Avis d'Impot 2013 and UK rent

[mazandcol]

Hi all,

So, we got our Avis d'Impot 2013 today and as I

suspected following my lengthy 'discussion' with the Villeneuve tax

office in May, we have been charged (for the first time) both Tax and

Social Charges on our UK rental income, because it was below the tax

threshold in UK. 

This is contrary to info published in Connexion

31 May (and confirmed to me directly by Connexion since) which stated

the French Tax Authorities had agreed this would not happen.  Here's the

article:

http://www.connexionfrance.com/news_articles.php?id=4762

Either

the Connexion info was wrong, or the decision hasn't got to Villeneuve

yet.  So, it looks like a long, hard battle with the authorities - I just hope I'm up to

it. 

I'm sure we're not the only ones who've had these charges

this year, so how many are we, and is it just Villeneuve/Dept 47 or any

other departments on this forum? 

Now we need to start  REALLY researching how to go about it all...

[Patf]

I've sent you a private message.

[Val_2]

Don't take anything you read in that as gospel. The authorities themselves know better.

[NormanH]

That magazine is so often wrong that it is better known as The Correction. It also has no power.

French tax authorities may make mistakes but are never 'wrong'. They do have power....

[parsnips]

[quote user="mazandcol"]

Hi all,

So, we got our Avis d'Impot 2013 today and as I

suspected following my lengthy 'discussion' with the Villeneuve tax

office in May, we have been charged (for the first time) both Tax and

Social Charges on our UK rental income, because it was below the tax

threshold in UK. 

This is contrary to info published in Connexion

31 May (and confirmed to me directly by Connexion since) which stated

the French Tax Authorities had agreed this would not happen.  Here's the

article:

http://www.connexionfrance.com/news_articles.php?id=4762

Either

the Connexion info was wrong, or the decision hasn't got to Villeneuve

yet.  So, it looks like a long, hard battle with the authorities - I just hope I'm up to

it. 

I'm sure we're not the only ones who've had these charges

this year, so how many are we, and is it just Villeneuve/Dept 47 or any

other departments on this forum? 

Now we need to start  REALLY researching how to go about it all...[/quote]

Hi,

     Judging by the posts on the French Entree forum most people , including those who are below the UK threshold have been correctly exempted from tax and social charges this year.    You should contest your avis on the grounds that the DGI (direction generale des impots) has issued instructions that all UK rents are exempted from IR and Social charges , even if no tax has been paid in the UK after they have been assessed there.   This may have the effect of getting them to check with higher authority.    If they still reject your contestation, then follow all the appeal routes to the end because they ARE wrong and on this occasion (rarely) the Connexion is right.

[nomoss]

I'm trying to get my head around the apparent fact that, if, as a French resident, I rent out a property in the UK, I am not liable to french taxes nor CSG on the rent, even if I don't pay any taxes on this income in the UK, but if I own a similar propety in France I would be laible to both.

If true, I think this is grossly unfair, and should be rectified asap.

 

 

[parsnips]

[quote user="nomoss"]

I'm trying to get my head around the apparent fact that, if, as a French resident, I rent out a property in the UK, I am not liable to french taxes nor CSG on the rent, even if I don't pay any taxes on this income in the UK, but if I own a similar propety in France I would be laible to both.

If true, I think this is grossly unfair, and should be rectified asap.

 

 

[/quote]

Hi,

    It's because supposedly greater brains than ours negotiated the treaty that way.    Real estate is taxable only in the country where it is sited.   The reason it looks odd to you is that french taxes are disgustingly higher than in the UK when you include the so-called social charge , which is just another badly disguised tax.   If it's any consolation to you the treaty also provides for the UK rent to be "taken into account " when calculating your french tax rate, so if you do own a UK rental property you probably do pay a bit more french tax as a result.     Sorry if it still seems unfair to you, but I can only suggest you either join the rest of us on this planet, or you could give what you see as a fair amount of tax to the french tax office benevolent fund. 

[mazandcol]

Hi all,

thanks for all the replies - I've just received a copy of the e-mail sent to Connexion by the DGFIP confirming that we should NOT be taxed on UK rental income.  I hope that will help me...

