able to generalize this experiment to the whole of France in January 2021 for these fragile audiences. “This represents a cash effort of 900 million euros for the State. This explains why we were doing it in stages ”, explained Gérald Darmanin.
Contemporary tax credit
At present, home employers receive a tax credit equivalent to 50% of their expenses, with a lag of one year. The switch to withholding tax forced Bercy to set up a complex system of deposits, in which taxpayers receive an advance of 60% in January, then the balance in July after their income tax declaration. But some must also reimburse an overpayment, a politically sensitive subject.
Since then, the administration has been working on the possibility of paying the tax credit in a contemporary manner, that is to say that the individual would only pay the remainder after deduction of state aid. Its work has so far encountered technical and budgetary obstacles. The contemporary payment implies, at the time of the transition, a “double year” for this tax credit which now weighs 4.8 billion euros on the state budget.
Early childhood sphere
The Minister confirmed that the intention is to generalize this contemporary payment to all home employers, considering that the next sphere concerned could be that of early childhood. “We want to make this generalization for all employers as quickly as possible, by 2023 or 2024. It is a complex project that requires a budgetary effort”, he recalled. He assured that the methods of calculating aid would not change during this transition.
Despite this very gradual increase in load, Fepem, which represents individual employers, was delighted with this announcement. “Many more modest families hesitate to return to work at home because of this cash flow mismatch”, notes its president, Marie-Béatrice Levaux.