French Finance Bill for 2023

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France implemented in 2019 a wage tax withholding system applicable to all French
tax resident employees, employed either by French or foreign companies.
Such wage tax withholding system includes a monthly declaration through a special
process for employees who are not affiliated to the French social security system,
called the PASRAU. This mechanism involves a rather complicated identification
procedure with the French tax authorities for foreign companies with no establishment
in France and a complex monthly reporting obligation.

With a view to simplifying formalities for foreign employers, the French Finance Bill for
2023 replaced the wage tax withholding system for certain foreign employers.