Do you earn foreign salary and live in France?

Hello,

My husband (UK) and I (US) have been in France for almost a year, and we would like to file taxes in May 2017. We are organizing a meeting with a tax consultant, but I thought I would try on here beforehand.

He receives a salary (around 50,000 euros to foreign bank account) from abroad for consultancy work for a small business. We have private health insurance. We do not have French social security numbers or carte vitales. Will the tax filing be straight forward? What can we expect to pay? Just wanting info from people who are in similar situations.

Others may well be able to give more advice but (and I stand to be corrected) if you’re living in France you should be in the system and get you’re health care etc paid for (carte vitale). However, you may be in for a big surprise as far as what you pay is concerned. Tax or impôt sur le revenu isn’t that great, it’s the charges sociales (roughly equivilent to national insurance) that are very high. As a TNS (non salaried worker/self employed : I run a business here). My earnings are way off 50k€ a year but even so I reckon on giving about 60% to the State (48% charges sociales and the rest in impôt on what I earn. the impôt part of your contributions could take you to well over 60%!) These are ball park figures and your exact situation may change that. Best take professional advice. Well worth getting into the system properly BEFORE any possible Brexit (if it ever happens!) as it may be far harder once the UK is out of the EU :wink:

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Thanks for your reply. I keep seeing that Social charges can be high on forums, but the official percentages on wages are 8%. Is there something else I’m missing in my calculations?

Component Wages
CSG 7.5%
CRDS 0.5%
Prélèvement Social 0%
Contribution Additionnelle0%

Also, is the estimated 60% total tax calculated by parts of household and minus the 9600 tax free part?

Thanks!

if you are salaried then it’s less but no way is it at 8%. To give you an idea, my employee earns the smic and pays 25% in stoppages/NI/charges sociales. ie smic brut 1466€/mois and she takes home 1107€/mois and then she’ll pay her income tax at the end of the year on what she’s earnt. As I’m a non-salaried worker (tns) I’m with the rsi as a commerçant and the charges sociales are about double and we have no unemployment benefit if our business folds. You really need to seak expert advice, France is incredibly complicated with so many different “statuts” and “caisses” depending on your status and job rsi/cipav/cpam/msa to name just the main ones :wink:

Just to add to what Andrew has said - your rates of taxation will very much depend on the source and type of income (earned, unearned, overseas etc ) and whether or not it has previously been subject to any deductions outside of France. Andrews examples are based on earnings generated in France either salaried or self employed. The situation is very different as far as foreign earned salaries, income and investments are concerned. Nevertheless - social charges are likely to form the bulk of your liabilities based on the income figure you’ve quoted.

As you’ve been here some time - you will already have been allocated tax reference numbers which can be found on your Taxe d’Habitation and Taxes Foncières bills. You first income tax return/s will be a manual / paper one which you can pick up from your local tax office or print off from the www.impots.gouv.fr website. You will also find tax simulators on the site which will give you a ball park figure. Technically - you should have made your first declarations in May 2016 on a prorata basis.

As for social security numbers - yours will most likely be allocated by your local CPAM when your register / ed (something you should have done after 3 months residency!). The fact you have private healthcare does not absolve you of the need to register.

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If he actually carries out the work in France, then you have a problem. Any overseas company employing a French resident to carry out work in France must register him as an employee with URSSAF and pay French social contributions on his salary, that’s the law.

If he carries out the work entirely or mainly outside of France, the rules are different.

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Thanks everyone.

We don’t have tax reference numbers, nor habitation or foncieres bills, as we rent a holiday home. We came here to test the waters and are in the process of deciding to stay or not. I have read that it is not mandatory to sign up for CPAM, although if we are paying the charges, we should sign up for it.

The work is entirely outside of France, but he uses the phone/internet and is present in France, if that counts? He also travels outside of France occasionally. Can anyone recommend a good tax consultant? Thanks again.

You’ve been living in France for almost a year - so, if it’s a legal rental, it cannot be classed as a ‘holiday’ rental. Clearly it is a regular long-term rental and as such the occupants of the property on 01 Jan are liable for Taxe d’Habitation for that year. It looks like you have some kind of ‘alternative’ arrangement with your landlord.

You do not ‘sign up’ for the CPAM - but you do need (mandatory) to be affiliated to your local one via whatever channel (contributory or non-contributory) if you are French resident for more than 3 months with the intention of staying - which clearly you have been. Where did you read that this was not mandatory?

It’s difficult for anyone to recommend a tax expert without knowing where you are.

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The deciding factor is not where the client is but where his bum is when he does the work that earns the dosh. If his bum is in France, that is classed as working in France.

If he’s working in France and earning a salary, he cannot claim be inactif and get healthcare from CPAM on that basis. If you live and work in France, you should be paying cotisations on your salary. Living and working in France and not paying cotisations, except in certain situations (eg if you have a portable A1 from another EU country), is not allowed.

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which is why they really do need to get advice and get sorted asap :open_mouth:
à visit to your local hôtel d’impôt would be a good place to start, Erica :wink:

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Ooooops - all gone a bit quiet. Was it something I said? :slight_smile:

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Haha, nope we put an offer on a house and have a meeting with a French tax lawyer! Thanks for the replies. :smile:

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Would you be willing to share what you learn from your French tax lawyer?

Hi Erica, if your hubby is earning in the uk then he will also be paying U.K. Tax on that, therefore as France has a double taxation treaty with the UK he won’t pay tax twice in it.
For yourself you will need to find out if there is a treaty in place between France and the US, there probably will be as there are absolutely hundreds of them.
The 8% that I think you’re talking about is the contribution for health cover, if you work and pay tax and NI outside the country you can choose what parts of the social charges if any you need to pay. If 8% is dearer than what you are paying for private cover then you may well be better off keeping private cover. But really you need to find someone who knows all about it. There are lots of hand holding type services around, we have a brilliant one close to us that will guide you through everything you need to do. Good luck.

would you be willing to share who it is that can help with these tax yuestions?

palma@feetinfrance.fr
Palma is excellent to advise you, she is based in Mirande, dept 32.