There is a good simple guide in English as an aid to completing the French tax forms 2042, 2047, 3916 which has been published for the last few years. It includes how to input UK rental income, investment income, pensions, etc; the Help document gives the necessary tax form lines which need to be completed. The version currently available is for last year: How to declare your tax online - BH Assurances
For rental income, I was told that it was not relevant whether the property in the UK was rented furnished or unfurnished, since it was taxable in the UK, and not in France (when I first enquired of the local Impots in 2019). So as others have been saying, the only issue is what to declare to be taken into account for your total income in the French tax calcs.
I hope my example may help about form 2044 before carrying it over to Form 2047.
This relates to two apartments in the same building. For the UK rental income I did not have to declare them separately. After deduction of expenses (due to voids) I made a small profit in the year from January 2020 to December 2020. (I do calculate everything for both the UK tax and the French tax year). I queried this with the Impots as follows:
For form 2047… “ (Pour la soumission fiscale au Royaume-Uni, les propriétés ne sont pas calculées individuellement).
Après déduction de tous les frais, les deux appartements ont réalisé ensemble un bénéfice de 175,10 €.
Les intérêts payés sur l’hypothèque (finance) été 2 757,92 € en plus. J’ai donc calculé le déficit (formulaire 2042 case 4BB) comme 2 582,82 €.
Les déficits des années fiscales précédentes sont ceux calculés en avril 2020 pour l’impôt britannique, reportés pour ces deux appartements dans la même maison.”
I received the following reply from the local Impots:
“vous residez en france vous n’avez pas à remplir l’imprimé 2041 E
Vous devez remplir la déclaration des revenus fonciers 2044, le bénéfice de 175 € doit etre inscrit sous les rubriques 4BA et 4BL de la déclaration des revenus, vous ne devez rien inscrire sous la rubrique 4BB, le deficit foncier provenant des années précedentes doit etre inscrit sous la rubrique 4BD de la déclaration”.
Nevertheless I did not actually send a Form 2044, because it was so very specific to France, and they did calculate the tax due without it!
Goodness… reading my way through this thread… advice goes this way and that.
In my neck of the woods, at the moment there is a real-person available to discuss things with…
at the local Tax Office (well, not so local as all that, quite a journey in fact). It’s well worth making an appointment and talking things through.
I’ve asked all sorts of questions in the past, and then followed their advice when filling in the Worldwide Income Declaration…
After all, in the early days it was these very same folk who would be tapping my paper Declaration into their computers…
Now that many are declaring on-line it doesn’t mean one can’t talk things through…
I didn’t find these Tax Folk anxious to gain their pound of flesh, just ready to give helpful advice on what to put where on the forms … and how to arrive at whatever figure…
I think you live in an area where there are quite a lot of English people? So your tax office may have good knowledge and experience. In other areas this isn’t the case, and tax officers whilst trying to be helpful, sometimes head down totally the wrong path. Especially in terms of Brexit muddles.
Apparently there are 400 British people in the Jura, spread over 550 communes! So many cantons will have none at all.
So often it pays to try to work things out for yourself, and then you are able to ask the right questions to make sure tax officer is giving you the right advice.
Yes, that’s what I did, a combination of Jane and Stella’s approaches, went to the office, met the officer, he gave us the paper forms, then after my research a series of e-mails with me proposing methodology and figures - he rung me and agreed these.
When one used to be able to queue, waiting to be seen (before covid certainly)… it was clear that there were far more French than other nationalities… and all of us wanting to ask our questions…
That made me laugh……it’s France so I would hope there would be far more French at tax office! It always takes us by surprise on holiday when we end up in British populated areas as to how different that is.
I think we’re laughing at the same thing… albeit arriving via different routes…
Thankfully our local Tax Office is willing and able to assist everyone… is what I was trying to say… and it’s obviously not just the English who have difficulties/problems…
(and Brit numbers are not overwhelming in my part of France… hurrah )
ah well… it’s good to be able to chuckle at something at the moment…
Can’t see why treatment of a private pension aka SIPP should be any different to an occupational pension scheme as the income paid from a SIPP is achieved in the same way as an occupational scheme …ie investing in bonds, stocks and shares. Both are income from monies paid into a pension scheme when working so is income paid out within a pension wrapper.
