French tax on NHS pension lump sum?

[Sprogster]

I am not talking about IFA's or their firms, who should not be giving tax advice, but specialised tax lawyers and accountants. However they rarely advertise, never give investment advise or recommendations and are usually part of the larger law and accountancy practices in London, Paris and the South of France. If you have sufficient net worth to fall into the French wealth tax band, which includes your pension pot, then in my humble opinion you should be getting specialised advice. With no disrespect, I would doubt that many posters on this forum fall into this category, so Daft Doctor is untypical in this regard, as the wealthier you are the less attractive France tends to be as a permanent retirement destination.

[Sprogster]

parsnips, it depends on what you define as being rich. A professional person such as a doctor, accountant or lawyer at partner level in the UK, will almost certainly be on a healthy six figure renumeration, and therefore can easily accumulate assets and build a pension pot over their career that takes them well into the French wealth and exit tax band.  

[parsnips]

[quote user="Sprogster"]parsnips, it depends on what you define as being rich. A professional person such as a doctor, accountant or lawyer at partner level in the UK, will almost certainly be on a healthy six figure renumeration, and therefore can easily accumulate assets and build a pension pot over their career that takes them well into the French wealth and exit tax band.  [/quote]

Hi,

    If you read the details of the "exit tax" you will see that it is aimed at french nationals owning blocks of shares worth over 1.3million € in (usually their own) businesses with at least 1% of the total shares issued for that company. Not many UK retirees , even rich doctors, will fall into that category.   By the way it was the doctor who said that his wealth was being over- estimated by posters here .(his post today 0.32).

[Sprogster]

Parsnips, it may be aimed at those people, but the French Fisc cannot discriminate by nationality under EU rules, so in practice it will be applied to anyone that meets the net worth requirement. Although in reality there are probably not that many Brit expats permanently resident in France that meet the criteria, as many leave within the time constraint and France is not exactly a favoured permanent resident destination for the wealthy, other than as second home owners.

[Mikep]

I'd take issue with Sprogster's point that France is an unfriendly tax environment for retirees. I've been here since retiring fifteen years ago and find the tax treatment is much kinder than it would be in UK. Two main reasons - pension income is not subject to socialist contributions, and a couple are taxed as a family rather than individually. Our marginal tax rate on a reasonable income is 14%, and the overall just over 3 (three!) percent. It would be 25% marginal and well over 10% in UK.

I have some dividends and bank interest which are loaded with CSG as well, but that's not much of a problem at the moment.

Just wanted to mention it in case there are readers in UK getting the wrong impression.

[Daft Doctor]

Looking purely at the income tax situation, I have estimated that by virtue of my NHS pension being taxable in France rather than in the UK and having UK property income to soak up our UK personal tax allowances, our net income will increase by over 7%.  That doesn't sound too bad to me!