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Exceptional Income Tax: what are the rules?

Verified 08 avril 2021 - Legal and Administrative Information Directorate (Prime Minister)

If you earned exceptional income in 2020, this could result in a significant increase in your tax. To limit this tax increase, you can apply for the quotient system.

If you received severance pay in 2020, you can request that the taxable portion of the severance pay be taxed on the quotient system. These revenues are considered exceptional regardless of their amount.

The quota system avoids the progressivity of the scale tax.

It applies in 2 steps:

  1. Add one-quarter of exceptional income to regular income
  2. Multiply by 4 the corresponding tax supplement

Exceptional income tax is paid at one time.

  Please note : a special or deferred income notice provides examples of tax calculation using the quotient system.

To qualify for the quotient system, you must include the amount of these allowances on your tax return in the appropriate boxes.

Income to be taxed under the quotient system should not be included in other reported income.

You must detail, on a note attached to the return, the amount and nature of the exceptional income to be taxed in the quotient, collected by each member of the household.

Online Declaration

Internet reporting is mandatory if your main residence is equipped with internet access and you are able to make your declaration online.

2021 Online 2020 Income Statement

Ministry of Finance

Before validating your pre-completed return online, you must verify the information provided and, if necessary, correct and complete it. Keep supporting documents for 3 years if requested by the administration.

Paper Declaration

In 2021, you can report your income on paper if you are in one of the following situations:

  • Your main residence is not equipped with internet access
  • It is equipped with internet access, but you are not able to make your declaration online

You will use the pre-completed paper return received between April and June 2021. Depending on your situation, this is the return No 2042 or 2042 C. Declaration #2042 RICI groups major tax credits and reductions.

If you do not receive a print (1st declarationchange of address, change in family situation), you can report online or download the necessary declarations from early May on service-public.fr or www.impots.gouv.fr.

Certain income is to be reported on a separate return. You can also download them online. The main annexed declarations are:

Before signing your return, you must verify the information provided and, if necessary, correct and complete it.

You do not have to attach supporting documents to your paper return unless they are documents prepared by you (such as a detailed list of your actual expenses). However, keep the documents for 3 years if requested by the administration.

If you received mobility premiums in 2020, you can request that they be taxed on the quotient system. These revenues are considered exceptional regardless of their amount.

The quota system avoids the progressivity of the scale tax.

It applies in 2 steps:

  1. Add one-quarter of exceptional income to regular income
  2. Multiply by 4 the corresponding tax supplement

Exceptional income tax is paid at one time.

  Please note : a special or deferred income notice provides examples of tax calculation using the quotient system.

To qualify for the quotient system, you must include the amount of these premiums on your tax return in the appropriate boxes.

Income to be taxed under the quotient system should not be included in other reported income.

You must detail on a note attached to the return the amount and nature of the exceptional income to be taxed in the quotient, collected by each member of the household.

Online Declaration

Internet reporting is mandatory if your main residence is equipped with internet access and you are able to make your declaration online.

2021 Online 2020 Income Statement

Ministry of Finance

Before validating your pre-completed return online, you must verify the information provided and, if necessary, correct and complete it. Keep supporting documents for 3 years if requested by the administration.

Paper Declaration

In 2021, you can report your income on paper if you are in one of the following situations:

  • Your main residence is not equipped with internet access
  • It is equipped with internet access, but you are not able to make your declaration online

You will use the pre-completed paper return received between April and June 2021. Depending on your situation, this is the return No 2042 or 2042 C. Declaration #2042 RICI groups major tax credits and reductions.

If you do not receive a print (1st declarationchange of address, change in family situation), you can report online or download the necessary declarations from early May on service-public.fr or www.impots.gouv.fr.

Certain income is to be reported on a separate return. You can also download them online. The main annexed declarations are:

Before signing your return, you must verify the information provided and, if necessary, correct and complete it.

You do not have to attach supporting documents to your paper return unless they are documents prepared by you (such as a detailed list of your actual expenses). However, keep the documents for 3 years if requested by the administration.

If you received a voluntary departure bonus in 2020, you can request that it be taxed on the quotient system. These revenues are considered exceptional regardless of their amount.

The quota system avoids the progressivity of the scale tax.

It applies in 2 steps:

  1. Add one-quarter of exceptional income to regular income
  2. Multiply by 4 the corresponding tax supplement

Exceptional income tax is paid at one time.

  Please note : a special or deferred income notice provides examples of tax calculation using the quotient system.

To qualify for the quotient system, you must include the amount of these premiums on your tax return in the appropriate boxes.

Income to be taxed under the quotient system should not be included in other reported income.

You must detail on a note attached to the return the amount and nature of the exceptional income to be taxed in the quotient, collected by each member of the household.

Online Declaration

Internet reporting is mandatory if your main residence is equipped with internet access and you are able to make your declaration online.

