Tax liabilities for Australians retiring to France

(Graeme Wood) #1

My wife and I intend to retire to France, purchase a house and live off the earnings of our Australian superannuation investment. We also want to have access to Carte Vitale. Several issues arise with respect to this scenario:

• What are the ATO tax implications for both capital and returns on our Australian super fund if we are no longer residents of Australia for tax purposes?
• What is the tax liability under French tax laws for funds drawn down from our Australian based superannuation account?
• How can we access Carte Vitale and what will it cost pa?

I do someone can assist with this inquiry as it is extremely difficult to get definitive advice from a reputable and reliable source. The ATO web site has no information and it is virtually impossible to contact for advice. Many Australian expatriates make comment on a variety of blogs but much of the information is conflicting. Given the gravity of moving to France we need to have accurate and current advice to inform such an important decision.

I look forward to informed comment, preferably based on first hand experience. Thank you.


(Patrick O'brien) #2

It appears that the France -Australia treaty is very similar to the uk- france treaty , with whih i am quite familiar.
See these sites for relevant information (copy of treaty and french notes explaining treatment of foreign income).
link on site to draft treaty, see in particular articles 17- “pensions and annuities”, and article 23-" elimination of double taxation" .

The effects of the treaty on dividends and interest are set out more clearly in the french note -top left of page 5 where it shows that a tax free % of such income declared gross in france is given -11.2% interest , and 17.7% dividends ; this represents the tax paid in australia.

Page 3 paras 200/210 also shows that where there is a treaty (as in this case there is), dividends also receive a 40% tax free allowance.

Regarding Carte Vitale , once you have lived in france for 3 months (best to register your arrival at the local health authority-see link below) you are entitled to apply for health cover under the PUMA scheme , which costs 8% of your taxable income after a deduction of just under 10 000€ (this scheme is new and still being fine-tuned and may or may not exclude pension income).
See here;

Hope this helps.


(Graeme Wood) #3

Hi Patrick,

Thank you for your prompt response and the attached information. Looks like my weekend reading is sorted out!




(Rob Leacock) #4

Graeme can I ask what conclusion you came to on this?


(Graeme Wood) #5

Bilateral Tax Agreement.pdf (87.4 KB)

Hi Rob,

Despite the bi-lateral tax arrangement between Australia and France, Australian pensions and superannuation payments (which are deemed to be pension payment according to Article 17 b i) and b ii) of the Agrement) are subject to tax under French tax law. However, if you are a former public servant your pension is tax exempt (refer to Article 18, 2 a) and 2 b) of the Agreement, attached).

To date I have been unable to get definitive advice with respect to contributions sociale and carte vitale. As it happens, we are going to France in June so this will be an intensive fact-finding mission to confirm all information at source.

Sorry I can’t offer more.