2024 Budget Bill: What Will Change for Individuals

Every year, the budget bill sparks heated debates within the majority, which has invoked Article 49.3 on several occasions—most recently on December 19—in order to pass the final version of the bill.

What changes are in store for income tax under the 2024 Finance Act?

As is the case almost every year, the income tax brackets have been adjusted to account for inflation. Thus, the tax brackets applicable in 2024 to 2023 income are as follows:

• 0% up to 11,294 euros;
• 11% of 11,295 euros to 28,797 euros;
• 30% of 28,798 euros to 82,341 euros;
• 41% of 82,342 euros to 177,106 euros;
• 45% on amounts exceeding 177,106 euros.

In addition to the usual adjustment of the income tax brackets, the 2024 Finance Act provides for the continuation of various measures aimed at mitigating the impact of inflation on individuals. Thus, the exemption from income tax and social security contributions on tips paid by customers is extended. Similarly, the 400-euro exemption limit on fuel allowances paid by employers to employees for their commutes is being renewed.

Which tax exemption programs have been extended?

As is customary, this year’s budget bill renews certain tax incentives. These tax benefits, established to provide economic incentives or promote tax equity, have remained in place over time. Among the tax incentives renewed for 2024 is the extension of SOFICA (Companies for the Financing of the Film and Audiovisual Industry). These companies raise private funds to finance French and European film and audiovisual productions, offering a tax reduction of 36% to 48% depending on the assets in which the SOFICA invests.

With regard to donations, the Coluche program has been extended, with the cap raised to 1,000 euros, entitling donors to a 75% income tax deduction through December 31, 2026. The 2024 Finance Act also extends the tax deduction for donations to feminist organizations, raising the deduction to 66% of the donation amount. Also worth noting is the extension of the tax deduction for donations related to the funding of restoration work on religious buildings, with a 75% deduction for contributions to the Fondation du Patrimoine made between September 15, 2023, and December 32, 2025, up to a limit of 1,000 euros per contribution.

Finally, the cap on the tax credit for installing electric vehicle charging stations at the taxpayer’s residence is increasing from €300 to €500 for investments made between 2021 and 2025, but is now limited to controllable charging stations only.

What housing-related measures are included in the 2024 budget bill?

Many provisions of the 2024 Budget Act also have implications for the real estate sector. Of particular note is the elimination of the Pinel program, as well as the four-year extension of the Zero-Interest Loan (PTZ) and the Eco-PTZ loan, which are now reserved for multi-unit housing and limited to Zones A and B1 for new construction, and to Zones B2 and C for existing housing. The 2024 Budget Act also formalizes changes to the MaPrimeRénov’ program, which now focuses more on replacing heating systems and comprehensive renovation projects that result in at least a two-class improvement in the Energy Performance Certificate (DPE).

With regard to the taxation of seasonal rentals, the 2024 Finance Act provides for a specific tightening of the rules, applicable to owners who rent out properties classified as “furnished tourist accommodations” under the Tourism Code and subject to the “micro-BIC” regime. Renting out furnished tourist accommodations will be treated as a service-providing activity, placing these landlords under the “micro-BIC” regime for annual income up to €77,700, with a deduction limited to 50% for the calculation of taxable rent.