CPM Contributions - Working UK Gross or Net Salary

[AnOther]

When we actually move over to France, which will be in the spring or early summer hopefully, my wife will be permanantly resident and not working whereas, for the first couple of years at least, I intend to continue working in the UK commuting on a 2 weeks UK - 3 weeks France basis. I will continue to pay tax & NI in the UK on what might be considered a fairly high salary.

I understand that when I come to pay the 8% CPM contribution it will be based on my income but is that gross income or net ?

Also, even though the French house will be our only residence, it would no hardship for me to ensure I was not in the country for more than 183 days in which case what would the French take on that be ?

If it were to my advantage I might even consider purchasing a modest property in the UK and making that my official principal residence.

Don't misunderstand me, I'm not trying to wriggle out of paying the CPM but 8% of my current income (be it gross or net!) would amount to a not insignificant sum of money and the fact is that, so long as I remain with my UK employer I'll be paying NI on top of which both my wife and I are comprehensively covered by a private health plan so certainly if either of us needed elective treatment we could get it done in the UK. Emergencies (god forbid) should be covered for her under the E106 and me under my EHIC.

After I've given up my job it'll be a different story of course and once fully resident in France I'll be happy to pay my share (well perhaps not exactly happy!) because I believe that initially the contribution will be based on the previous 2 years income so will be painful.

[Pommier]

Other people can no doubt confirm, but I think you and your wife would be covered by the UK under an 'E' form (not E106) whilst you're working and paying NI in the UK. If I were you, I'd speak to the Dept for work and Pensions at Newcastle - they are really helpful.

Cheryl

[Suandpete]

    As I understand it an E109 will cover the partner living in France while the one living in UK will use the new version of what used to be the E111 if emergency treatment is necessary in France.

[Will]

Either E106 or E109 might be issued., depending on your circumstances. These last for a limited period - when they expire you (or your dependents if you are still entitled to UK health and social security benefits in your own right) must then join the French system.

France does not operate the same tax residence conditions as Britain. If your main home is in France, or your family/dependents are in France, you are French tax resident and must declare your world wide income in France. Any tax already paid in Britain will be offset against your French liability, so you will most likely pay little or no tax in France.

[AnOther]

Thanks for the input, I will of course be talking to the DWP in due course.

Has anyone got any answers for the prime question though which is: are CPM contributions based on gross or net salary?

I doubt I'll get anywhere with UK Customs & Revenue on this one!

[LesLauriers]

When you do come to pay it, it will be based upon your French tax return, normally, gross salary less 10% plus any other income (savings interest etc).

[AnOther]

[quote user="Leslauriers"]When you do come to pay it, it will be based upon your French tax return, normally, gross salary less 10% plus any other income (savings interest etc).[/quote]Thought it probably would be. What do they usually require as evidence of income, P60 or more, such as bank statements or payslips not that any of those are a problem.

Seems like an opportune moment to plump for a significant salary sacrifice with my employer which reduces my salary by x% with that amount then going into my pension plan, effectively as a company contribution, which then won't appear on my P60 as income. Gotta play the game !

[bikerboy]

In terms of your UK earnings CPAM take your NET income ,i.e AFTER deduction Of  PAYE. ........... been there ,done that !

However the base year is the preceeding 12 months (Jan - Dec & not April to March as in UK.) 

I don't know how French income is treated ! 

 

Hope this helps

[Will]

For French income CPAM takes your RFR (revenue fiscal de reference), which is the amount calculated by the tax office (income less allowances etc) on which you then pay tax. So it is not exactly a gross income, but not a nett income either.

[cooperlola]

Agree with Will.  I did this a couple of weeks ago and the tax return (2005) with our RFR was all that was needed for the calculation to be done.  It was all pretty easy really.

[Anyone for Cricket?]

Hi

When we first made the move I was (and still am) working for a UK company remotely.  I contacted Newcastle and told them that I was going to be working for a UK company but from France. 

They sent me an E106 for 8 years, no one then or since could tell me why they did this, it seems that this is not usual, I did ask the question why of Newcastle and was told not to mention it to anyone, as in, 'you've got it, it's good for you now go away'.  This meant that whilst I continued to pay tax and NI in the UK and declared this on my french tax return as income earned abroad, I did not pay any cotisations in this country as I was employed still by the company in the UK. 

Eventually the UK tax office for reasons unknown decided to return all of my NI and tax paid during the time I had lived in France, about 18 months had passed by this time.  I was now in a position where I had not paid anything for 18 months, this was a little concerning so I set up my micro quickly and now pay cotisations, still doing the same job but am on a contract basis with the UK company who now pay me the same salary but with no deductions. 

All a bit odd really.. but seemed to work in my favour, I'm glad it's all straightforward now though and also that I am contributing to the french system on which I now depend.

I think in your case you should not pay into both systems, your NI contributions will cover your health care in France but how you decide to set yourself for tax domicile purposes will have an affect.