Many thanks elsie, a good heads up on the 2OP option,
I don’t think box 2OP is good for me this year, and to check I did a calc on the simulator with box 2OP checked and it wasn’t.
And sorry I meant on declaring interest I was talking about UK interest to be declared in France - I’m presuming under the double tax treaty as a france tax resident I don’t have a choice of how to treat it? I’s all taxable in France and not in the UK.
Was your comment about people getting taxed on interest by the UK even though they have to pay france tax on interest?
I didn’t enter any interest into this years UK tax return. From line 230 onwards it seems if there was any UK tax deducted then the interest amount less UK tax would still end up declared in box 2TR, which you’d then get taxed on at France rate.
Re the 2OP box… when you did the simulator did it actually tell you that it was NOT good to tick 2OP, or merely that it wasn’t necessary…???
I only ask since a few years back, when 2OP came into being, there was a rightold shindig across the country, as so many folk (French and others) didn’t understand the implications…
some didn’t tick it and ended up paying higher taxes than they really should have…
Also… on that particular occasion it was clearly stated that the decision made was binding for future years… aaargh. They eventually hit that on the head and now I believe one can choose each year… if one wants to… and the machine is supposed to prompt you to tick 2OP if your situation warrants it.
We are on a low-income but I always tick 2OP just on the offchance… so that if I come into some money I’ll be taxed at the lower rate… if necessary. Don’t want some official telling me I “should have read the small print …”
You are right, no choice but to declare and pay in France. But you may have to pay tax in the UK, declare it in France and get a tax credit (which I believe, because of the tax tables are different could result in more or less than you paid in the UK?)
I’m not very well up on how UK tax is now handled. Amongst others, I have had a UK public pension since 2000 and UK tax is deducted each month. When I moved to France in 2002 I still had to complete a UK tax return for several years which included some share dividend and some interest. But that all added up to less than the tax threshold and all the UK tax was refunded. After a few years they stopped asking for a tax return and since then have just added a notional unearned income sum to generate my tax code, which still results in all the tax being repaid.
I do not know how the the Inland Revenue know about those above the income levels I mentioned but I would assume UK banks, etc declare interest paid (and possibly retain tax?) to the Inland Revenue? Someone in France in that situation would need to declare that tax in section 230 and receive a credit for it.
Simulator doesn’t give any indication of what’s best. Arithmetically it all hovers around the 11% band - if you have space in that band or below, then you’re better off.
Once you’re in the 30% band, you’re not. As Elsie says, the different parts will affect the amounts in each band.
No it doesn’t but it is the way the Inland Revenue do their calculations.
Each year I get a tax code based on the tax free allowance minus my state pension and this is given to the local authority (LA). My pension is greater than that remaining tax free allowance so the LA taxes me based on the tax code.
The Inland Revenue know I’m taxed in France for all my other income. At the end of the UK tax year the Inland Revenue sends a statement which only includes my LA pension, and notional figures for untaxed dividend and untaxed interest (but not the state pension as they know that is taxed in France). The total UK income they’ve listed is below the tax free allowance. So I get a refund of the UK tax paid.
Regarding 2OP, if the net income per part in the household is less than 26,070€ then it is best to tick 2OP as all the unearned income (dividends, interest, etc) will be taxed at the scale rate of 0% or 11%.
Above 26,070€ per part, it depends how much of the unearned income there is and how much would be included in the lower 11% band; the calculation is a bit more complicated. The flat rate is 12.8% but the above 26,070€ band is taxed at 30%. However, if it is not taxed at the tax band rate it is not included in your net income taxed using the bands.
So you need to do two calculations if you are just into the 26,070€ band. However, calculating that net income per part is not that simple, given all the various allowances to get to the figure.
UK Interest is paid by banks now with no tax deducted (except for e.g. co-op or Halifax ‘interest’ reward which they pay 20% to HMRC. HMRC have a form to reclaim tax deducted in this case.
Yes, all interest paid is reported to HMRC, well at least that’s the idea. One can ring them up and they’ll tell you the amounts they hold - by giving you the last four digits of the account numbers and the amounts. (They might also have the institution name IIRC).
Useful for reconciliation - they’d missed out a £400 odd payment, which they gleefully added to their record!
And of course it’s these records amongst others which we can expect to be shared with France if they so wish…
That’s interesting, Mme will be starting state pension in August and has a LG pension.
