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Declaring foreign bank accounts


richyrich2
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JohnRoss: in answer to your first question, I think the French is not completely clear. Does it mean any account that was **opened** during the year, or any account that was **open** at any time during the year?

It would be interesting to know, but why take a risk? You can't go wrong by reporting it in either case.

And – in either case – I'm quite sure that your accountant was wrong. Whether or not you took money from it doesn't affect the need to report it.
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I agree the French is not clear but if it does mean opened then that would make some sense as they ask when an account was closed during the tax year as well. So by implication that would suggest that they do in fact mean opened. Which then would suggest that the accountant was right. However maybe they mean open i.e. existing. All other accounts held by us are declared each year as they are not only open but active .i.e. money in or out or transfered etc. I think I did include it on the 3916 a few years ago but nothing has changed other than it reducing in value further due to market forces. I see that I was banging on about this here in 2009 and it is still not clear what they want from us, I hate this time of year. Having looked back I see that we had one accountant for the first two years and another for the next and they were both clear on this point but what do I know maybe they were both wrong!..................JR
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But if it was opened during the year then, automatically, it was open at some time during the year…

This is getting a bit academic, I suppose.  But, either way, if your accountant said that you needn't report it "because nothing was taken from it," then I think he was wrong.  Nothing in the reporting rule excludes an account just because it was dormant.

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I am even more confused now! On looking back at stuff when we used an accountant for the first 3 years we were in France it is clear that they did not put our Lombard Bond on the 3916 form, only our UK bank account and our UK building society account. The Lombard bond says assurance vie on it and maybe assurance vies are not put on the 3916? Our CMI bond, also assurance vie, from which we take money every quarter by sale of units has the profits, I assume, declared every year on the 2042 and 2047in line CH as instructed so to do by Siddalls.

 The CMI bond also does not appear on the 3916. The thing is this, is the existence of an assurance vie declarable on 3916 as bank accounts and various types of savings accounts like building societies are? Surely, as the accountant implied to us, an assurance vie bond that has no activity in terms of money in or out and which, as I have said before, has made a loss and no gain and was put in place before we moved to France is of no interest to the tax man?  Help!.............JR 

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[quote user="JohnRoss"]

I am even more confused now! On looking back at stuff when we used an accountant for the first 3 years we were in France it is clear that they did not put our Lombard Bond on the 3916 form, only our UK bank account and our UK building society account. The Lombard bond says assurance vie on it and maybe assurance vies are not put on the 3916? Our CMI bond, also assurance vie, from which we take money every quarter by sale of units has the profits, I assume, declared every year on the 2042 and 2047in line CH as instructed so to do by Siddalls.

 The CMI bond also does not appear on the 3916. The thing is this, is the existence of an assurance vie declarable on 3916 as bank accounts and various types of savings accounts like building societies are? Surely, as the accountant implied to us, an assurance vie bond that has no activity in terms of money in or out and which, as I have said before, has made a loss and no gain and was put in place before we moved to France is of no interest to the tax man?  Help!.............JR 

[/quote]

Hi,

 Life insurance linked bonds are treated as french life assurance for tax purposes (very favourably) , and you should put details in box 8TT, (including the date you subscribed to the bond).    When you do take withdrawals , or cash-in the bond , only the gains are taxable, pro -rata for part withdrawals, at your marginal rate; if you have held it over 8 years there is a tax-free allowance of 4 600€ (single) and 9 200€ (couple) .

     Full cash-in gains are easy to calculate - but remember to take € values  at each point;  part -withdrawals are more difficult; see here;

"

Fiscalité sur les rachats

En cas de rachat partiel ou total, seuls les revenus (intérêts

ou plus-values) sont soumis à l'impôt. Pour un rachat total, les revenus

sont déterminés par la différence entre la valeur de l'épargne acquise

et les versements effectués. Pour un rachat partiel, les revenus sont

déterminés par la proportion entre les versements et le capital obtenu.

Cela se calcule par la formule suivante :

Base de calcul = Rachat - (Versements × Rachat) / Valeur

Avec :

• Rachat = montant du rachat partiel

• Versements = total des primes versées à la date du rachat

• Valeur = valeur totale du contrat à la date du rachat.          "

    Gains on Life Assurance Bonds are declared at 2042   Boxes ; 2CH and 2CG;  If you want help declaring when you do make a withdrawal, you can PM me if you wish.

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[quote user="JohnRoss"]Surely, as the accountant implied to us, an assurance vie bond that has no activity in terms of money in or out and which, as I have said before, has made a loss and no gain and was put in place before we moved to France is of no interest to the tax man? [/quote]

It's probably wrong to think that the tax man is only interested in accounts that might produce taxable income. 

I think it's very likely that he is interested in any account outside France which might be useful for concealing tax evasion, buying or selling drugs, financing terrorism, or any other nefarious activities.

Since you are not guilty of any of these things, I recommend you play safe and declare everything.  After all, they aren't asking you to disclose transaction details, only the existence of the account.  

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[quote user="allanb"]

After all, they aren't asking you to disclose transaction details, only the existence of the account.  

