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I don't know the answer to your question, Tony, but let me suggest you read the double taxation treaty and see if it's covered there. I believe there is no pensions agreement between Australia and France. If you can't find specifics about this, it could be best to choose the option most favourable to you and be prepared to justify it or go for a private ruling. Most likely, you'd need some professional advice.
Does anyone know the French Taxation treatment of Australian Superannuation pensions (taken as a drawdown not as an annuity) that are not paid as a result of Government service? I know they they are taxable in France but there appear to be at least two possibilities:
- Tax the proportion of the amount withdrawn that can be considered as "gain" at normal tax rates
- Tax the whole amount withdrawn but with an option of having it taxed at a
"prélèvement au taux libératoire" of 7.5 %
Yeah but aren't they like Notaires, ie. quasi government officials, or is it simply a "more'n me job's worth guv" attitude ? Do they carry thumbscrews as well as a very sharp pencil? :-)
jumping in sideways.
Moving here needs endless research....being here you continue your search.
Our first accountant got things wrong.
Moved on to another co which seemed to have hired a UK chap who
was an accountant in UK.....they really stitched us up and were rude
at the same time.
Our uncomplex tax situation was taken on by an accountant based on;y
half an hour away, Came to see us initially...DECLARED her fee and stuck to
that price when she sent the bill.
Yes she wants to know about every penny of interest and every pound in shares and
absolutely everything. Normal.
I couldn't agree with you more, John, and in fact, even without taxable income, all of your income is considered in assessing whether in fact you have taxable income and it does apply to the bands if it is assessable. Another benefit to someone having O taxable income is that there will be a deduction of your taxe fonciere of 100€ [if you own] in addition to not paying tax habitation and a TV fee, whether you own or rent. What is the problem in filling out a French tax return?
Doreen in reply to your question as to why the accountant completed a tax return knowing i had no income, I don't know. Perhaps he decided it was better for me to do so, which in fact it was as i was exempt from tax habitation so not only did he not charge as he said not worth it for half an hours work he also saved me 700€. Having dealt with the inland revenue and VAT in the UK i don't play silly buggers with either as they both weigh heavier than myself, plus having heard so many here say oh you dont have to declare that then after a few weeks they are down the Hotel des Impots i suspect at least one paying a hefty fine and back taxes is it really a hardship to fill in a form correctly even if you believe your income isn't taxable, they will decide, you wont get taxed receiving nothing i believe ISAS and Premium bonds aren't taxable in the UK but are here
I am sorry, Debra, but your statement is incorrect. It is worldwide income that you must declare. The French will then determine what amounts or what income is in fact 'taxable' and what income is free from taxes as a result of taxation treaty. Of course, if you have no income there will be O taxes or if you have all income taxed at source in another country there will be 0 taxes, but you still need to declare and whether it is taxable or not, it is taken into account as income. When you receive your Impots d'Avis, there is a net revenu figure. That is considered your income. For a reference, I will be happy to refer you to an accountant.
The relevant part of the thread was about tax. That was what I was responding to. But yes, the UK account has been declared as an existing account but on the advice of the adviser, my daughters' trust accounts are not declared although they earn interest (insultingly little at that). If people have piddling little amounts in a foreign account then better they declare the account (not what is in it) rather than face a couple of thousand Euros fine.
Doreen, when it was explained to me, it was expressed as this. If I have £100 in a bank in the UK that has been there for many years but is in an interest free current account and is left to keep the account open I do not need to declare it. There is no interest, therefore in that sense it is not giving me income. For my not very financial/numerate mind that was very difficult to work out but I got the hang of it. So, I do not need to declare it year in, year out. That is, I imagine, the kind of example that applies to everybody although the financial adviser at the tax office who explained it took the simplest route to do so, which I imagine may make it complicated to understand in other circumstances such as the typical almost unnoticeable interest on a lot of accounts that generate so little it would be almost ridiculous to declare. However, he made a point there that it is income and all income combined makes the taxable sum. Doh...
I'm just slowly spending my little stash!
400K sounds a lot but you'd need to be an extremely savvy investor to get an income of 65k out of 400k capital. At current annuity rates you'd need ca EUR 1.3 million to get 65k income.
I just assumed it was a p... take
When we arrived here as permanent residents in December 2010 i went to the Hotel des Impots to tell them i no longer had an address in the UK and all my tax habitation and fonciere bills should now be addressed to the house in France,the following May i received my first tax form. Totally ignorant of the procedure i was advised to go to an English speaking accountant who completed the form, as my pension was yet to start and we were living off our savings there was no tax to pay neither did the accountant charge any fee. When my pension did start in October 2012 i was paying a small amount of tax in the UK, after completing the double taxation form and coming off the UK tax system onto the French i find i am below the tax threshold here so no longer pay tax habitation saving almost 2000€ per year on both taxes also next year i hope to get a cheque from the French tax in return for fitting a wood burning heating system
You have to declare all income. They will determine whether it is taxable or not and it is still taken into account to determine the tax on your income that is taxable, i.e. the bands.
Mike, if you aren't enrolled in the French health care and you don't have a carte vitale, you will not be assessed the tax on social charges. The French have to pay the tax on the social charges as well, but it is a tax on income and the US=French tax treaty is very clear that American social security benefits are not taxable in France and it doesn't matter that an American doesn't literally pay taxes in the US, you are entitled to a French tax credit for any French tax that might be imposed. My position is that the tax for social charges is an income tax but called something else and it should not be imposed on American social security benefits. The French tax credit should be extended to the tax for social charges. I'll let you know next month.
Hi Harriet,
We would be very interested in learning the results of your argument to the French govt about paying the 7.1%. We wouldn't mind paying that if it meant that we'd be enrolled in their healthcare system but from what I've read elsewhere, paying the Social Charges does not automatically give you rights into their healthcare system.
Keep us posted,
Thanks
Mike
Exactly. I have two trust accounts for my daughters in the UK which are in my name until they are old enough to be account holders in their own right. Whilst they get interest which is normally taxable, because they are minors it remains tax free. I jumped through hoops to get the correct information. The fiscale told me I must declare it but eventually I was given exact information which I took to the tax people and now they no longer care. I receive some copyright fees for publications each year, couple of hundred quid at most, tax is taken off by ALCS who collect for authors and that is all that goes into my UK account. I am obliged to have a UK account to receive it because it does not pay on their part to transfer to other countries. It does not need to be declared because it is already taxed.
I know from a couple of French friends whose families have some people with lots of filthy lucre. They open accounts in at least two other countries, allow the fiscales to know they have country two and stash the rest... It is all a game of some kind. A bit like hunt the thimble for the tax people and intercontinental hide and seek for the moneyed.
Yes.
The tax advice we received was that we must declare all worldwide gross income on our French income tax return because we are permanent residents. On the form, there’s a section where you enter the income you have reported in the US from SSI, IRA withdrawals, etc.
The net, total income less income reported to the IRS, is what is taxable in France. For example, UK state or private pensions which have not been taxed at source are taxable here.
We have been filing taxes in this manner for 4 years.