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Tax treatment of income received as gifts


Rob G
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Hi,

Because we are in France as Christian missionaries, we may receive financial support from people and/or churches in the UK. This may take the form of one-off gifts, or of regular monthly amounts (paid, for example, by standing order). In all cases, any monies received will be paid into our UK bank account before being transferred to France.

I need to find out what the French tax position is on such income. I've hunted around a bit on this forum and other places on the internet and so far have drawn a blank. Grateful if anyone can tell me, or point me in the right direction.

Thanks,

Rob

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Have you tried contacting the Charity Commission in the UK?  I assume you're already registered in the UK and I'm sure they will be able to point you in the right direction. If the funds are raised in the UK for the purpose of supporting missionaries, then it should be treated in the same way as UK charities would send money to overseas programmes.

From the UK, these links might be useful  http://www.institute-of-fundraising.org.uk/  www.inlandrevenue.gov.uk/charities

http://www.association-infoservice.com/  gives details on how to set up a charity in France.

 

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Thanks, Pangur, for your reply. These sites are certainly useful references and I will have a scan through them.

However, we are not registered as either a charity in the UK or an association in France. We are private individuals to whom private individuals and/or organisations in the UK (e.g. churches) may wish to donate finances.

Any more pointers welcome.

Thanks,

Rob

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If you're not a legal charity and the donors are not family members, then surely the donations are just income and would be taxed as worldwide income the way a salary would be?  In effect, that is what it is, is it not?

try www.notaires.fr for information on gifts - but the only reference I have seen is to family gifts.

 

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Slightly sideways but not of topic Nick,  this figure of loosing half your income keeps cropping up all over forums, I don't loose half my income in charges, more like 27%.  There are some forms of employment where it is much less than that if there is no pension collecting body ( of course you get no pension ).  Regarding donations, these are treated as income and if it involves providing a service registration is required in the same way as any other business if it is in France. An association can be a way of approaching certain situations but anyone who gets financial gain from it must be registered for the service that they provide or employed by the association. You didn't say on the other thread what exactly it was that you were registering as with URSSAF other than profession liberale.

Chris

 

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An association though would have to have you down as an employee to pay you, you couldn't just run an association and take every day living expenses from the account. And as an employee you would incur social charges on that and would have to declare the income on your tax form too.

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Thanks, all, for your replies; I've obviously got all your imaginations working overtime!

The fact that I am going to set up as self-employed is completely separate. Even if our primary motivation for being here (other than a long-held love for France and the French) is as missionaries, we still have to find a way of supporting ourselves as fully as possible.

As regards what we are here to do, for anyone who's interested this has two strands. Firstly we are involved in a protestant church, where we are there to help out the leaders in all kinds of ways. Secondly, we will be launching one or more worship training schools in France over the next couple of years (designed to provide a means for churches to get top quality training for their musicians/singers/worship teams). Neither of these roles has any kind of salary or benefits attached to it.

So, it sounds like we will have to declare any gift income received as worldwide income, and pay tax and social charges on it. If this is the case, how will we actually declare it and be charged on it? I will be registered as a professionnel libéral, but surely this income will not be included in my professionnel revenues?

Rob

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I'm going to rephrase this question, as I'm having trouble getting to the bottom of it. If all else fails, I'll have to ask an accountant.

Forget about my plans to go self-employed. Let's just assume I get a job somewhere as an employee. Let's imagine that a private individual in the UK wants to give me a one-off cash gift. I assume I have to declare this on my tax return, and will get taxed on it? (At the same rate as "normal" income tax?) I also assume that I would not have to pay any social charges on this gift.

Now let's suppose that this person actually decides they want to give me a regular monthly cash gift. Does this change the position at all?

Finally, let's suppose that it's not a private individual but an organisation (e.g. a church or other charity) that wants to give me either a one-off or a regular gift. Does this change the position at all?

Grateful, as ever, for any knowledge on this.

Thanks,

Rob

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If you could call money that you receive from an organisation in the UK to help with living costs anything other than income, think of the ways this could be manipulated as a tax avoiding loophole. "Render unto Caesar that which is Caesar's" seems to be the appropriate comment here.

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Hi Kathy and others,

Please don't misunderstand me! I am in no way trying to find a loophole or a way of not paying what is due. I am simply trying to understand in advance exactly how this kind is treated in terms of both tax and social "cotisations".

Rob

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