How to pay less tax thanks to donations

Support a cause that is dear to you, or assist a political party can make you benefit from a tax reduction.

who can I give ?

The list of bodies authorised to receive donations from the public is very wide : foundations and associations recognised for public utility (Fondation de France, French Red Cross, etc), organizations of general interest, philanthropic, educational, scientific, social, humanitarian, sporting, family, cultural ; associations for assistance to persons in difficulty, providing them with free meals, care or supporting the housing ; associations of worship, or charitable organizations ; institutions of higher education, or artistic education, public or private, non-profit, corporate foundations, academics, hospital, etc

You can take advantage of this benefit for the donation but also for the contributions paid to political parties or even funding the election campaign of a candidate. But be careful, the electoral code provides that you can't pay each and every year, more than 4 600€ per election and more than 7 500€ for the financing of political parties, while the general tax code limits the amount of donations and contributions for entitlement to the tax reduction to 15 000 € per household per year.

In what form ?

The majority of foundations and associations invite people to give online by credit card directly on their site. Otherwise, it is possible to make donations by cheque, bank transfer ... But donations of money are not the only ones open right to the edge : the abandonment of income, such as rent of a property that you give on hire, or expenses that you incur as a volunteer in an association, provided that you have expressly waived their refund, you can also benefit from it in the same conditions.

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It is also possible to take advantage of this feature by subscribing to savings products, solidarity - savings books, life insurance contracts, fund shares ... - in which a portion of the revenues (at least 25% to qualify for the label "Finansol") is paid in the form of donations to one or more charitable organizations with which they are associated.

For what amounts ?

"there was no year white for the gifts" says Axelle Davezac, Director general of the Fondation de France. Even if most households will not have to pay tax on their income from 2018, because the amount of the tax will be cleared thanks to the introduction of a specific tax credit (the tax credit for the modernization of the collection - CIMR), the tax reduction for gifts maintains its tax efficiency this year.

For donations to organizations that help people in difficulty, such as "Restos du cœur", it is equal to 75 % of the payments made up to the end of the year, since these payments are retained in the limit of 537 €. For the surplus, and donations to other organizations, political parties included, the reduction is equal to 66 % of the amounts paid, deducted, within the limit of 20 % of taxable income. If you exceed this limit of 20%, the excess is carried forward over the following five years and allows you to benefit from the tax reduction under the same conditions.

For example, if you pour 1 000 euros, before the end of the year, of which 600 € to an organization that provides assistance to people in difficulty, you will be entitled to a tax reduction of 709€ 403€ to the donations made for the benefit of the organization that provides assistance to people in difficulties (75% of 537) and 306€ for the other gifts [of 66% of (1000€ - 537€)].

If this is the first time this year as you make donations giving the right to the tax reduction, the corresponding amount will be refunded in full in September 2019, if you have not seen that current revenue in 2018. But, if the amount of the tax reduction is greater than the amount of tax to pay, you will refund the amount of the tax reduction which would be charged on the tax payable, not the total. If you have received exceptional income in 2018, the amount of the tax reduction will be deducted from the tax relating to such income are exceptional that you will have to pay in September 2019.

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On the other hand, if you have already benefited from this advantage for the taxation of your income in 2017, you will receive at the beginning of the year 2019, an advance equal to 60 % of this benefit. The 40 % "remaining" you will be reimbursed in September 2019. But beware, if your donations to 2018 are lower than those for 2017, the advance should be regularized in 2019, or even refunded !