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what to declare on tax form


Llantony
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Thank you Sweet 17, no I don’t take any offence at all, my feelings are my own and I do not expect everyone to share them. My objective is not to be patronizing, but maybe I just can’t help it! ;o)

I agree with you entirely that not everyone’s situation is complicated. As I said I now do my own returns without worry or concern. They are, once you have got the hang of it, very simple indeed. It is easy, as I can always look at last year’s return knowing its right.

I referred a couple of friends of mine to my guy and they felt they did not need any advice, since they had been in France completing their own returns for 25 years without incident. The problem, as it turns out, was that they had been completing it incorrectly and were paying €3,000 per year more tax than they should have. They were able to claim back tax for the last three years, but the rest was lost, somewhere around €60,000! I would suggest that some people understand the cost of everything and the value of nothing, since I would far prefer to pay €300 than €60,000.

The point here is that receiving an ‘Avis d’impôts’ does not mean that you have completed your tax return correctly; it means you have completed a return and the tax office has accepted your figures. One day they may wish to turn around and check your figures, or you may just find you’ve been overpaying.

I also agree that there is a joy in meeting the challenge in many things, but one has to weigh up the risk. Where finance is concerned I do not take risks. I have learned to do things myself, but with caution. “A little knowledge is a dangerous thing” is a very good saying.

It is true that the staff at the Impôts are very helpful, but few have any grasp of the international angle and often misadvise people. “Some guy at the tax office told me” is no defence (unless you have their counsel in writing), as you are responsible for your return.

One of the joys of living in France is that it’s a free country, so feel free to pay as much or as little tax as you wish, but the DIY route also means living with the consequences if things go wrong.

Kate
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Well said, Kate.  I wish I were paying thousands more of euros in tax than I needed to.  Alas, I do not have thousands to pay or indeed thousands, period.

Nevermind, some of us who have very little money also have very little to worry about as regards tax.  Lots to worry about as regards much else, including staying alive on this pittance, but paying too much tax?  No, no worries there![:D]

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Could I please ask a couple of questions which relate to the title of the thread, if not the general thrust.  Firstly, am I right in thinking that all savings interest in France is paid gross, and that it is all liable to tax?  Secondly, I have a french bank account and a Livret which has collected a few Euros of interest in 2008.  I am a UK resident, but submit a french tax return as I am buying an off plan leaseback (tax loss in France in 2007).  I will of couse declare the french interest on the french return for 2008, but do I also have to declare it also on the UK return for 2008/09?  Isn't there a danger that I will be charged for tax both in France and in the UK, and if so, how do I offset any french tax paid against UK tax?  Help as always is much appreciated.
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[quote user="parsnips"]Making yourself aware and benefitting (legally) is not a disreputable pursuit, but plain common sense. 

[/quote]Nice try, parsnips.  But Llantony's friend said he "would be stupid to declare UK savings accounts as

'They'll never find out'."  

That makes it pretty clear to me what his intention was.

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[quote user="allanb"][quote user="parsnips"]Making yourself aware and benefitting (legally) is not a disreputable pursuit, but plain common sense. 

[/quote]Nice try, parsnips.  But Llantony's friend said he "would be stupid to declare UK savings accounts as

'They'll never find out'."  

That makes it pretty clear to me what his intention was.

[/quote]

Hi allanb,

     Why don't you read my post in it's entirety? You will see that I do not in any way support Llantony's friend.

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[quote user="Daft Doctor"]Could I please ask a couple of questions which relate to the title of the thread, if not the general thrust.  Firstly, am I right in thinking that all savings interest in France is paid gross, and that it is all liable to tax?  Secondly, I have a french bank account and a Livret which has collected a few Euros of interest in 2008.  I am a UK resident, but submit a french tax return as I am buying an off plan leaseback (tax loss in France in 2007).  I will of couse declare the french interest on the french return for 2008, but do I also have to declare it also on the UK return for 2008/09?  Isn't there a danger that I will be charged for tax both in France and in the UK, and if so, how do I offset any french tax paid against UK tax?  Help as always is much appreciated.[/quote]

Hi,

   Under the double-tax treaty bank interest is taxable only in the state of residence-ie. the UK. You should receive a paper from the bank showing your interest and where on the declaration to declare it--this is quite likely to be wrong. I think you should show it on form 2042 at box TM, but put a note with the declaration explaining your situation, and in particular that you are non-resident.

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[quote user="sweet 17"]

.

It was such a proud moment when the avis came back and then the Contributions Sociales demand and I felt like a cat who had had the cream.

The feeling of self-satifaction and elation was worth it all.  [/quote]

 

I can honestly say that I have never felt that emotion when being asked to part with my hard earned for taxes etc, perhaps I could forward future demands to you? [6]

For the poster who could not understand why people would want to avoid payng their dues,after the primary reason of keeping hold of their dosh to spend in whatever way they prefer, some of them feel a similar, maybe even stronger emotion when they think (word chosen carefully) that they have got away with it, rather like a bank robber.

However how or when do you actually know that you have got away with it and stop looking over your shoulder, 7 years like the UK?

The question refers to tax evasion not bank robbery! 

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[quote user="parsnips"]Why don't you read my post in it's entirety? You will see that I do not in any way support Llantony's friend.[/quote]The reasons you gave for "not declaring everything" were good ones.  The reason given by Llantony's friend was obviously not, but I thought you might be defending it.  Sorry I misunderstood.