I enquired when I discussed the DTT forms with HMRC - yes I got to speak with a ‘technician’! and I think she said when the state pension is paid it wouldn’t change the new tax code she was going to apply to the LG pension.
must confess to never hearing of that.
Both of us have UK Govt Service Pensions (as well as the UK State pension) and we both get the full UK single person allowance £12,750 with the tax code to match. That code is transmitted by HMRC to our Govt Service Pension providers and in both cases, (as they are below the threshold) no tax is deducted.
We both completed the France-Individual forms once we had a French TIN and there have been no issues since (except for one glitch where, in both cases, HMRC “forgot” the French tax status and our Govt pension providers started taking account of our State Pension income) This was soon remedied and the tax taken was refunded at the next payment by the providers. HMRC marked the tax records forward to ensure it didn’t happen again (and it hasn’t). That was now some 5years+ ago so pretty confident that the position is maintained.
Others I know from having provided the tax guide and have expressed a view are treated by HMRC similarly.
Box filling progressing well, all according to guide - until…
My interest field 2TR is pre-populated with a whole 2 euro’s, seems my sole france savings account has linked (caught) up.
Box 2BH is also populated with 2 euros, as far as I can figure out, this has nothing to do with me if I don’t opt for the progressive scale of taxation 0TP?
It won’t apply / make any difference if I’m opting for the flat rate tax on interest?
Do SFR’s with French interest who are on progressive scale rates (2OP) receive CSG credits, which is my understanding of Box 2BH from the brochure practique?
The boxes are prefilled with figures the fisc know about and possibly you ticked 2OP last year so they’ve assumed that for this year? Don’t worry about them. Go forward and complete 2047 and then report the figures back to 2042. They should be added to anything already there (in the past that could result in a doubling up if you’ve already filled some, so needs to be checked). Then make your 2OP choice.
I think the last para on p136 of the 2022 IR brochure answers your CSG query?
Si vous n’optez pas pour l’imposition au barème de l’ensemble de vos revenus de capitaux mobiliers et gains de cession de valeurs mobilières, les revenus inscrits ligne 2BH n’ouvrent pas droit à CSG déductible
On declaring bank accounts, the address field is very fussy, no commas etc but even then still ‘thinks’ there’s non-alphanumeric characters. So after a couple of forms I spotted there were no asterisk as a required field, so didn’t put in any addresses for next few. I’ve paused now, I hope I wont get any nasty surprises rejecting the lot when I log back in and finish all 21.
Managed to pick up the bank accounts again, I’ve now got to the end of the return but before I click completed I’ve had a thought on the dreaded foreign bank accounts.
Last year with the paper declaration the tax official said just to e-mail him a pdf of the document list of accounts.
It occurs to me to say that and attach it on this return, having only entered new and closed accounts in 2021. Not sure whether to do so and if it is a good idea how to.
As there was over a hundred on the paper one, I couldn’t enter them all here anyway?
You need to submit all your bank accounts, etc that are still open and also those closed during the year. I suspect the system might take up to 99 but it would be a pain to enter them correctly. They should be getting details from each account and if they make a comparison and find some missing, the fines can be quite large. A few years ago I reduced consolidated and closed many I had to a much more manageable 15!
Perhaps a paper submission might be better but they seem to be asking for more in a slightly different format this year. However, I think an abbreviated submission might be enough - they can always ask for more detail. This is the current paper version of 3916
Thanks elsie. Sounds like very good advice - yes the penalties are alarming!
I can’t see anything in the return to be able to upload a paper return - presume I shall have to send a secure message, can this have attachments? Or at least I can explain and ask.
Sent my previous paper form Cerfa 3916 by secure message, will update when / if response received.
Many thanks to Graham, probably many times. Many thanks to elsie for my bits Graham didn’t cover.
I thought I’d just pay each year after the declaration. Though it looks like I have to pay a monthly / quarterly payment ‘prelevement de source’ from the bank account.
Is that the case for everyone with no France tax sources? - I didn’t see that in Grahams final screenshot
I’m presuming I’ll get direct debits taken from the bank account I’ve given? I’ve opted for ‘trimestrial’ - seems to give more time for the £ to go up again like Brittania on the waves, Brexit opportunity realised etc etc …
And the assessed tax - that amount will actually be taken at some point? When is that usually? I’m assuming the prelevement isn’t to pay off my assessed amount!
