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ExemptionIn effectEmployment and contributionsNational

Exemption of employer financial aid for personal services and extension of the family tax credit

The Act of 26 July 2005 on the development of personal services creates a financial aid that a company or its works council can pay to employees to fund personal services or childcare (Article L. 129-13 of the Labour Code). This aid is not treated as pay for social contributions and is exempt from income tax (Article 81 37° of the General Tax Code), within a maximum amount set by decree; it does not qualify for the tax reduction for employing a home worker. The company's spending on this aid qualifies for the family tax credit (Article 244 quater F(I)(f)) for expenses incurred from 1 January 2006 (Article 36(IV)).

Measure originators

InitiatorGVT
Jean-Louis Borloo
Gouvernement
Impact on public finances

No official estimate found for this measure.

Effective date
1 January 2006

Measure impact

Employees can receive aid from their employer to pay for home services or childcare free of income tax and contributions, within a ceiling; the company can include this spending in its family tax credit.

Official references

Law number: Loi n° 2005-841 du 26 juillet 2005 (services à la personne), art. 1, 8 et 36, IV
Official Journal: JORF n° 173 du 27 juillet 2005
View on Légifrance

Sources

Loi n° 2005-841 du 26 juillet 2005 relative au développement des services à la personne et portant diverses mesures en faveur de la cohésion sociale, art. 1, 8 et 36, IVOfficial
27 July 2005

Procedure timeline

Follow the progress of this fiscal measure through the different stages of the parliamentary procedure.

100%
2 / 2 steps
Completed
1 January 2006

Administrative implementation

Application

Entrée en vigueur de la mesure et mise en œuvre par l'administration

Crédit d'impôt famille applicable aux dépenses engagées à compter du 1er janvier 2006 (art. 36, IV).
Source
Completed
26 July 2005

President of the Republic signature

Promulgation

Publication au Journal officiel

Promulgation de la loi n° 2005-841 du 26 juillet 2005 relative au développement des services à la personne et portant diverses mesures en faveur de la cohésion sociale, publiée au Journal officiel n° 173 du 27 juillet 2005.
Source