Overtime in France: Tax Exemption, Social Contribution Reductions and Payroll Pitfalls

Exemptions on overtime apply only to genuine overtime — that is, hours worked beyond 35 hours. Three very common situations trip up payroll: a contractual working week shorter than 35 hours, a week involving an absence, and the interaction with the special flat-rate deduction (déduction forfaitaire spécifique, or DFS). Here is an overview, from the employer’s perspective.

This article is part of our series Payroll Law: The Employer’s Guide.

Reminder: what is an overtime hour?

The statutory working time is 35 hours per week. Overtime consists of hours worked beyond 35 hours (Article L. 3121-28 of the French Labour Code). A shorter contractual working week (e.g. 32 hours) does not, in itself, convert the hours between 32 and 35 into overtime: they remain ordinary hours, unless a collective agreement or the employment contract provides for more favourable terms.

1. Contractual working week shorter than 35 hours

In principle, the hours between the contractual working time (e.g. 32 hours) and 35 hours do not qualify for:

the reduction in employee social security contributions — reserved for overtime under Article L. 241-17 of the French Social Security Code (which refers to Articles L. 3121-28 et seq. of the Labour Code);
the flat-rate employer deduction — which targets “any overtime hour worked” (Article L. 241-18 of the French Social Security Code);
the income tax exemption — Article 81 quater of the French General Tax Code exempts the remuneration referred to in Article L. 241-17 of the Social Security Code.

The BOSS (the official social security bulletin) confirms this: for full-time employees, the exemption covers hours worked beyond the statutory working time.

2. A week with an absence: it all depends on its nature

Ordinary absence (sickness, unpaid leave, unpaid time off): hours paid at the normal rate are not overtime → no exemption.
Paid leave — a point to watch: since the ruling of the French Court of Cassation of 10 September 2025, for an employee whose working time is calculated on a weekly basis, paid leave days may have to be taken into account in the overtime trigger threshold. Certain hours may therefore become legally classified as overtime. However, the impact of this reversal on entitlement to social and tax exemptions has not yet been the subject of explicit administrative guidance: exercise caution in payroll processing.

3. Income tax exemption and the DFS: before or after the abatement?

The special flat-rate deduction (déduction forfaitaire spécifique, or DFS) reduces the assessment base for certain contributions, but not the CSG/CRDS (social levies). The tax exemption on overtime cannot therefore be calculated on the basis of contributions after the DFS. Example: gross remuneration of €2,000 (including overtime), a DFS of 10% bringing the contribution base down to €1,800 → the tax base is not €1,800. The calculation is carried out according to the rules governing taxable net pay, with the CSG/CRDS determined without applying the DFS.

Frequently asked questions

Are hours from 32 to 35 exempt? No, in principle (these are ordinary hours).

A week with an absence? No exemption in the case of an ordinary absence; be vigilant regarding paid leave (Court of Cassation, 10/09/2025).

Tax exemption and the DFS? The calculation is based on taxable net pay, not on the base after the DFS.

Written and supervised by Audrey Mourer, Chief Operating Officer and Head of the Payroll Advisory Practice at DAIRIA Avocats.