Source withdrawal: definition, operation and amount

The withholding tax (PAS) has been implemented since January 1, 2019. It consists in leaving a tax due on an income before its payment from its beneficiary. This withholding tax applies to wages, retirement pensions, replacement income, income from movable capital and social security contributions. Definition, rate, amount … Focus on the withholding tax in 2025.

Capital video: All about the withholding tax

• 
  

  To safeguard
  
  
  

  Saved
  

What is the withholding tax?

Source at the source of income tax: definition

The deduction from the source of income tax entered into force on January 1, 2019, in accordance with the order of September 22, 2017. This tax recovery consists in leaving each month the sum due from the pay slip, according to a levy rate calculated by the tax administration. Thus, payment is spread over twelve months and the one year offset deleted. The tax automatically adapts to the amount of income received. The taxpayer has only to declare his income each year in the spring.

A recovery taken by the employer or financial institutions

The tax levy is taken by the one who pays income, so it may be:

• employer for treatments and wages;
• of the pension fund for retirees;
• financial institutions and banking establishments for financial income such as interests or dividends.

What are the income taken at source?

The source deduction applies to the following income:

How does source sample work?

A deduction on taxpayer’s income

Since January 1, 2019, income tax collection has been taken thanks to the withholding tax (PAS). Its objective is to pay the tax as close as possible to the collection of taxpayer’s income. Each month, the employer must deduct from the salary paid to the employee, the amount of the levy which corresponds to a common, individualized or neutral rate.

Note : If the taxpayer situation changes during the year, it must inform the taxes.

A deduction according to the rate set by the tax administration

The establishment which collects the withholding tax can use the rate communicated to it by the tax administration. The latter is calculated from the elements provided on the income tax return of the previous year.

This rate can be a common rate for both spouses or PACS partners or an individualized rate depending on the situation of each home of the home. The employee can also request the application of a neutral rate if he does not wish to share his personalized rate to his employer. By default, it is generally higher.

After applying this rate, the collecting body deduces the amount of the withholding tax at the source of the income concerned before paying them to the beneficiary.

Note : For retired persons, income tax is deducted from the source by pension funds according to the rate calculated by the tax administration.

>> Our service – Test our life insurance comparator

What is the rate of withholding tax in 2025?

Rates grid for income received in 2024

The rate is changed each year in September, depending on the income tax return from April to June. It is possible to consult it by connecting to its particular space on impots.gouv.fr. For income received in 2024, the 2025 default rate scale in mainland France is as follows:

Rate grid for income received from May 1, 2025

Here is the grid for income received or made from 1ᵉʳ May 2025 (which will count for the declaration of income in 2026):

How to calculate your withholding tax rate?

Tax rate calculation formula

The source deduction rate corresponds to an average tax rate excluding tax reduction. It is obtained by dividing the amount of income tax by the amount of income according to the following calculation formula:

(Total income tax before reductions / tax credits x (taxable income subject to withholding tax / total taxable income) / income subject to withholding tax) x 100

Calculation elements

Total income tax before reductions/tax credits corresponds to income tax from the entire household. Its amount is determined after application of the progressive scale to all the home income and taking into account the family quotient. The amount of the tax can be reduced by the discount (a reduction mechanism for low incomes) and, in some cases, by a Tax reduction based on income level. This calculation intervenes before subtracting the other reductions and tax credits to which the home could claim.

Taxable income in the field of withholding tax are those subject to the withholding tax. Finally, the total taxable income corresponds to the total net income of each category received by all the persons of the tax household, whether these income is subject to the withholding tax or not. This amount is calculated before subtracting:

• deficits from previous years,
• The deductible share of the CSG (generalized social contribution),
• deductible loads,
• Specific abatements for the elderly or families with married or dependent children.

Online simulator to estimate the tax rate and monthly tax amount

Taxpayers can estimate the amount of their withdrawal at source thanks to a free and online simulator. Set up by the government, it is very easy to use. It is enough to indicate the amount of its taxable monthly income and the rate of withdrawal at source. The latter is indicated on the tax notice or accessible via its particular space on impots.gouv.fr.

How do I know if I am taken from the source?

The service “Manage my withdrawal at source” available from the personal account of each taxpayer on the Impot.gouv.fr site lets you know if you are taken from the source. But also to know the rate of your withholding tax and consult the history of all the samples taken by collecting organizations. It is also possible to consult your levy rate on your pay slip.

When is the withholding tax?

Each year, its rate is updated in September, following the income tax return in the spring. If this new rate is no longer in accordance with taxpayer’s income, it can modify it online on the tax site. If his income has dropped, he thus avoids moving too much tax every month. If its income has increased, it is better to enhance it to avoid having to pay a tax supplement in the fall.

Note : Some taxpayers may receive an SGC sample between September and December. It corresponds to the amount of taxes which has not been set by the withholding tax.

>> Our complete tax guide. How to declare your income? How to reduce your tax bill via investments? What to do in the event of administration control?

How to change your tax rate?

Warn the tax administration of a change of situation

Taxpayers must notify the tax administration of any change of situation (marriage, birth, divorce, etc.) likely to modify the rate of withholding tax. During the year, employees also have the possibility of modifying, increasing or downwards, their rate of withdrawal at source from their personal space on the tax site.

Opt for a lower rate than her husband or partner

In the event of a joint declaration, married or PACS couples have an identical source deduction rate. However, they have the possibility of opting for an individualized rate, calculated according to their personal income. From September 1ᵉʳ 2025, each member of a married or PACS couple (subject to common taxation) will automatically benefit from an individual rate,, depending on its income.

Source withdrawal and tax credits

Following the implementation of the withholding tax, taxpayers benefiting from a credit or a tax reduction received on January 15, 2025 a deposit of 60% of their tax credits/reductions. It was calculated on the basis of the expenses declared the previous year.

In the spring, during the declaration of income and expenses, the final amount of tax reductions and credits from which taxpayers benefit is calculated and the subject of regularization in the summer.

Each year, the tax administration therefore proceeds to the payment of a deposit in January and regularization in the summer. This regularization leads to two situations: the payment of a credit balance or tax reduction, or to the taxpayer’s bank account of too much paid by Bercy.