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Payslips and Employer Contributions in France: A Guide for Overseas Employers

It would seem that one of the simpler tasks of employing workers overseas would be calculating and issuing the payslip.  However, every country has its own rules and formats that are required to meet their requirements, and France is one of the more complex payroll jurisdictions for a company to understand.

The question that you need to ask if you are running a French payroll DIY is how do you know how to make all the right deductions and contributions? 

There are 15 different categories of contributions and taxes in France, and all of these are listed on the payslip with French abbreviations.  Here is quick guide to help you understand the basics of French payroll, and some of the unique features that you may not have encountered before.

Social Security Contributions in France

Here are the primary social security contributions in France, which can total up to 50% of salary for employers and 28% for employees.

  • Family Benefits
  • Health and Sickness
  • Social Charges
  • Accident at Work
  • Unemployment Benefit
  • Main Pension
  • Complementary Pension

All of these will be listed on the payslip and the actual rates will vary depending on the industry, company size, compensation and job position.  Just to complicate things further, some of these are taxable to the employee and others have exemptions or reductions in certain circumstances.

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Employer Health Care Contributions in France

Case Example: Mutual Reintegration | Réintégration Mutuelle

An employee in France of one of our clients was trying to read and understand their own payslip, and had a question of why his net pay was lower than expected.  We consulted with our local employer of record in France and came up with an explanation.

There is a practice in France of réintégration mutuelle which allows the employer to make their social security contributions directly to the authorities, but it is still listed on the payslip and included in gross compensation. 

For example, health care contributions are taxable in France to the employee, so needed to be included in the taxable salary on the payslip even though the employer made the payment directly on behalf of the employee.

The Shield GEO Solution

This is an example of how involved running a foreign payroll can be, given the differences in rates, exemptions and even language.

If you are hiring employees in France, you have to be asking these questions:

How do you calculate all of the French contributions?

Which contributions are taxable, and which are exempt?

How do the calculations affect the employee’s net pay?

The Shield GEO solution is designed to support your HR department in answering these questions, and issuing correct and complete payslips, withholding tax and making all contributions.  If you are concerned about handling this on your own, we can make international employment simple for you with our local employers of record in over 90 countries.


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Looking to hire an employee in France? Get in touch.

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