I.S.F.

[Chancer]

There was an interesting program on the box last night about charges patronale and the ever increasing number of  French businesspeople who are expatriating themselves to Belgium and Luxembourg, some were even buying and composting TGV tickets to their new home whilst  never actually leaving their Paris residences.

They also showed many (IMHO) injust cases of I.S.F concentrating on retired paysans who had lived and worked all their life on isle de ré but were now having to sell family assets to pay in one case €17000 p.a. I.S.F.

Given the relatively low (by todays standards) I.S.F. threshold of (IIRC) €732,000 and that the value of ones principal residence is included I would like to know if pension pots and other investments are counted.

Does anyone know or have a link to somewhere showing the rates? 

[parsnips]

[quote user="Chancer"]

There was an interesting program on the box last night about charges patronale and the ever increasing number of  French businesspeople who are expatriating themselves to Belgium and Luxembourg, some were even buying and composting TGV tickets to their new home whilst  never actually leaving their Paris residences.

They also showed many (IMHO) injust cases of I.S.F concentrating on retired paysans who had lived and worked all their life on isle de ré but were now having to sell family assets to pay in one case €17000 p.a. I.S.F.

Given the relatively low (by todays standards) I.S.F. threshold of (IIRC) €732,000 and that the value of ones principal residence is included I would like to know if pension pots and other investments are counted.

Does anyone know or have a link to somewhere showing the rates? 

[/quote]

 Hi,

 You can google -ISF assiette -for general information. All capital is included, and when I googled -ISF capital versée pour rente viagere-I found an AVIP (life assurance co) site which says that where a rente viagere is in payment (this is the equivalent of a UK private pension), then each year the capitalised value of the pension has to be calculated (in France this is done by the Assurance Co) and declared for ISF.

[suein56]

[quote user="Chancer"]

Does anyone know or have a link to somewhere showing the rates?

[/quote]

There is this: for 2009

Look under barème et nouveautés en 2009

Le seuil d'imposition passe de 770 000 à 790 000 euros. Les autres tranches du barème ont été actualisées. 

Fraction de la valeur nette taxable du patrimoine	Tarif applicable (en %)
N'excédant pas  790 000 €	0
Comprise entre  790 000 € et 1 280 000 €	0,55
Comprise entre  1 280 000 € et 2 520 000 €	0,75
Comprise entre 2 520 000 € et 3 960 000 €	1,00
Comprise entre 3 960 000 € et 7 570 000 €	1,30
Comprise entre 7 570 000 € et 16 480 000 €	1,65
Supérieure à  16 480 000 €	1,80

[Pickles]

[quote user="Chancer"]They also showed many (IMHO) injust cases of I.S.F concentrating on retired paysans who had lived and worked all their life on isle de ré but were now having to sell family assets to pay in one case €17000 p.a. I.S.F.[/quote]

Putting this in perspective, this means that they have assets worth around €3 million ...

[quote user="Chancer"]Given the relatively low (by todays standards) I.S.F. threshold of (IIRC) €732,000 and that the value of ones principal residence is included[/quote]

The value of the principal residence is reduced in the ISF calculation (I seem to recall 20% reduction is applied)

[quote user="Chancer"]I would like to know if pension pots and other investments are counted.[/quote]

I was under the impression that certain types of fund were not included - perhaps some Assurance Vie contracts?

I was also under the impression that the govt had introduced a "cap" - ie an upper limit on how much the cumulative tax of all types could be as a percentage of your income (or was I dreaming when I read that?)

ISF would be perhaps a little bit more palatable if it were not for the fact that under-declaration of property values is rife - particularly amongst the politicians. IIRC, didn't one of the socialist politicians have a rather nice property on the Cote d'Azure that was valued for ISF purposes at around 50K €, the sum for which it was purchased around 25 years ago?

Regards

Pickles

[parsnips]

Hi,

 The reduction for the principal residence is now 30%.

 Where a life assurance policy has been officially "accepted" by the beneficiaries, and the policy holder cannot make withdrawals, it is exempt, except for premiums paid after the age of 70.

In "contrats de capitalisation", only the sum of the premiums is liable , all capital gains are exempt for the life of the contract.

The"bouclier fiscal" restricts the total amount of all taxes to 50% of income.

[lacote0_0]

[quote user="Chancer"]

Given the relatively low (by todays standards) I.S.F. threshold of (IIRC) €732,000 and that the value of ones principal residence is included I would like to know if pension pots and other investments are counted.

[/quote]

Pension funds not yet in payment, whether French or overseas, belonging to a French domiciliary would normally be subject to ISF.

However, there is an exoneration in article 885 A 1  in respect of assets outside France for the first 5 years after becoming

fiscally domiciled in France.

Toutefois, les personnes physiques mentionnées au premier alinéa qui

n'ont pas été fiscalement domiciliées en France au cours des cinq

années civiles précédant celle au cours de laquelle elles ont leur

domicile fiscal en France ne sont imposables qu'à raison de leurs biens

situés en France.

Cette disposition s'applique au titre de chaque année au cours de

laquelle le redevable conserve son domicile fiscal en France, et ce

jusqu'au 31 décembre de la cinquième année qui suit celle au cours de

laquelle le domicile fiscal a été établi en France.

Rentes viageres (purchased life annuities) in payment are normally capitalised by multiplying them by a multiplier dependent on the beneficiary's age and set out in tables published by the fisc. ISF is then assessed on the capital amount.

There is however an exoneration  for rentes viageres deriving from foreign pension

funds which fall within a very specific definition in article 885 J of the tax

code:

La valeur de capitalisation des

rentes viagères constituées dans le cadre d'une activité professionnelle ou

d'un plan d'épargne retraite populaire prévu à l'article L. 144-2 du code des assurances, moyennant le versement de primes

régulièrement échelonnées dans leur montant et leur périodicité pendant une

durée d'au moins quinze ans et dont l'entrée en jouissance intervient, au plus

tôt, à compter de la date de la liquidation de la pension du redevable dans un

régime obligatoire d'assurance vieillesse ou à l'âge fixé en application de l'article L. 351-1 du code de la sécurité

sociale, n'entre pas dans

le calcul de l'assiette de l'impôt.L'exonération bénéficie au souscripteur et à

son conjoint.

Jusqu'au 31 décembre 2010, la

condition de durée d'au moins quinze ans n'est pas requise pour les contrats et

plans prévus aux articles L. 3334-1 à L. 3334-16 du code du travail, L. 144-2 du code des

assurances et au b du 1 du I de l'article 163 quatervicies du présent code, lorsque le souscripteur y adhère

moins de quinze années avant l'âge donnant droit à la liquidation d'une

retraite à taux plein.

Even if the exoneration under Article 885 J did not apply to a rente viagere in payment, it is arguable that the exoneration of Article 885 A would apply during the first 5 years of the payee's fiscal domicile in France, if it were being paid outside France.