General reduction (RGDU): checking and correcting the calculation

Quick answer. To check the 2026 general degressive reduction (RGDU), recalculate the coefficient per employee and per calendar year: Tmin 0.0200 plus Tdelta 0.3781 (0.10 percent FNAL) modulated by the ratio between 3 annual SMIC and gross pay. Above 3 SMIC, around 65,629 euros, the coefficient drops to zero.

The general reduction is the single largest contribution saving for a French small or mid-sized business. It is also one of the most closely examined items in a payroll audit. Since 1 January 2026, the former reduction Fillon (then RGCP) has been replaced by the unified general degressive reduction, the RGDU. The application threshold rose from 1.6 to 3 SMIC, the formula changed, and a June 2026 decree froze the SMIC value used in the calculation. As a result, many payroll setups are still calibrated on the old scheme, and the gaps hide quietly inside payslips.

This is not a theoretical concern. An overstated reduction is an unpaid contribution that URSSAF will reclaim with penalties. An understated reduction is cash needlessly tied up. This article sets out the method we apply in our firm to check the RGDU line by line and adjust it cleanly.

The RGDU replaced, on 1 January 2026, the merger of the former health and family-benefit relief bands with the general reduction. It rests on article L.241-13 of the French Social Security Code, whose 2026 wording replaced the 60 percent threshold above the SMIC with 200 percent. In practice, the reduction now phases out at 3 SMIC instead of 1.6 SMIC.

The maximum coefficient also rose, since it absorbs the health and family contribution relief previously handled separately. To place the mechanism within the wider payroll chain, our full overview of the general degressive reduction details the scope and exclusions.

One difference is easy to miss: the calculation is annual. The reduction is determined for each calendar year and for each employee, by applying a coefficient to the gross annual remuneration defined in article L.242-1 of the Social Security Code. Monthly amounts are merely an advance reconciled at year-end.

The 2026 coefficient formula reads as follows:

Coefficient = Tmin + (Tdelta x [(1/2) x (3 x annual SMIC / gross annual remuneration - 1)] to the power 1.75)

Three parameters drive the result. Tmin sets the relief floor. Tdelta depends on the FNAL rate that applies to the company. The 1.75 exponent sharpens the degressivity. The table below summarises the values in force.

The coefficient is then applied to the gross annual remuneration. The work-accident contribution falls within the reduction scope only up to 0.49 percent: beyond that, the company-specific actual rate is not covered. This is a classic source of overstatement when the software applies the full work-accident rate.

To pinpoint the exit threshold, the calculation combines the 2026 SMIC value to apply with the 2026 employer contribution rates.

This is the new feature that causes the most damage. The gross hourly SMIC rose from 12.02 euros to 12.31 euros on 1 June 2026. But for the RGDU, the SMIC value is frozen at 12.02 euros for the whole of 2026, under decree no. 2026-509 of 12 June 2026, which derogates from article D.241-7 IV of the Social Security Code.

Two SMIC values therefore coexist in payroll for the rest of 2026:

• 12.31 euros per hour to compute the gross pay paid from 1 June onwards;
• 12.02 euros per hour for the SMIC parameter of the RGDU coefficient, across the whole year.

Software that updates the RGDU SMIC on 1 June would overstate the reduction. Conversely, a setup that fails to separate the two values distorts eligibility for employees near the threshold. Check this point first in your payroll software setup in Silae or any other payroll engine.

Here is the procedure we run on a payroll file to make the RGDU reliable before closing.

1. Rebuild each employee's gross annual remuneration, including overtime, on the basis of article L.242-1.
2. Confirm the SMIC used (12.02 euros for 2026) and check the pay stays below 3 SMIC.
3. Check the Tdelta parameter against the company's actual FNAL rate.
4. Recalculate the coefficient with the 1.75 exponent and compare it with the payslip figure.
5. Reconcile the sum of monthly reductions with the recalculated theoretical annual reduction.
6. Adjust the gap through the DSN, up or down.

On the reporting side, the adjustment runs through the nominative social declaration. The general reduction is reported under CTP 668. An overstated reduction is corrected under CTP 669. Individual data flow through block S21.G00.81, code 018 for the URSSAF and unemployment share, code 106 for supplementary pension. A progressive or annual adjustment is accepted on these codes, which avoids a rejection for exceeding the cap.

Yes, and it is one of the most frequent errors. Overtime and additional hours are included in the gross annual remuneration that serves as the calculation base. They therefore raise the denominator of the formula and mechanically reduce the coefficient.

The topic is trickier because the overtime premium also benefits from a specific social regime. To keep the two mechanisms separate, rely on our analysis of the treatment of overtime. A payroll run that forgets to include overtime in the RGDU base overstates the reduction and exposes the company to a reclaim.

Some situations deserve heightened attention when checking the RGDU.

Sectors with a high proportion of low pay, such as the hospitality and restaurant industry, concentrate the stakes: a faulty setup is multiplied by the number of payslips and the adjustment bill climbs fast.

A few errors come up systematically in the files we take over.

• The RGDU SMIC updated to 12.31 euros on 1 June when it must stay at 12.02 euros.
• The threshold kept at 1.6 SMIC in a setup not updated to 3 SMIC.
• The work-accident rate applied in full instead of being capped at 0.49 percent.
• Overtime missing from the annual base of the formula.
• The wrong Tdelta used after crossing a headcount threshold.

What the authorities look at#

During an URSSAF audit, the inspector recalculates the reduction on the basis of the declared annual remuneration and compares it with the amount applied in the DSN. Repeated gaps across several employees, an uncapped work-accident rate and a mis-applied SMIC are the first points of reassessment. An internal consistency check upstream neutralises most of these risks.

Our reading is straightforward: the 2026 reform shifted the risk from the amount to the configuration. As long as the formula was stable, an error stayed marginal. With the move to 3 SMIC, the frozen RGDU SMIC and the coexistence of two hourly values, every line of configuration becomes a potential point of failure.

Recently, the director of a service SME asked us for help after noticing an unexplained variation in social charges on a handful of payslips. The payroll engine had updated the RGDU SMIC on 1 June, overstating the reduction on salaries close to the SMIC. The adjustment covered the whole year. The issue was not the calculation, but an automatic update applied to the wrong parameter.

The underestimated risk is to assume the software is authoritative. A payroll engine applies what it is told; it does not know a decree has frozen a derogatory value. Human control remains essential, which is the whole point of structured payroll and social management. As chartered accountants registered with the French professional body, we are accountable for the reliability of these calculations, which calls for a systematic annual review before the last DSN of the financial year.

Hayot Expertise tip. Schedule an RGDU review before the December DSN, employee by employee, based on actual annual remuneration. Check the three sensitive parameters: SMIC frozen at 12.02 euros, work-accident cap at 0.49 percent, inclusion of overtime. One hour of control saves months of adjustment and secures your employer-cost management.