Social Tax

[billy10]

It is my understanding that any unearned income i.e mainly interest is taxed at 11 percent for the social fund , with no allowances ,it starts at the first Euro , is this also the case when one reach's the age of official retirement 65 or are you exempt, because It could be possible to also class OAP as unearned income ( cheek) worked 50 years to accumulate it, Any views or advice ??????

[Les Chirons]

Hi,

 

Don't know if this will help but depending on your department, there is a possibility that your local Conseill Generale will be holding regular meeteings for new arrivals with a view to helping integration into the country. This is certainly the case in La Creuse. I have attended all these meetings (which are very relaxed affairs) They usually have a representative from the all the relevant offices there.

The last one was actually aimed at making tax and social charge payments. This subject was covered and I seem to remember that the starting rate was just 7% and rising in a sliding scale thereafter. They also made the point that they would want details of   ALL  UK bank accounts held.  Having spoken to various reliable sources of information this is not a legal obligation.

 

If none of these welcome meetings are available to you, go to the Hotel des Impots. There is usually someone there who can speak English if required. I'm not suggesting you need that but just in case.

 

Sorry I can't be more helpfull.

[LesLauriers]

[quote user="billy10"]It is my understanding that any unearned income i.e mainly interest is taxed at 11 percent for the social fund , with no allowances ,it starts at the first Euro , is this also the case when one reach's the age of official retirement 65 or are you exempt, because It could be possible to also class OAP as unearned income ( cheek) worked 50 years to accumulate it, Any views or advice ??????[/quote]

No change at 65 it's still 11%.

[LesLauriers]

[quote user="Les Chirons"]

The last one was actually aimed at making tax and social charge payments. This subject was covered and I seem to remember that the starting rate was just 7% and rising in a sliding scale thereafter.

What? Tax ? Social charges ?

They also made the point that they would want details of   ALL  UK bank accounts held.  Having spoken to various reliable sources of information this is not a legal obligation.

If there is no legal obligation, why is there a fine of 500€ for each account you fail to declare?

 [/quote]

[Cahill12]

Went to see our local tax office today who told us that anyone over the age of 60 who fills in a French Tax Return is liable to pay social charges on the interest earned from any savings (gross).  Social charges are not levied on UK state and private pensions   There is a very good article on the Daily Telegraph website explaining exactly what the position is.  He wasn't able to tell me what we were actually getting for our money!!

[Will]

There seems to be a little confusion, in that the 11% mentioned as social charge is the CSG/CRDS/PS payment, imposed at a fixed rate - no sliding scale - and applied to all income in certain categories (usually stated to be 'unearned' income though confusingly some is payable too on salaries or self-employment - even things like sickness benefit) regardless of how little or how much, or the age of the taxpayer. Savings interest definitely is subject to this charge, state pensions or employment pensions will probably not be, though depending on how a private pension fund is structured there may be the possibility that a French taxman could class it as more of a savings scheme than a pension. As to what you get for the money, the answer is basically nothing. Some (the CRDS) goes to fund the French national debt, most to prop up the health service a bit (CSG) to stop its debt spiralling further out of control. Nobody seems quite sure what the PS is for.

I'm not sure exactly what the 7% mentioned with the sliding scale is, it seems to be most likely the contribution to CMU (national health insurance) which is a true social security fund, rather than a euphemism for a particularly sneaky bit of extra general taxation, (like CSG etc). This is payable on income above a certain threshold (I think about 7000€ but am probably wrong), normally including pensions.

I'm not surprised there is confusion.

EDIT - I had a look for the Telegraph article mentioned above. Is this it?

http://www.telegraph.co.uk/global/main.jhtml?xml=/global/2006/04/11/expatqanda.xml

It's even more confusing now as it refers to a lower (0.5%) rate of CRDS on pension income from non-French sources, in spite of a European ruling that these shoud not be subject to 'social charges'. And until you reach state retirement age(i.e. you receive E121)  it appears that social charges are payable on pensions.