I'm about to go look at the French Entree forum.

[nectarine]

mazancol .... could you please forward that email from DGFIP to me? Many thanks.

[Chrissie]

I think there are a lot of us who would like the text of that email, if that is possible, please.

Chrissie (81)

[mazandcol]

Hi all,

As requested here's the e-mail from DGFiP to Connexion on 31 May 2013 - Connexion printed this e-mail on Page 5 of their August issue.

From: [mailto:daniel.baldaia@dgfip.finances.gouv.fr

Sent: 31 May 2013 09:53

To: Oliver Rowland

Subject: Re: The Connexion - ma question sur certains types de revenus en provenance de la Grande-Bretagne

 

Notre réponse correspond parfaitement à votre question.

TOUT revenu perçu est à déclarer, revenus mobiliers et pensions y compris, quelles que soit son origine.

Un crédit d'impôt s'appliquera à partir du moment où le revenu correspondant a bien été soumis à l'impôt au Royaume Uni.

C'est très clair.

Autre

chose qui peut vous intéresser, dans les cas où l'impôt est égal à O en

raison d'un abattement obtenu en Grande Bretagne (âge, niveau de revenu

autre...), le crédit d'impôt effaçant l'impôt français est maintenu.

Nous

vous avons indiqué dans le mail précédent comment faire pour les

contribuables qui souhaitent modifier leur déclaration : via compte

fiscal sur internet ou via le centre de leur lieu de résidence, les

agents sont à leur disposition pour aider les contribuables dans leur

démarches.

Daniel Baldaia

[nomoss]

[quote user="parsnips"] I can only suggest you either join the rest of us on this planet,[/quote]

Would you please explain what you mean by that remark, as I don't understand what you are inferring.

 

[quote user="parsnips"] or you could give what you see as a fair amount of tax to the french tax office benevolent fund. 
[/quote]

I don't understand that remark either. We had sold all our property in the UK long before we moved in France.

When we rented out property here we paid a sizeable amount to the french tax office, not their benevolent fund, plus, of course, Social charges.

We eventually decided that the net income was not worth the hassle.

 

 

[NormanH]

It seems reasonable that income from rented property  for people resident in France should be subject to the same taxes and charges wherever that property is situated, though apparently it isn't, as I am sure parsnips knows his onions [:D]

I think the same thing about social charges for health cover. Those who have an S1 don't pay any NI in the UK or any  cotisations here, whereas those who have worked here and have a small French pension which makes them liable do have to pay, and quite a substantial amount.

I feel that all should be treated alike in the two cases.

At one time I was paying charges on  a property I rented out plus social charges for health cover, whereas someone with a place in the UK and an S1 paid nothing on the same income

I feel that all should be treated alike in the two cases.

I realise that this makes me a 'wishful thinker' and perhaps this is the 'other planet' parsnips is referring to...

One where all are treated fairly.

[nomoss]

[quote user="NormanH"]It seems reasonable that income from rented property  for people resident in France should be subject to the same taxes and charges wherever that property is situated, though apparently it isn't, as I am sure parsnips knows his onions [:D]

I think the same thing about social charges for health cover. Those who have an S1 don't pay any NI in the UK or any  cotisations here, whereas those who have worked here and have a small French pension which makes them liable do have to pay, and quite a substantial amount.
I feel that all should be treated alike in the two cases.

At one time I was paying charges on  a property I rented out plus social charges for health cover, whereas someone with a place in the UK and an S1 paid nothing on the same income

I feel that all should be treated alike in the two cases.


I realise that this makes me a 'wishful thinker' and perhaps this is the 'other planet' parsnips is referring to...
One where all are treated fairly.
[/quote]

 

Thank you, Norman, for your balanced response to my posts.

The system does seem to me to have extraordinary anomalies, and some quite arbitrary rules, but doubtless that is due to my lack of a "great" brain [:(]

People inside the system are so used to its quirks that they don't realise outsiders can be baffled; some years ago a tax inspector here in France, with whom I was discussing, via email, a mistake I had made on my first return after we retired, asked me if we were covered by French Social Security.

