Cotisations Sociales on Rental Income

[quatrechats]

Please forgive this possibly stupid question but the 15.5% social charges on rental income - are they deducted from the gross income or the 70% of income remaining under the micro-foncier system?

Thank you.

[Chancer]

Do you only get a 30% abattement?

 

I get 71% so I pay the social charges on the remaining 29%.

 

Your choice of the words "deducted from" brings out the pedant in me, to my knowledge you dont get any allowances for them so they are not "deducted from" gross income but "levied on" net income AFAIK.

[quatrechats]

Well, my head is spinning even more now. Reading the instructions on how to fill in the tax form, after entering the gross income,

une déduction forfaitaire de 30% sera ensuite automatiquement appliquée par l'administration

which I understand to mean 30% will be taken off the taxable amount, leaving 70% taxable income. Please tell me where I'm going wrong and why would 71% rather than 70% apply to you?

Thanks again.

[Chancer]

At a guess I would say you have an unfurnished rental, the abattements have dropped so low on those that they are barely Worth doing Under a régime forfaitaire.

 

I think meublée is a 50% abattement or 71% if meublée de tourisme and classified by an organisation.

 

A couple of peculiarities, Under auto-entrepeneur you get the 71% abattement without being classified but then you are paying extra cotisations for health cover.

 

I declare Under revenue non pro BIC and am getting the 71% but havn't been classified, I took a punt on it and it worked out.

 

[quatrechats]

Yes, it is an unfurnished rental and that explains the difference in abattements. Thank you for clearing that up.

[SC]

Chancer said:I think meublée is a 50% abattement or 71% if meublée de tourisme and classified by an organisation.

I've posted this link before and no-one commented - it's not official but worth a read, and I've reverted to 50% abatement on the strength of it:

http://www.toutsurlesimpots.com/location-meublee-pas-de-classement-requis-pour-le-regime-fiscal-des-gites-ruraux.html

Steve

[quatrechats]

I read that French residents in receipt of a UK state pension are no longer liable to pay social charges on rental income. Does this not apply to you, Chancer?

[Chancer]

I'm a long way from being a pensioner, if what you have heard is true then its outrageous and will result in bad feeling from the French who pay the charges on their income, they are quick to claim concurrence deloyale at the best of times, in this instance they are justified.

[quatrechats]

It's to do with the fact that the cotisations sociales go towards French retirement pensions and healthcare costs. As UK state pensioners aren't affiliated to the French system and have their costs covered by the UK, it was ruled at the European Court of Justice in April that they should not pay such charges.