Change to tax form - confirmation of what exactly please

[Judith]

I know there is a long thread on this one, but I gave up trying to understand all the many comments.

Am I correct in thinking that the change discussed refers to government (ie civil service and local authority) pensions, and that the info quoted below here (taken from the FAQs which I see have been recently updated) is what has changed (because it isn't what I had written down from last year!)

"So, on form 2047, your

gross pension goes in section I PENSIONS, RETRAITES, RENTES.

The total then go across to box 1AS (or box 1BS if it’s

your wife’s pension) on the form 2042. Then to get the tax

credit, you enter the gross amount of the pension on form

2047 section VI REVENUS IMPOSABLES DE SOURCE ETRANGER OUVRANT DROIT A

UN CREDIT D’IMPOT EGAL AU MONTANT DE L’IMPOT FRANCAIS

CORRESPONDANT A CES REVENUS then transfer the total across to box

8TK on the form 2042. "

Is this the only change?

We have no rental income from the UK, only bank interest, which I know what to do with, unless that has also changed.

If some one who has better knowledge than I will confirm my presumptions above, I can then get on with completing the form, which I am in the process of doing now.

Thanks

[parsnips]

Hi Judith,

    In your case what you have quoted is correct. ( It's only the gross govt. pension that goes in 8TK. the note you quote is a bit ambiguous on that point).   

[cooperlola]

[quote user="parsnips"] the note you quote is a bit ambiguous on that point).   
[/quote]To be fair to the person who wrote it (not me in this case!) - it's less ambiguous with its preamble.[:)]

[Jay]

[quote user="cooperlola"][quote user="parsnips"] the note you quote is a bit ambiguous on that point).   

[/quote]To be fair to the person who wrote it (not me in this case!) - it's less ambiguous with its preamble.[:)][/quote]

Yeah, I agree. I found the notes easy to understand and very helpful.

[Gardener]

Most people I suspect ( me included) have not received the parthenay letter and some (me included) have been told in writing by our various tax offices to fill the form in exactly the same way as previous years. Isn't it wiser in that case to fill the form in as stated on the form?

If your tax office isn't aware of the changes, then how are they going to know how they should be doing these new calculations?

[stan]

There is also no mention of this on The Connexion`s 2011 Tax Guide.

[Judith]

[quote user="parsnips"]Hi Judith,

    In your case what you have quoted is correct. ( It's only the gross govt. pension that goes in 8TK. the note you quote is a bit ambiguous on that point).   

[/quote]

Parsnips,

Thanks - yes, sorry, I forgot to include the top bit which says it's talking about govt pensions......

[parsnips]

[quote user="Gardener"]Most people I suspect ( me included) have not received the parthenay letter and some (me included) have been told in writing by our various tax offices to fill the form in exactly the same way as previous years. Isn't it wiser in that case to fill the form in as stated on the form?

If your tax office isn't aware of the changes, then how are they going to know how they should be doing these new calculations?[/quote]

Hi,

     If you have been specifically told to do it as before, you'd best do that. But that will leave your tax office , if and when they get up to date, to correct your declaration. So I say again , check your "avis" very carefully when it comes and query any significant increase.  The greatest danger is that your office , more incompetent than the average, will end by taxing the exempt income. I have known this to be done in previous years by our tax office, even without the excuse of a change in procedures.

[audio]

Judith,

With due respect to your OP, I understood from my tax office that UK state pensions should be placed at 2047 VII Revenus exonérés pris en compte pour le calcul de taux effectif.

Are they right or as Parsnips said ‘will end by taxing the exempt income’?

[vmax]

You are correct. The notes on page 3 of the form 2047 in relation to vi do not refer to the UK (many other countries).

I have just had confirmation from my tax office (Prades) that in fact for UK gov. pensions, all that is required is the declaration in vii on form 2047 and 8TI on form 2042 - not 1AS.

[parsnips]

[quote user="vmax"]You are correct. The notes on page 3 of the form 2047 in relation to vi do not refer to the UK (many other countries).

I have just had confirmation from my tax office (Prades) that in fact for UK gov. pensions, all that is required is the declaration in vii on form 2047 and 8TI on form 2042 - not 1AS.[/quote]

Hi,

     Ho,Ho,Ho, here we go!--I have in front of me copies of letters from three tax offices sent me by the recipients which say different; Govt pensions in 2042, 1AS and 8TK , and 2047 VI; as I have said , if you have been told something specific by your tax office --best comply, but be aware that in many case your tax office is going to be wrong, and will no doubt try to put things right at some stage. Given the apparent general state of ignorance and confusion in ,at least a fair number of tax offices, check your eventual demands to make sure that your exempt income has not been taxed in error.