The question seemed to be totally irrelevant to the discussion, and I told him that we were covered by CPAM.

A few days later, after studying the rules, I realised why he had asked the question, and wrote again to tell him we are covered via our E121's (so we are not directly covered by French system).

This caused an even bigger delay in sorting out our taxes, but we got there in the end[:D]

 

I fear that the percentage of people who think they are being treated unfairly is far too small to have a voice, but woe betide any of them who shall bring down the wrath of the righteous on their heads if there is any suggestion they might be doing something wrong with their cars or driving licences![6]

 

 

[parsnips]

[quote user="nomoss"]

[quote user="parsnips"] I can only suggest you either join the rest of us on this planet,[/quote]

Would you please explain what you mean by that remark, as I don't understand what you are inferring.

 

[quote user="parsnips"] or you could give what you see as a fair amount of tax to the french tax office benevolent fund. 

[/quote]

I don't understand that remark either. We had sold all our property in the UK long before we moved in France.

When we rented out property here we paid a sizeable amount to the french tax office, not their benevolent fund, plus, of course, Social charges.

We eventually decided that the net income was not worth the hassle.

 

 

[/quote]

Hi,

       I  thought you were writing as a current  renter of UK property, so in my first remark I implied that anyone who argued to pay more tax must be somewhat detached from reality.    I now see that you are in fact only in favour of other people paying more tax  . I would like to know in what way that , if it came about ,  would give you pleasure.

        As above , I thought you were saying that you didn't think you were paying enough taxes , but again , I now realise that it is other people who you think should pay more.  I suggested the benevolent fund as I don't think even the french have a mechanism for paying taxes which don't exist.   The reason that the tax you favour on UK rents, received by french residents, does not exist is because it is explicitly ruled  out by the double taxation treaty negotiated on your behalf by the UK government.   If the thought of some people still benefiting, to some extent, from the more reasonable tax policy of the UK, as opposed to the draconian impositions of the government of the country in which , I assume , you freely chose to live, then I can only suggest you take it up with the UK treasury.

[nomoss]

I did not say, nor infer that anyone should pay more taxes. Only that all should be treated similarly and fairly.

Your ability to misrepresent and twist meanings is as amazing as your inability to read and understand without jumping to conclusions formed by your prejudices.

 

 

[parsnips]

[quote user="nomoss"]

I did not say, nor infer that anyone should pay more taxes. Only that all should be treated similarly and fairly.

Your ability to misrepresent and twist meanings is as amazing as your inability to read and understand without jumping to conclusions formed by your prejudices.

 

 

[/quote]

Hi,

 Thank you for your succinct character analysis  . I will try harder in future.

(By the way, the speaker implies , the listener infers.  I learned this from the pedantic Sheldon Cooper on the Big Bang Theory)

  

[nomoss]

I'm so pleased at that, and thank you for the English lesson[:)]

However, I do try not to base my use of English on what is received from American TV programmes.

Where the word is used colloqually, my Oxford dictionary disagrees [:(]

 

 

[Daft Doctor]

Hi, I received my Avis today and although our UK property income in 2012 was way above UK tax threshold and even though a full tax credit was given against this income in the Avis, full social charges of 15.5% were levied against the income, in our case an overcharge of over 4,000 euros!

I have emailed our french accountant about this and it seems from what has been said earlier in the thread that we have indeed been wrongly levied social charges on the income. Can anyone advise? How does one go about challenging this mistake? Is there a definitive statement which I can refer to if I go down to the impôts and challenge this directly? Any help gratefully offered, it is 4,000 euros I'd rather not have to pay up first then fight the Impôts for it back.

against

[NormanH]

"the more reasonable tax policy of the UK, as opposed to the draconian

impositions of the government of the country in which , I assume , you

freely chose to live"

The free choice to live in France might be considered as  allied to the responsibility to adhere to its social charges, since those who have  chosen to live here benefit from the system they don't pay for.

That free choice should include acceptance of the taxes and charges paid by French people in the same situation.