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[quote user="J.Rs gone native"][quote user="sweet 17"]

.

It was such a proud moment when the avis came back and then the Contributions Sociales demand and I felt like a cat who had had the cream.

The feeling of self-satifaction and elation was worth it all.  [/quote]

 

I can honestly say that I have never felt that emotion when being asked to part with my hard earned for taxes etc, perhaps I could forward future demands to you? [6]

 

[/quote]

JR, all I meant was it felt good to be "legal", that all was relatively straightforward, that I'd paid my dues and I need not worry again about these matters as long as circumstances do not change.

And, anyway, I do not object to paying taxes per se.  After all, the state needs to collect taxes to provide services.  I've lived in countries where income and personal taxes were low but provisions like hospitals and schools were so sub standard that you'd spend more paying privately for those than you'd ever pay in taxes.

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Llantony, you cannot pick and choose.  If you live in France, the tax on interest received for UK bank/building society accounts is payable here.  You may not, however, be able to receive the interest gross in the UK (this somewhat depends upon the building society and its regs), and may - as I have to - need to reclaim the tax paid in the UK each year.
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[quote user="Llantony"]Me again!  I know that as a French resident I could fill in a form from the Inland Revenue so as not to pay interest on my UK building society account.  Would it be better to do this and pay tax in France on the interest, or pay UK tax? [/quote]

Hi,

   As a french tax resident you do not have a choice! Your UK building society interest is taxable only in france, and must  be declared here for tax . If you do not declare it the french tax office will eventually be informed of your interest under the EU savings directive exchange of information arrangement, and will want an explanation--they have powers to impose swinging fines(although they may not exercise them if they believe you have acted in good faith)

    Unless you are very wealthy the tax plus social contribution you pay here is unlikely to exceed the 20% taken at source in the UK.

     The only sensible -and legal-course of action is as you suggest above -get your interest paid gross in the UK and declare it here.

     You may wish(when the exchange rate permits) moving at least some of your savings into tax-efficient french Life Assurance (guaranteed € funds)-have a look at  www.fortuneo.fr .

  

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I spoke to the nice guys at Nottingham this week and they informed me that gradually most banks and building societies in the UK are now changing over to the system where the tax is deducted at basic rate and then you have to reclaim it.  We have since leaving France had funds in a building society and they have always but always deducted tax at source I apply to Nottingham for it back and then send it to the Building Society.  Apparently now to pay gross involves them (banks etc) in lots of work brough about  by HMG and most banks and societies as I say are starting to pay net.
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"Apparently now to pay gross involves them (banks etc) in lots of work brough about  by HMG and most banks and societies as I say are starting to pay net." 

Many banks and building societies have for many years refused to pay gross interest to those who live outside of the UK, most of us as Coops posted earlier, have to claim it back and have done since moving to France.  If you have no UK income other than a French declared private pension best way to do it, is to do a UK self assessment tax return.

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[quote user="cooperlola"]There's a special form, Ron (it changes each year).  Mine is at home on my desk so can't get the number in short order but no doubt somebody else knows.[/quote]

We have done this many times before. R43[:)]

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[quote user="cooperlola"]There's a special form, Ron (it changes each year).  Mine is at home on my desk so can't get the number in short order but no doubt somebody else knows.[/quote]

If you have to do a self assessment which I still have to after 6 years away from the UK, there is no need for any other form.  Provided that your savings interest is below your freepay you just get the tax paid back.  You don't have to declare your UK private pension on your SA as that is already taxed in France.  This process is as instructed by the non residents tax office at Bootle and has worked OK for the last 5 years.

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[quote user="Ron Avery"]

[quote user="cooperlola"]There's a special form, Ron (it changes each year).  Mine is at home on my desk so can't get the number in short order but no doubt somebody else knows.[/quote]

If you have to do a self assessment which I still have to after 6 years away from the UK, there is no need for any other form.  Provided that your savings interest is below your freepay you just get the tax paid back.  You don't have to declare your UK private pension on your SA as that is already taxed in France.  This process is as instructed by the non residents tax office at Bootle and has worked OK for the last 5 years.

[/quote]

Your scenario does not work for everyone.

I,and many others, have a pension which is taxed in the UK (a Govt pension)

I pay tax on this pension as it is over my tax allowance.

Therefore if I followed your advice and declared my interest on my building society account I would not obtain any relief on the tax paid.

I have to complete the form to claim back the tax paid.

So it may work for you but does not work for everyone.

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[quote user="Ron Avery"]

[quote user="cooperlola"]There's a special form, Ron (it changes each year).  Mine is at home on my desk so can't get the number in short order but no doubt somebody else knows.[/quote]

If you have to do a self assessment which I still have to after 6 years away from the UK, there is no need for any other form.  Provided that your savings interest is below your freepay you just get the tax paid back.  You don't have to declare your UK private pension on your SA as that is already taxed in France.  This process is as instructed by the non residents tax office at Bootle and has worked OK for the last 5 years.

[/quote]Clearly Ron, things differ slightly according to your circumstances, but the R43 works for me.[:)]
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[quote user="Ron Avery"]Many banks and building societies have for many years refused to pay gross interest to those who live outside of the UK, most of us as Coops posted earlier, have to claim it back and have done since moving to France.  [/quote]This is a good reason - perhaps the only good reason - to move your money to an offshore affiliate of the bank, as long as you are happy with the security of the account.

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