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Here is a wierd situation....


Afy
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Potentially I might end up working in the UK, and paying taxes in the UK. However France would continue to be my primary residence, since my wife lives here....

 

What happens to taxes? France or UK? The company is registered in the UK and will pay into a UK bank account. And potentially I would be travelling across the globe for them.

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I am in the same situation - complicated further by the fact that I work a lot in Belgium too - and have had lots of conflicting advice on this.  But I think  it is the case that you would continue to pay tax in UK, but would have also to make a tax declaration in France, on which you would include your taxed income from the UK.   This would not be taxed twice, but would be taken into account when calculating what rate of tax (if any) you had to pay in France - if your wife was working there or had other income of her own, for example
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If your company is registered in the UK it will be subject to UK

corporation tax.  Any salary or dividends you receive will be

taxable in the UK but, if you are resident in France it will also be

taxable in France with a credit for any UK tax paid.  You don't

say what your company does but if your company has an office in France

or concludes contracts in France (i.e. - you or another agent of the

company can give quotes and accept orders) it will have a 'permanent

establishment' (effectively a branch) in France under the terms of the

French : UK double tax treaty.  The branch will be liable to

French tax on its profits but these profits will also be part of the

companies profits for UK tax - subject to a credit for the French tax.

Income tax depends on residence (rather than domicile - IHT). 

Residence depends on several factorsincluding: the number of days you

are present in the UK/France  (183 day rule),  your intention

(in terms of residence) when you left the UK to live in France and the

frequency and duration of of your return trips to the UK (91 day

rule).  Unlike domicile, it is possible to be resident in more

than one country at the same time.  You can ask the Inland Revenue

for booklet IR20 which will give details on residence and non residence

rules and how both residents and non residents are taxed in the UK.

It sounds like you have left UK intending to live permanently in France

and so you would normally be considered to be non UK resident from the

day of departure (and resident in France from the day of arrival). 

However, this is when the 91 day rule comes into play - if your visit

are regular and frequent (more than 91 days each year on average - which sounds

very likely if you are working in the UK) you will be resident in the

UK.  So looks highly likely you will be resident in both countries.

Hastobe

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I've been there too, and am likely to be there again in the current UK tax year, so your situation is probably less weird than you think, though that doesn't make it any simpler.

I agree with the above two replies, though tax residency qualifications in Britain and France are quite different. You will certainly be French tax resident by virtue of the fact that your main home and your family are in France. As recommended, read IR20 about UK residency etc - you can get it from the Internet.

From my own experience (of being self-employed) tax is less of an issue than social security. If you can avoid paying into the French system then do so. Our French accountant reckons that for most people such charges account for 46% of your income, though according to what you do and how much you are paid it can be anything between 40% and 60%. And you are not likely to get much back in the way of benefits - other than through the French medical system, which you may be able to access through an E form while in France. If you are employed, things may be easier, though again, from experience of other forum users, most employers baulk at having to pay heavy French employer contributions for the dubious benefit of having one of their employees in France, and in that case the employee tends to be held liable for the charges.

There are too many variables involved to be able to give you particular guidance - the best thing is to take advice from a professional who understands tax and social security issues in both Britain and France, and again in my experience there are precious few of them around.

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Afy,

Sounds like you're going up in the world. Congratulations.

If you'll be working for one of the big consultancies I'd expect their HR people to know what's what. On my latest contract the main implementation partner was Deloitte and there were consultants from at least 4 different countries, including a frenchwoman.

My guess is that all the time your family home is in France you'll be considered "French" for tax purposes. If most of your time is spent working outside France and your employer treats you as UK-based then you'll need to declare your UK earnings in France, including telling them about tax, etc. paid in the UK system.

The other complicating factor could be National Insurance / Social Security. I'd guess that you would be covered in France via your UK NI payments (Lord knows which form!). How this would affect your wife .... ?

I've got a strong suspicion that you'll be better off paying UK tax & NI then declaring in France than the alternative of taking your salary gross and being liable to French tax & cotisations.

However, treat all this answer as a set of questions to ask an expert. I ain't one!

Cheers
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