       The UK is not on the list in the 2047 notes because they have obviously not woken up to the changes in time to revise them to comply with the new DTT. That is why (some) tax offices have been sending out their own local (usually badly translated-and in some cases contradictory) letters to UK expats with exempt income.   

[cooperlola]

This subject was discussed at length on another thread after Parsnips allerted the forum to the changes.  I have some input into the tax FAQs on this forum (not this particular bit) and discussed this question at length both in that thread and behind the scenes, before it was finally decided to reflect these changes.  All the real documentary evidence which we have seen indicates that the changes HAVE gone through, hence the amended FAQ.  There is still a lot of dubiety however, not least from the tax offices themselves, and a lack of clarity, especially on the issue of rents.

I think that Parsnips is bang on the money here.  If your tax office insists that the changes have not happened, then of course you must take their advice, but take great care to check their final figures when your Avis comes in and if you are in any doubt as to the veracity of their calculations, then make sure you insist that they justify their figures before you pay them a euro.

[audio]

Parsnips,

You seem to be a bit rattled by recent posts on this subject.

We are not trying to take over from your ‘expertise’ we are just merely trying to help.

I personally have not had a letter from my tax office but my post earlier today was to point out what my tax office told me years ago and the explanation i.e. 2047 VII Revenus exonérés pris en compte pour le calcul de taux effectif. Would appear to be the most likely place to put a UK Gov. Pension.

The other suggested place:

2047 V1 :REVENUS IMPOSABLES DE SOURCE ETRANGER OUVRANT DROIT A UN CREDIT D’IMPOT EGAL AU MONTANT DE L’IMPOT FRANCAIS CORRESPONDANT A CES REVENUS, I consider incorrect for this entry.

No doubt your forthcoming reply will endeavour to crash my input.

[Gardener]

I have just checked over what I have submitted on line earlier this month and I did it the way I always have.

What I have just noticed is that at VII pink form (2047) when completing it online the program ALWAYS automatically deducted the Nature et montant de l'impot eventuellement acquitte a l'etranger from the amount declared in the montant brut du revenu hors cotisations. the net amount would then be entered at 8TI blue form. Although the online fiche stated that it should be deducted as always, the program didn't do that, so the amount I actually entered at 8TI was the brut amount, so whilst claiming I was going to do it exactly the same as previous years, infact the software wouldn't let me! Of course if I had filled the paper version in I would have deducted the tax etc.

So the forms might not be up to speed this year but the impots software is more on the ball!

Audio if you fill yours in online and enter your Gov pension at VII as per usual you will see that the tax isn't deducted as explained above.

[parsnips]

Hi audio,

        I'm not rattled by the fact that some people may doubt my grasp of the subject, what is rattling me is watching the slow development of a confused and chaotic situation for people trying to deal with what is a difficult enough task at the best of times.  It is a fine example of the french bureaucratic machine in (faulty) action, and as such has its amusing elements. The facts are that the new treaty setting out the revised method for avoiding double tax was signed in 2008.  Two years were allowed for tax services to adapt their processes, and it did not come into force till 01/01/2010. Even then it would have no real effect for tax-payers until now, and yet, it is quite obvious from the ad hoc way that individual offices are attempting to deal with it, that this was first noticed about a month ago.  No doubt , as a result of the extra work caused- and to be caused- by their incompetence , the tax-men's unions will be campaigning for more personnel and resources. 

       I have absolutely no doubt that a significant number of people will be wrongly subjected to french tax on their exempt income as a result of this fiasco. So I emphasise --check your "avis" when it comes.

[audio]

Hello Gardener,

Thanks for the info. I still complete the old fashioned way on paper, a hard copy just adds to my ever growing mountain of paperasse. It may not be saving the planet concept but I always include a letter with my tax returns explaining why I entered x at line 4y. ‘Hopefully’ if I make a mistake they will tell me. Wishful thinking? Probably.

Hello Parsnips,

Thank you for explaining the confused and chaotic situation which I am sure many of us were not aware.

Check your "avis" when it comes is very good advice on your part, but will we understand it?

[parsnips]

[quote user="audio"]Hello Gardener,

Thanks for the info. I still complete the old fashioned way on paper, a hard copy just adds to my ever growing mountain of paperasse. It may not be saving the planet concept but I always include a letter with my tax returns explaining why I entered x at line 4y. ‘Hopefully’ if I make a mistake they will tell me. Wishful thinking? Probably.

Hello Parsnips,

Thank you for explaining the confused and chaotic situation which I am sure many of us were not aware.