I suggest that dividend income earned from direct stock market holding and property rent being held outside a pension wrapper might be subject to different tax rules.
Your question makes me think you might not be aware of the 7.5%% flat rate tax on taking the whole (personal / private) pension in one go - a single lump sum - and you can deduct 10% first - could be quite beneficial.
I don’t know about income from property but I’ve paid tax on my investments dividends and capital gains since I moved here in 2019, pre Brexit. It took 18 months to sort out double taxation, and get refunds from HMRC. There has been a recent ruling clarifying that S1 holders don’t pay social charges, which reduces the payments due, as stated by others.
Hi @Larkswood12, are you saying 7.5% flat and that’s it if moving to France? I know someone who’s thinking about moving to France but would need to gather funds to buy a property.
Do they have a time limit within which they have to do this? or can they come to France then think about in 10 years when they might have more funds? Do you think this also gets him over the UK limitation of being able to only take up to 25% as a lump sum? This could be a reason for him to accelerate the move to France he is thinking about…
I see Elsie has posted the info - and there’s a number of threads on this, not least mine when I asked if you could have the 25% tax free in UK and then the 7.5% flat rate on the rest in France. (You cant but some people have been allowed it). A bit cakeist.
So to recap, take all the pension in one lump sum once in France and taxed - the uk will apply tax and then you have the France tax office fill in the France Form Individual for that pension fund (it’ll have a UK tax ID code), send to HMRC and chase for the refund.
I forgot about the social charges, because I have an S1 so won’t be paying these hopefully!
If your friend gets an S1 (say becomes a frontalier or retires or has a UK retired partner) then they will be exempt.
It’s quite attractive - even on 20% UK tax, a pension contribution yields 18% uplift after paying the France tax. If a higher tax bracket, it’s a no brainer. My pension pot is for house purchase too!
BTY, the actual flat tax rate is 6.75% because even more wonderfully, France allows an unlimited 10% deduction on the lumpsum before applying the rate!
and PS one can withdraw the whole pension in the UK too, not just 25%. The 25% is just the tax free part.
Oh, and no time limit as far as I can see - only if France removes the facility I presume.
I think the lump sum treatment s exactly aimed at people funding a house purchase from a pension fund, because one of the examples in the French tax Bulletin on this rate (posted somewhere here) deals with purchase of a house
So is the 75% left after what the UK views as the max allowable lump sum, then clobbered with tax in the UK?
And is that kept by the UK or not, if the person is taking the whole pot in a later tax year after they.have moved to.France? Or is that tax on the 75% what you’re talking about reclaiming from the UK?
It sounds like if the UK does have to hand it back then there will be a delay before he can get the full money to buy a property. 18 months sounds about how long HMRC are taking to repay tax of other types. So it looks like he will have to find somewhere to rent first here before he can buy.
Yes. I think the pension provider applies an emergency rate - might be at 20% progressive rate, I might have googled one of them to see, I recall it wouldn’t be a massive hit at 40%
And is that kept by the UK or not, if the person is taking the whole pot in a later tax year after they.have moved to.France? Or is that tax on the 75% what you’re talking about reclaiming from the UK?
Reclaim the 75% tax from HMRC yes.
Yes, JoCo said it took him ages, but not 18 months. I did get quoted 9 months though I think. In fact after we sent our France DTT forms to HMRC, I rung for an update and they couldn’t find it at first (it was filed under partners name) and the tax officer said OK I’ll process them today as they’re in front of me! So one never knows…
Thinking abut the social charges, if they’re to be paid, then it makes the lump sum France tax rate approximately similar to the UK rate if one keeps the lump sum withdrawals to within the 20% UK tax rate - France 9 (?) + 7.5% versus UK 25% tax free off of the 20% tax rate = 15%
So if there was no chance of an S1 for your friend, then they might want to go back to their plan A…
albeit arriving via different routes… 