Another Social charges question...

[Nell]

It's Social charges time again and for another year I am completly confused.

OH 67 yrs and has had E121 (S1) since we arrived in 2007 on which I am a dependant. I have now hit the magic 60 so can probably ask for an E121 in my own right (even though the UK government will not let me have my state pension till I reach the ripe old age of 62yrs 6 mths! but that's another story that I am sure you all know about...)

When I check the social charges bill, I see we pay social charges @ 13.5% on the interest we get on UK savings accounts (Box 2TS on blue form). We also pay social charges @13.5% on half of OH's annuity pension (Box 1BW on blue form).

Questions:

1) should we be paying social charges on half of an annuity pension? Other pensions not included.

2) should we be paying social charges on savings as we are not a drain on the health service because of the E121 (the UK pays the bill does it not?)

Then to cap all that we then get some sort of refund off set against "next years Impot bill". That I cannot fathom as it does not seem to be a percentage of anything. Anyone know what this may be please.

I have puzzled over this bill for the last 5 years and I am no further advanced. I would really appreciate some insight into this. The biggest bug bear is that lots of aquaintences say "Oh you should not pay Social charges, we don't!!!!!" Grrrrrr.....

Thanks

[mint]

Well, Nell, I can answer in part.

Yes, we pay contributions sociaux on bank interest (now next to nothing![:)])

And OH pays cs on 60 % of his annuities.  The amount they use for the taxed (I am using the word "taxed" loosely here) part depends on what age the person is when they first take out the annuities.  As OH didn't start taking them out until he was 70, he gets the maximum amount (that is, 40% tax free).

But  I think you only have to be 60 (not sure whether 60 or 65, I forget) to get the maximum 40% tax-free off.

Hope that makes sense.  If not, please say and I will have another go at explaining myself![:)]

[Nell]

Hi Sweets, thanks for your prompt reply. It is now starting to make some sense (clear as in milk rather than mud maybe!!). The annuity seems to be split at 50%, so 50% taxed and 50% used in the social charges calculation. (OH took his annuity at 55). If I knew what the tax percentages were I could probably work out how much of a tax refund we are getting, but I think my head is beginning to hurt now!! I think it seems very strange to take money from you one year and then give it back to you the next, but there we go that's France for you....

Thanks again

[JohnFB]

Part of the 13.5% you are paying on the annuity is C.S.G (8.2%). The credit you are seeing against next years income relates to the the prior year CSG. It is equal to 5.8% of the icome which suffered a CSG charge.

rgds

JFB

[beccyj]

Hi,

I am 65 yrs young and have to pay social charges on my annuity (taken when I was 50). I have read where if you don't pay habitation tax or pay less than 61 euros income tax , you are able to get a reduction on social charges. Because I am on a low income and do NOT pay habitation/income tax, am I able to get the reduction on social charges?  It would be nice if the answer was positive, dare I dream???

beccyj

[parsnips]

[quote user="beccyj"]Hi,

I am 65 yrs young and have to pay social charges on my annuity (taken when I was 50). I have read where if you don't pay habitation tax or pay less than 61 euros income tax , you are able to get a reduction on social charges. Because I am on a low income and do NOT pay habitation/income tax, am I able to get the reduction on social charges?  It would be nice if the answer was positive, dare I dream???

beccyj

[/quote]

Hi,

 AFAIK the exemption only applies to state retirement pensions and invalidity pensions , what you have is a "rente viagere" .   But there would be no harm in asking the tax office.