Check your "avis" when it comes is very good advice on your part, but will we understand it?[/quote]

Hi,

      French tax"avis" seem to be designed to defy comprehension, but a rough guide would be to use one of the tax simulators to work out- A. the tax on your total income , including the exempt parts (rents and/or govt. pensions) and then for- B. only the french taxable part.  If the tax on your demand is approx. the same as B then it's probably corrrect, if it is closer to A. then it's probably wrong ,and tax has been charged on the exempt part.

[audio]

Using a tax simulator. Good suggestion of yours Parsnips and if they also have the facility to translate it would be a great help to many of us!

When I first came over to France, I asked a qualified accountant to complete my tax return, for a small fee of course. I was summoned to the tax office, a short while after filing, to correct (with their help) the many errors he had made.

If a professional can’t cope, what hope do we have?

[Judith]

Caught up with this thread again .... as far as I know we have had no instruction form the tax office, and I wasn't planning to contact them, so do I put the Govt pensions into VI or VII?  Mind you, since it looks as though the tax we paid on (my) govt pensions was only 106€ last year, (they are tiny!) OH finally seems to have got out of the UK system, but I am still trying .... I don't think I'm going to worry about 100€!

However, I now have another question - I have a credit d'impot from Orange (installing our new internet etc last year).

1) where does this go - in 2042/ sect 7, and then where?  I  can find no "sensible" pplace.

2) Do I put the amount we paid or the amount against the term "reduction d'impot"?

Thanks

[suej]

     

 

Parsnips thanks for your advice re doing simulated declarations,  I tried to quote your post but get rejected with it in ...I have just done as you suggested and printed the results off  (with pencil scribbles to remind me what I was doing !)

Result A bumped the amount to pay well  above last year's figure.

Result B took the amount below last year's but that would be accounted for by the difference in the total global figures I suppose.

Anyway it has certainly given me a point of reference to check against in September so thank you again- what a mine of information this forum is!

Sue

 

[Chrissie]

Not sure which of the "tax" threads to put this in, but here goes:

Under the new rules there seems to be no box where you enter the actual amount of the tax you have paid at source on a UK public sector pension.  So how do they know how much to credit you with?  Am I missing a box somewhere?  (Makes me sound like someone who's a sandwich short of a picnic - starting to feel this may be true!)

Chrissie (81)

[parsnips]

[quote user="Chrissie"]

Not sure which of the "tax" threads to put this in, but here goes:

Under the new rules there seems to be no box where you enter the actual amount of the tax you have paid at source on a UK public sector pension.  So how do they know how much to credit you with?  Am I missing a box somewhere?  (Makes me sound like someone who's a sandwich short of a picnic - starting to feel this may be true!)

Chrissie (81)

[/quote]

  Hi,

 The UK tax paid is irrelevant, it was due and paid in the UK . The french tax credit is for the amount of FRENCH tax which would be payable if the pension was taxed in France. There is no box because they don't want to know.

[Chrissie]

Aaaaaaah.[:D]   Of course.

Thanks for saving my sanity.

Chrissie (81)

 

[vmax]

Please also be aware for potential confusion by all including french tax offices differentiating between 'state' and 'government' pensions.

Email to me following a query to Connexion's regarding the 2011 Tax Guide:

'Article 19.2 of the new DTT states that pensions from the government are only taxed in the country from which they are paid.

What will change for government income is that there will be a credit of tax given against the French tax rather than the income being taken into account under the taux effectif system.

The Connexion’s guide has been prepared in accordance with the instructions in both the Notes to all of the forms that come with the forms, and to the Fisc's own Guide on their website. Neither the Fisc's Notes booklets to the tax forms, nor the Fisc's own national website Guide, mention any change in the manner in which these income sources should be declared.'

Hoe this helps...

[vmax]

Further: Section vii on form 2047 deals with exempt income for tax purposes and section vi deals with taxable income of foreign source giving a right to a tax credit equal to the amount of tax.

The Double Taxation Convention, signed by the UK and France in June 2008 coming into force on December 2009 and effective in UK from April 2010 and in France from January 2010, deals with government pensions in Article 19 and states that they are exempt from taxation by virtue of being taxable only in the originating state (unless the resident is a/also a national of the second state). Here is a link to the Convention on the HMRC website:http://www.hmrc.gov.uk/international/france.pdf

One would have to look at the wording of the treaties agreed with the states mentioned in the notes for the form 2047 in order to see if there is a difference relating to 'exempt' or the 'right to tax credits equal to tax paid'...

As said by someone else - the bottom line is do what your local office wants - so long as your government (as opposed to state) pension isn't taxed.