[/quote]

I'm not sure the Tax people have the power to do that, but the banks certainly do. In order for Tax evasion to be taken seriously, then there is going to have to be collusion between the tax authorities and the banks

From next year, the banks across the Euro Zone will be even more transparent. So, any bank in any country can ask any other bank to review their account information. So, even if there has not been a transaction from Bank B to Bank A, Bank A can still ask to see the accounts for Bank B to match the names of account holders.

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You put a mark in box 8UU on form 2042 (on the normal version of the form it's the very last item.)  You give the details separately, and there is a form for the purpose: nº 3916.  I don't think they normally send it out with the 2042 etc, but you can download it; or, if you declare online, you can complete 3916 on line also.

But you don't have to use form 3916; you may make a simple declaration on plain paper (papier libre).  Personally I find this a lot easier.

For many years I have declared 2042 and 2047 on line – not forgetting box 8UU – but mailed the bank details later, with a covering note quoting my tax i/d.  It's never been questioned. 

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I have looked at the on-line forms and for sure one does fill in a 3916 for Bank accounts and I assume Building society accounts, most of them are banks now anyway! However for bonds linked to assurance vie contracts the notes say the following: 

 
"Comptes bancaires à l'étranger : vous avez ouvert, utilisé ou clôturé des

comptes bancaires à l'étranger, remplissez la déclaration annexe n° 3916 et

cochez la case 8UU de votre déclaration."

 
"Contrat d’assurance-vie : si vous

avez souscrit, modifié ou dénoué un contrat d’assurance-vie auprès d’un

organisme établi hors de France, cochez la case 8UT et mentionnez dans la

rubrique «autres renseignements», les références de ce contrat, ses dates

d’effet et de durée ainsi que les avenants et opérations de remboursement

relatifs à ce contrat. Attention : vous devez déclarer vos comptes bancaires et

contrats d’assurance-vie à l’étranger sous peine d'amendes."
 
"Bank accounts abroad:

You have opened
, used or closed bank accounts abroad, complete

the
Schedule No. 3916 and check

the
box 8UU of your return

statement."

"Contract of life insurance: if you subscribe, modified or settled a life

insurance
contract with an

organization established outside
of France, check the box 8UT and mention in

the "
other information",

references
in this contract, its effective

dates
and duration as well

as any amendments and refund

transactions
related to this

contract
. Warning: you must declare your bank accounts and

life insurance policies abroad,

fines apply."
 
Now there is a box 8UT but most folk I have talked to one way or another seem to think you cross box 8TT. It does not look as if you give details of start date and company name etc on 3916 for assurance vies however I note that there is a page after you fill in the on-line 2042 for bringing stuff to the attention of the tax man. They carry forward what ever you put last year like holding an E121(S1) although your age if stated would be a year out and would need modifying so I guess this is where you put stuff about assurance vies? The notes alongside 8UT say:
 
Plus-values connues en report d'imposition non expiré. Si montant est

inexact, corrigez case 8UT

 
"Capital gains tax

deferral
known unexpired. If the amount is incorrect,

cross
box 8UT." Any thoughts folks?.....................JR 
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Can't bear this any longer......

JohnRoss - I honestly think you need to up your medication! Rarely have I seen such an enormous mountain out of a molehill!

Just declare them! The fines for not doing so are huge and the penalties can include imprisonment. The French fisc are getting really hot on this so stop mucking about and tying everyone in knots!

Chiefluvvie
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I apologize; I had forgotten that your question referred to assurance vie contracts as well as bank accounts.  I agree, 8TT would be the right box to tick for an assurance vie.  

As far as 8TT and 8UU are concerned, I think Chiefluvvie is right. What they're after is disclosure.  If you fail to disclose something that should be disclosed you may be in trouble for hiding it, but I cannot believe you will be in trouble if you honestly disclose its existence but just tick the wrong box.    

However, for my own nefarious purposes, I would like to understand the reference to 8UT: it apparently refers to tax deferred on capital gains brought forward.  There's no obvious connection with a foreign assurance vie contract.  Where can I find the note that mentioned this?

By the way, an assurance vie contract is not the same thing as life insurance – it's roughly what used to be (maybe still is) called an insurance bond in the UK.  Just to complicate the issue.

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"Where can I find the note that mentioned this?"

On each page of the on-line declaration 2042 or 2047 forms there is a box marked Notice, often a pdf file, which when clicked gives further information and the last bit I mentioned is on the paper version of the 2042 form.......JR
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We're moving a bit off-topic here but I would like to find out exactly what box 8UT refers to.

It seems clear that 8UU refers to foreign assurance vie contracts, and 8TT refers to other foreign accounts.  Here's a clear statement from the government website (it's what appears when you click on "Notice"):

Si vous êtes titulaire d'un contrat d'assurance-vie conclu auprès d'un établissement établi hors de France ou de comptes bancaires à l'étranger, vous devez les déclarer sous les rubriques 8TT et 8UU.

I can't see any connection between those and box 8UT.  JohnRoss: you quoted this –

Contrat d’assurance-vie : si vous avez

souscrit, modifié ou dénoué un contrat d’assurance-vie auprès d’un

organisme établi hors de France, cochez la case 8UT…

You said

that was on the paper form.  I haven't found it on the one I received,

but there are different versions of 2042.  Wherever it is, I wonder

whether it could be a misprint.  Such things do happen.

