In-home employment: the real-time tax credit will come into force in 2022

Individuals employing home workers are set to benefit from a reform included in the Social Security Finance Bill for 2022. From next January, the tax credit they can claim will be paid in real time.

An immediate tax credit to boost purchasing power

Currently, 4.2 million French households employing a home-help worker benefit from a tax credit. Under this scheme, they are reimbursed for 50% of the sums paid, up to a maximum of 12,000 euros per year. This ceiling rises to 20,000 euros if one member of the household is disabled.

Until now, individual employers had to wait a year to receive their tax credit. A first instalment of 60% was paid in January, and a second instalment of 40% in the summer.

The aim of the reform, like the income tax deduction at source, is to simplify the procedure, but also to increase the purchasing power of the households concerned.

A three-stage reform

The reform will be rolled out gradually, as it applies to very different situations. For example, some individual employers use service providers or agents, others benefit from social assistance, and individuals use both the Cesu + platform and the Pajemploi platform, the latter being reserved for childcare.

In concrete terms, the real-time tax credit scheme will come into force in three stages. Initially, from January 2022, the reform will apply only to individual employers using the Cesu + platform, for home tuition or housework, for example. This will affect 2.4 million households.

In a second phase, fromApril 2022 onwards, private individuals using agent or service provider companies will in turn be able to benefit from real-time payment of the tax credit. These new arrangements will affect 400,000 households.

Finally, in a third phase, starting in 2023, the tax credit will also be paid out in real time to individual employers with loss of autonomy, who receive the disability compensation benefit (PCH) or the personalized autonomy allowance (APA).

Private individuals who use the Pajemploi platform for childcare will have to wait until 2024. In total, this tax scheme will generate 4.85 billion euros next year.