When do you actually become a French resident?

[Nessie]

This may seem an odd question but what are the actual criteria that determine when you become a French resident? I've been paying all the usual taxes etc for the house we bought 2 years ago but intend to move over permanently soon.  We'll probably keep an English address (currently living with daughter) and I have an English pension paid into an English bank account and will presumably pay English income tax.  However, I don't want to keep sitting on the fence if it penalises us in some way and we lose eligibility for things we would have had if we were officially French residents.

I suppose most readers have been through this themselves but with changes to the health service causing confusion, I wonder if there are any other issues emerging that may also change the situation.

Thanks,

Alan D

[Will]

This recent topic might help http://www.completefrance.com/cs/forums/1175899/ShowPost.aspx

[Sunday Driver]

A good starting point would be to consider the French tax office definition of residency.  In simple terms, you are considered to be tax resident in France if your principal residence is here, or you live here with your family, or your main occupation/employment is here, or your centre of economic interest is here.  So, in your case, you will become tax resident here the day you move into your French house to live on a permanent basis - ie, it becomes your home.

You should find it quite beneficial - if your joint income amounts to less than around 20,000€, you will probably find you'll pay no income tax at all.  You will be subject to social charges on any savings/investment income, but the net overall effect is that you'll probably be better off being taxed in France.  Once you're in the French tax system, you apply to HMRC for a refund of all your UK tax paid since you arrived here - a welcome windfall....

As a French resident, you also qualify for any available reductions in your property taxes, dependent upon your age, circumstances and income.

Having left the UK, you'll no longer be covered by your EHIC for any medical treatment whilst in France, so you will also need to arrange your heathcare cover from day one - you can find further details of the procedure in the healthcare section of the forum.  Your 'day one' residency is most important in terms of starting the clock for your five year permament residency status which is necessary for admittance to the state heathcare system.

You will also need to transfer the registration of your car to France - the benefits are that you'll no longer have to pay any UK vehicle excise duty, the French 'MOT' is bi-annual and insurance costs are generally lower here.

In summary, you don't have any choice over your residency, but there are plenty of benefits to be had....

 

 

[Nessie]

Very interesting.  Many thanks.  My position is that I'm on a teacher's pension which is taxed in the UK.  I was assuming that this was something I couldn't change. The thought of getting all my tax back after I transfer sounds too good to be true but isn't there a minimum qualifying period?  I think I'm reasonably au fait with car ownership and health.

Alan D

[Will]

Under the present UK/France double taxation agreement, certain public service pensions, and I understand that includes most teachers' pensions, are taxed in the country where they are paid, so you will not be able to change that. But under the French residence rules you will be fiscally resident in France, as SD says. That means you have to declare your pension on your French tax form, but you put it in the box for income on which tax has already been paid so you do not get taxed again.