Having included my winning in the tax return I have just been told that we no longer need to declare them, and they are exempt the same as other games of chance.
Has anyone else heard this, or seen a reference to it? I can’t find anything to back this up and don’t want to make a mistake.
The winnings aren’t taxed and should never be declared as some sort of income. Capital gains you could have accrued with these winnings the following years are to be declared through (but it will depend on the support you’re using so that’s not true all the time). It depends on the gains but if we are talking 6 figures or more better seek the advise of a professional
6 figures! I wish. Maybe 6 figures after the decimal point…
I wonder why I was told I should declare them before? I can’t remember who said it, but it was that premium bonds are considered an investment by the tax authorities not a game of chance as your capital remains “invested”
I recall that too @JaneJones and we dutifully declared our winnings over 6 years ago and paid tax and CSG IIRC.
We pulled the money out of NS&I when we needed it for our self build so it’s no longer an issue for us (now) poor pensioners… but I remember reading somewhere only recently that they have to be declared exceptionally as the fisc regard them as investment income even though no tax is due in the UK.
Could it be that it refers to the position on CSG if you hold an S1?
I’ve been googling and can find nothing that contradicts this information that I found on an international investment advisers website:
“*You can continue to own Premium Bonds when you move to France, but as soon as you become resident here they stop being tax free, and all your winnings are subject to tax. * Many British expatriates also have Individual Savings Accounts (ISAs) and Personal Equity Plans (PEPs). The income derived from them is tax free for UK residents, but again, they are not tax efficient investments for French residents. The income from both cash ISAs and share ISAs and PEPs are fully taxable here in France.
*Investment income is now taxed as general income in France at rates of to 45%. You then pay another 15.5% in social charges. * If you have a big Premium Bond win, you could lose up to 60.5% of the winnings to tax! You are obliged to declare the earnings on your annual French tax return. The local tax authorities are likely to find out about it anyway, considering the high level of exchange of information between European countries these days.”
If this information were out-of-date I would have thought they would have updated it. If the winnings from premium bonds became tax free I suspect there would be more advisers talking about it. The reason they are taxed is that unlike games of chance here in France where you can lose the lot, your initial investment in a premium bond is always safe.
Thanks…that is exactly what I had understood before this conversation with an accountant. Maybe she was confusing premium bonds with lottery tickets, or even a night out at a casino!
Premium bond winnings are indeed taxable in France; they are not considered to be a gamble because you can recover your stake. It’s logical really because the winnings are paid out of interest.
Blevins Franks are not well regarded in my neck of the woods (SW France) - they lost a substantial chunk of investment entrusted to them by a friend, consequent upon an incorrect interpretation of the regulations.
Just saying.
Isn’t this one of those grey bits - France doesn’t mention them because they don’t exist here and the tax code would be hell if they went round every global option for savings- so tax advisors take the low risk route of its capital gains - others are if they don’t say otherwise its a game of chance?