My partner works from home in France for an organisation in the UK. She is paid in GBP, and returns to the office once a fortnight to work for 2-3 days.
Does anyone know what formalities she needs to do regarding tax and anything else? Her employer has not done anything in particular regarding French administration.
For healthcare she has applied for an S1 form which we will take to the nearest CPAM for her to register on the French healthcare system. Is this correct?
Could you confirm which type of “S1” has she applied for? I’m a bit confused because the form she needs to be applying for is the “workers S1” or form A1. AFAIK this application is normally submitted by the employer, but you say her employer has taken no steps.
The S1 is issued to retirees and isn’t appropriate for workers.
At this stage it’s impossible to comment on the social security aspect because the correct procedure to follow hinges on whether or not she obtains an A1 (and whether it remains valid after Brexit). The conditions for issuing them are quite strict, you have to be carrying out a significant proportion of your work in the issuing country, and HMRC will study her working pattern to decide whether the length of time she spends in the UK is sufficient to justify it. The A1 is intended for posted workers ie sent to work in another EU country by their employer on a temporary assignment, or for cross-border workers ie people who commute to another country to work, typically for 4 or 5 days every week. Spending only a handful of days a month in the UK sounds very borderline to me if most of her working time is in France. But the decisions sometimes seem a bit random - people who from what they say you would expect to get one, don’t, and people who from what they say you don’t think will, do; from which I can only deduce that either HMRC is inconsistent, or they really do study the fine details of each application.
Unfortunately the decision can be slow (months rather than weeks in some cases) and in the meanwhile she is in an irregular situation because technically she shouldn’t be working in France at all unless either she holds an A1, or she’s registered with URSSAF as a worker and paying cotisations.
If her application for the S1/A1 is rejected then her employer will need to follow the process referred to in another thread, probably the one you’ve seen.
A1 holders don’t get a lot out of the French system because all their social security benefits - sick pay, pension, redundancy, healthcare - are paid for by the issuing country. And they do put something in tax-wise, because even if they pay their income tax to a different country they still pay social charges in France on their foreign earned income, which on a decent salary adds up to a sizeable contribution.
It sounds like a UK organisation, so unlikely to have french payroll and tax set up… depending on the size of the organisation this could be an issue for them?
But the principle is that if you are physically in France when you are working, then you or your employer should be paying tax in France. So even if it is complicated to sort out, and there is a temptation not to bother, you should persevere. If you don’t and the french authorities become aware then the consequences could be severe. Including not getting a resident’s permit post-brexit.
This is French law and URSSAF/DIRECCTE don’t really care a hoot how much of an issue it is for companies to comply. There’s not much option because the potential fines for not complying would be a far bigger issue for them. DIRECCTE has stepped up its investigations massively all over France in recent years and whilst its main focus is on posted worker fraud, it seems to be looking closely at the contracts and working conditions of all foreign workers http://normandie.direccte.gouv.fr/sites/normandie.direccte.gouv.fr/IMG/pdf/les_priorites_de_l_inspection_du_travail_2019.pdf
The TFE scheme seems to answer the question I was asking a few months ago about living in France whilst working for my UK based company. Can anyone recommend a really good accountancy firm that could help with all of the administration/tax related to this?
French accountants tend to be number crunchers first and consultants to their clients second. Since all you’ll be paying tax on is your salary and any other income, and your business accounts will remain in the UK. I’m not sure an expert comptable is really what you need.
There are payroll specialists such as https://www.chronopaie.com/ (they are one of the big ones but I don’t actually know anything about them beyond that) who will deal with employment contracts and mutuelles and producing your payslips and paying your social security deductions to the appropriate caisses. They usually deal with companies with multiple employees but presumably they would provide the same services for a single employee.
I don’t think they do tax but if you’re on a fixed salary and your global income from all sources doesn’t vary much year on year, then income tax shouldn’t be an issue once you get your payments set up. You’ll probably get all the tax help you need from your local tax office, for free. The French annual online tax return is literally a few mouse clicks if the figures are pretty much the same as the previous year.
Not sure where you’d go for help registering with URSSAF, apart from asking URSSAF. The online process is designed for you to do it yourself with guidance and support from URSSAF. I don’t know what kind of private provider would best cover that specific niche. I don’t know if a payroll company would deal with the initial registration. I think there was someone on another thread who operates this way, and he had a recommendation - a UK firm if I remember correctly? Or, no doubt one of the big name international business consultants could provide a one stop shop, subcontracting the various strands as necessary.
French administration is geared more towards direct interaction between the citizen and the state, it’s a bit different from the UK where HMRC makes everything so complex that even individuals pretty much have to deal with them through an accountant if their tax affairs are the least bit complicated.
Perhaps a simpler option, depending on your situation, might be portage salarial, have you looked into that? But I don’t know if it works for permanent employees, I think it’s really designed for freelancers and consultants who take on projects for different clients.
Many thanks. My income is a mix of fixed salary and dividends paid at the end of the financial year, though that could change if necessary. I’ll keep looking for a accountants who can help in France, though at the moment, we’re also investigating Ireland.
Not exactly. We’re wondering if moving our business/home to Ireland might be an option instead of France rather than moving to France but leaving our limited company here in the UK. The advantage of Ireland (apart from the low corporation tax) is that there’s a separate agreement between the UK and Ireland that allows us to move there. After five years living in Ireland, it’s possible to apply for Irish citizenship, and retain your British citizenship (dual citizenship is permitted) at which point, voila, you become European again, which brings with it a freedom of movement that we couldn’t achieve by moving directly to France (unless we became French citizens, and my concern is that my husband’s French is not going to be good enough to achieve that.)
So many decisions… My preference would still be to simply move to France but running a UK based business is the factor I can’t currently change that creates complications.
