Declaring 'one-off' incomes from 2018

There are some forms of income that, by their nature, are not taxed at source, and they should be declared as usual. This includes income from shares and investments (and capital gains on

shares) and bank interest, which are taxable for 2018 and not wiped out by the generalised tax credit for the so called _année blanche_ (no-tax year). This tax credit is to account for the

fact that in the past people were always taxed with a year's delay, whereas now people are taxed 'in real time' on most forms of regular income. The _année blanche_ ensures

that people are not paying double on such income in 2019 and is a one-off arrangement for the crossover year. Certain other ‘one-off incomes’ (_revenus exceptionnels_) will also be taxed for

2018 and the tax authorities say that people should identify these _revenus exceptionnels_ as part of their tax declaration. As such new boxes have been provided so these incomes can be

identified. For more detail on this, information sheets are being sent out along with the tax forms for those who have declared previously and have not opted out of receiving paper forms. If

you have not had one, they can also be found in the following French-language document at _Fiche pratique 7_, starting at page 27: TINYURL.COM/YYPNYVN9 One financial advisor working with

the expatriate community in France told _Connexion_ these kinds of income are literally ‘one-off’ amounts that you are not likely to have again, or not for a while. He gave the example of a

person who had some income last year from having managed several properties for a season for a friend who was ill. The advisor said ‘one-off’ income would not include, for example, simply a

new pension or a new stream of rent from a property that you were not renting out in previous years – the latter are simply new (not ‘one-off’) incomes and are declared in the ordinary way

as the kind of income they are. Some other examples of ‘one-off’ incomes include: EMPLOYEES: The taxable part of money paid out in compensation for being laid off A retirement bonus A

compensation payment related to moving house or changing workplace These incomes remain taxable in 2019 and should be declared in the usual box(es) in section 1 of the 2042 (added to any

other relevant work incomes declared in the same box) and also in the new boxes for one-off incomes at 1AX/1BX (only the ‘one-off’ part of the income should go in here). RETIREES: Pension

income paid as one-off sums Such income should be declared in new box(es) 1AD/1BD as well as in the usual box for the pension sums. Note that there are new boxes to be filled out by PEOPLE

WHO HAVE DECLARATIONS TO MAKE ON THE 2042C PRO (this notably relates to SELF-EMPLOYED PEOPLE AND THOSE WITH FURNISHED LETTINGS, _CHAMBRES D’HÔTES_ AND GÎTES). There is a new mechanism aimed

at avoiding people ‘taking advantage’ of the _année blanche. _People will not be taxed on such incomes for 2018 unless their income for 2018 was higher than that of the best of the previous

three years. If the 2018 income _was_ higher, then you will be taxed on it, but only on the part that exceeds the highest income of the previous three years. If however your income in 2019

is later found to be even higher than your 2018 income, you will be reimbursed for any extra tax you paid. FOR THOSE WITH SELF-EMPLOYMENT BIC INCOME: If your business activity started before

2018 and your 2018 income was the same or less than that of a previous year you should cross the new box BIA/BIB in the 2042C PRO (page 5 of the paper form). If it was higher than the

previous years, then in the same section you need to fill out new boxes 5TJ/5TV, 5UV/5SQ and 5UW/5SR to give your incomes for the last three years (these should be pre-filled already if you

are declaring online). If your income for any of the previous years (2015, 2016, 2017) corresponds to less than a full 12-month period, then you should adjust the amount _pro rata_ so that

it corresponds to a full year. If your activity started in 2018 then cross the new box 5HN/5IN Also in this section of the declaration there are new boxes 5DR/5ER to be selected by

_micro-entrepreneurs_ who used the simple _versement libératoire_ income tax system in 2017, then opted out of it in 2018, but have opted again for it for 2019. FOR THOSE WITH BNC

(NON-COMMERCIAL) SELF-EMPLOYMENT INCOME: there is a similar new section in the 2042C PRO declaration (if declaring on paper it is at page 7). Where 2018 income was the same or less than the

previous three years select new boxes BNA/BNB. If not, fill in the new boxes 5QS/5QU, 5QR/5QV, 5QT/5QW. If your activity started in 2018 select boxes 5KG/5LG. _Micro-entrepreneurs_ who used

the simple _versement libératoire_ income tax system in 2017, opted out of it in 2018 then opted again for it for 2019 should select boxes 5AE/5BE. FOR THOSE WITH INCOME FROM

NON-PROFESSIONAL FURNISHED LETTING: there is a similar new section (on page 5 of the paper form). The new boxes follow the same categories as above and are: Income same or less: LMA/LMB If

not, fill in: 5QX/5QY, 5RX/5RY, 5SU/5SY Activity started in 2018: 5DH/5EH There is also a similar section for AGRICULTURAL INCOME, which is on page 2 of the paper form. The same process

applies. Note that IF YOU RUN A COMPANY (_société_) there is also a new section on the 2042C complementary income tax form (page 1 of the paper form) to be completed relating to certain

incomes in the 2018 _année blanche_.