2021 Online 2020 Income Statement

Ministry of Finance

Before validating your pre-completed return online, you must verify the information provided and, if necessary, correct and complete it. Keep supporting documents for 3 years if requested by the administration.

Paper Declaration

In 2021, you can report your income on paper if you are in one of the following situations:

  • Your main residence is not equipped with internet access
  • It is equipped with internet access, but you are not able to make your declaration online

You will use the pre-completed paper return received between April and June 2021. Depending on your situation, this is the return No 2042 or 2042 C. Declaration #2042 RICI groups major tax credits and reductions.

If you do not receive a print (1st declarationchange of address, change in family situation), you can report online or download the necessary declarations from early May on service-public.fr or www.impots.gouv.fr.

Certain income is to be reported on a separate return. You can also download them online. The main annexed declarations are:

Before signing your return, you must verify the information provided and, if necessary, correct and complete it.

You do not have to attach supporting documents to your paper return unless they are documents prepared by you (such as a detailed list of your actual expenses). However, keep the documents for 3 years if requested by the administration.

If you received voluntary retirement or retirement benefits in 2020, you can request that they be taxed on the quotient system. These revenues are considered exceptional regardless of their amount.

The quota system avoids the progressivity of the scale tax.

It applies in 2 steps:

  1. Add one-quarter of exceptional income to regular income
  2. Multiply by 4 the corresponding tax supplement

Exceptional income tax is paid at one time.

  Please note : a special or deferred income notice provides examples of tax calculation using the quotient system.

To qualify for the quotient system, you must include the amount of these allowances on your tax return in the appropriate boxes.

Income to be taxed under the quotient system should not be included in other reported income.

You must detail on a note attached to the return the amount and nature of the exceptional income to be taxed in the quotient, collected by each member of the household.

Online Declaration

Internet reporting is mandatory if your main residence is equipped with internet access and you are able to make your declaration online.

2021 Online 2020 Income Statement

Ministry of Finance

Before validating your pre-completed return online, you must verify the information provided and, if necessary, correct and complete it. Keep supporting documents for 3 years if requested by the administration.

Paper Declaration

In 2021, you can report your income on paper if you are in one of the following situations:

  • Your main residence is not equipped with internet access
  • It is equipped with internet access, but you are not able to make your declaration online

You will use the pre-completed paper return received between April and June 2021. Depending on your situation, this is the return No 2042 or 2042 C. Declaration #2042 RICI groups major tax credits and reductions.

If you do not receive a print (1st declarationchange of address, change in family situation), you can report online or download the necessary declarations from early May on service-public.fr or www.impots.gouv.fr.

Certain income is to be reported on a separate return. You can also download them online. The main annexed declarations are:

Before signing your return, you must verify the information provided and, if necessary, correct and complete it.

You do not have to attach supporting documents to your paper return unless they are documents prepared by you (such as a detailed list of your actual expenses). However, keep the documents for 3 years if requested by the administration.

If you received compensation in 2020 (time-off in case of termination), you can request that it be taxed according to the quotient system. These revenues are considered exceptional regardless of their amount.

The quota system avoids the progressivity of the scale tax.

It applies in 2 steps:

  1. Add one-quarter of exceptional income to regular income
  2. Multiply by 4 the corresponding tax supplement

Exceptional income tax is paid at one time.

  Please note : a special or deferred income notice provides examples of tax calculation using the quotient system.

To qualify for the quotient system, you must include the amount of these allowances on your tax return in the appropriate boxes.

Income to be taxed under the quotient system should not be included in other reported income.

You must detail on a note attached to the return the amount and nature of the exceptional income to be taxed in the quotient, collected by each member of the household.

Online Declaration

Internet reporting is mandatory if your main residence is equipped with internet access and you are able to make your declaration online.

2021 Online 2020 Income Statement

Ministry of Finance

Before validating your pre-completed return online, you must verify the information provided and, if necessary, correct and complete it. Keep supporting documents for 3 years if requested by the administration.

Paper Declaration

In 2021, you can report your income on paper if you are in one of the following situations:

  • Your main residence is not equipped with internet access
  • It is equipped with internet access, but you are not able to make your declaration online

You will use the pre-completed paper return received between April and June 2021. Depending on your situation, this is the return No 2042 or 2042 C. Declaration #2042 RICI groups major tax credits and reductions.

If you do not receive a print (1st declarationchange of address, change in family situation), you can report online or download the necessary declarations from early May on service-public.fr or www.impots.gouv.fr.

Certain income is to be reported on a separate return. You can also download them online. The main annexed declarations are:

Before signing your return, you must verify the information provided and, if necessary, correct and complete it.

You do not have to attach supporting documents to your paper return unless they are documents prepared by you (such as a detailed list of your actual expenses). However, keep the documents for 3 years if requested by the administration.