It is time that the loopholes which allow people to escape those responsibilities were closed

[nomoss]

[quote user="NormanH"]"the more reasonable tax policy of the UK, as opposed to the draconian impositions of the government of the country in which , I assume , you freely chose to live"
The free choice to live in France might be considered as  allied to the responsibility to adhere to its social charges, since those who have  chosen to live here benefit from the system they don't pay for.
That free choice should include acceptance of the taxes and charges paid by French people in the same situation.

It is time that the loopholes which allow people to escape those responsibilities were closed


[/quote]

We seem to agree, Mr H [:)] especially regarding acceptance of the taxes and charges paid by French people. So many Brits always seem to want their cake and eat it.

parsnip earlier remarked that I am “only in favour of other people paying more tax”, which was not what I had in mind when I made my remarks about the tax treatment of rent received by French residents on property which they own in the UK..

 

I am however in favour of people in the same situation in the same country paying the same tax on similar income as I and others do.

 

People in similar circumsances should contribute similarly to the funds of the country they live in, while not being penalised by being taxed twice on the same income.

 

The concession eventually obtained and much rejoiced over seems to me to depend on a semantic argument based on the wording of the Treaty, not on its intention, which is to avoid taxing people twice, not to enable them to avoid being taxed twice.

 

I remember a similar argument about double exemption being put forward by a French tax official quite early in the debate.

 

I wonder how many of those deploring the tax positions of Amazon et al. find no contradiction in their own avoidance of paying taxes and charges sociales in France[8-)]

 

For parsnip’s benefit, I’m not for a moment suggesting that anyone should contribute “a fair amount of tax to the french tax office benevolent fund”, but I am suggesting that it will only be a matter of time before this interpretation the Treaty is corrected. 

 

 

[Daft Doctor]

I just want to be treated correctly as the rules stand at present and not fall victim of inconsistency and the misguided whim of a tax official.  It isn't a case of whether the rules are right or wrong or fair or unfair, at an individual level it is simply a need to see that the rules have been correctly applied.

I chose to live in France because it is a fantastic place to live and so far I don't regret it one bit.  If the rules changed tomorrow and I had to pay social charges on all my income it wouldn't change my view, I'd just have to pull my belt in a bit more and get on with it.     

[Aly]

[quote user="Daft Doctor"]Hi, I received my Avis today and although our UK property income in 2012 was way above UK tax threshold and even though a full tax credit was given against this income in the Avis, full social charges of 15.5% were levied against the income, in our case an overcharge of over 4,000 euros!

I have emailed our french accountant about this and it seems from what has been said earlier in the thread that we have indeed been wrongly levied social charges on the income. Can anyone advise? How does one go about challenging this mistake? Is there a definitive statement which I can refer to if I go down to the impôts and challenge this directly? Any help gratefully offered, it is 4,000 euros I'd rather not have to pay up first then fight the Impôts for it back.

against[/quote]

Daft Doctor this has also been my understanding. I hope someone is able to respond with the proof you need.

A couple of other points. I think we are all entitled to challenge tax systems and to compare them to others. We do not have to blindly accept everything that is French because we are expats. If you live in France be part of it challenge what you don´t like. France has more tax collectors then the US, yet the system is a  bureaucratic nightmare. Problems raised here seem largely to be the result of the huge variance in interpretation of tax law from one tax office to the next. If the rule is you pay social charges then fine apply the rule uniformly in the same way across the country.

As for looking for loopholes, many French do exactly the same. And many foreigners living in the UK do as well.

[NormanH]

Of course and this is in no way a personal thing.

There are two issues..

I) the present legal situation which parsnips knows about and which you have every right to have applied to your case

2) The opinions about this which nomoss and I have (and  equally have a right to) but which we can hardly expect to find favour in a Forum such as this where the majority of  British French residents would benefit from the status quo..

[nomoss]

[quote user="NormanH"]Of course and this is in no way a personal thing.

There are two issues..
I) the present legal situation which parsnips knows about and which you have every right to have applied to your case
2) The opinions about this which nomoss and I have (and  equally have a right to) but which we can hardly expect to find favour in a Forum such as this where the majority of  British French residents would benefit from the status quo..
[/quote]

 

Which rather strangely (not to say inconsistently) seem to almost exactly correspond with the opinions of many people in the UK regarding the activities of Amazon et el.