The caption for 8UT in the declaration is Plus-values en report d'imposition non expiré connues.  I think that means "all known capital gains on which tax has been deferred and has not yet expired" – but I still don't know what it refers to.  The word "foreign" isn't mentioned, and there's no apparent connection between it and the other two. 

Does anyone know what kind of thing would need to be declared here?  Could it be that unrealized gains in an assurance vie contract need to be declared?  I hope not – I've never done it.

 

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[quote user="allanb"]We're moving a bit off-topic here but I would like to find out exactly what box 8UT refers to.

It seems clear that 8UU refers to foreign assurance vie contracts, and 8TT refers to other foreign accounts.  Here's a clear statement from the government website (it's what appears when you click on "Notice"):

Si vous êtes titulaire d'un contrat d'assurance-vie conclu auprès d'un établissement établi hors de France ou de comptes bancaires à l'étranger, vous devez les déclarer sous les rubriques 8TT et 8UU.

I can't see any connection between those and box 8UT.  JohnRoss: you quoted this –

Contrat d’assurance-vie : si vous avez

souscrit, modifié ou dénoué un contrat d’assurance-vie auprès d’un

organisme établi hors de France, cochez la case 8UT…

You said

that was on the paper form.  I haven't found it on the one I received,

but there are different versions of 2042.  Wherever it is, I wonder

whether it could be a misprint.  Such things do happen.

The caption for 8UT in the declaration is Plus-values en report d'imposition non expiré connues.  I think that means "all known capital gains on which tax has been deferred and has not yet expired" – but I still don't know what it refers to.  The word "foreign" isn't mentioned, and there's no apparent connection between it and the other two. 

Does anyone know what kind of thing would need to be declared here?  Could it be that unrealized gains in an assurance vie contract need to be declared?  I hope not – I've never done it.

 

[/quote]

Hi,

   I believe 8UT refers to a system now superceded whereby if an investment fund was taken over and the investor received new shares / units in the new fund , this was assessed for capital gains as if it was a disposal, but the payment was held over till the shares / units were finally sold.  The amount owed would appear pre-printed at 8UT until paid .     For several years now, in those circumstances no disposal is deemed to have taken place, the investor himself, is supposed to keep all the records back to the initial investment and when he sells to use the original acquisition price.

    

  

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Hi no it is on the on-line form allanb. If you go to the gouv site and log in with your 3 numbers and call up the 2042 form as if you were going to fill it in there is a little panel with the word Notice in each section of the form which when clicked gives more information about that section, same with the 2047 form.......JR

PS Waiting for the rain to stop as each time it gets heavy the line stops working and we lose Internet and phone. Been reported before but typical the fault ain't there by the time they get around to looking for it! Must be a junction box up a pole somewhere filling up! Dare not start filling in the form as could drop out anytime and has done several times today and yesterday and SFR are not responding as is a bank holiday I guess, what a shower literally!

 

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[quote user="JohnRoss"]Hi no it is on the on-line form allanb. If you go to the gouv site and log in with your 3 numbers and call up the 2042 form as if you were going to fill it in there is a little panel with the word Notice in each section of the form which when clicked gives more information about that section, same with the 2047 form.......JR[/quote]Sorry.  But you did say "… and the last bit I mentioned is on the paper version of the 2042 form."

Anyway, let's not waste time on that, because even in the online declaration, what I see when I click on "Notice" is not what you quoted.  I've copied it in full, below***.   The button I'm clicking on is the only "Notice" button in the section called "Divers", which includes the boxes from 8BY to 8UU.

The box we're talking about (8UT) is on the second line in that section.  Immediately after it there is a subheading:

Personnes domiciliées en France percevant des revenus à l'étranger

– and after that there are more boxes including 8TT and 8UU.  So, as I said, there's no apparent connection between those two boxes and 8UT.

The mystery continues.  Clicking on "Notice" can evidently produce different results, and I'm fairly sure that the part you saw contains an error.  But Parsnips' explanation makes sense, and reassures me that there's nothing I ought to have declared in 8UT.  

 

*** Si vous êtes titulaire d'un contrat d'assurance-vie conclu auprès d'un établissement établi hors de France ou de comptes bancaires à l'étranger, vous devez les déclarer sous les rubriques 8TT et 8UU.

Le défaut de déclaration d'un contrat d'assurance-vie souscrit à l'étranger est passible d'une amende de 25 % des versements effectués sur ce contrat. Lorsque le Trésor public n'a subi aucun préjudice, le taux de l'amende est ramené à 5 % et son montant plafonné à 1 500 €.

Le défaut de déclaration d'un compte bancaire à l'étranger est passible d'une amende de 1 500 Euros qui peut être portée à 10 000 Euros lorsque le compte est détenu dans un État ou territoire non coopératif (qui ne permet pas l'accès aux informations bancaires).

Ces amendes peuvent sous certaines conditions être majorées (CGI art. 1649A, 1649AA et 1766).

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