Calculating Tax...

[naps]

I'll try to keep this short, in hope that there is a simple answer...

We own a property here which we will have to rent out when we move to France.  The income is going to be an estimated 1000 euro's per month (providing we get a tennant of course)

I've already read that ALL income is to be declared on the French tax forms, however for tax calculations would it then just be combined with our salaries and taxed at the relevant rate?  I.e. if it takes us into a higher band then this will be taxed at that rate.  Or is there a special way of taxing income from a property abroad?

Finally would agent's fees, maintenance of the property be deductable?  We're not going to be running it as a business, just getting enough to cover the mortgage while we're away - and before I hear screams of don't do it - don't worry we do have a back up plan to cover the mortgage.

Thanks.

 

[derf]

Afik, any property rented out in the UK has to be taxed within the UK, you don't have any choice in that. of course you will be able to offset all the usual expenses on your UK tax forms, then you would have to declare the balance, along with all other worldwide income to the French Impots, if you are resident here. 

[naps]

Why did I think it could be so straight forward.  The house I'm going to rent out isn't in the UK, so it looks like I'll have to look into it from this side, but thanks, at least I know that the income (although declared) won't be subject to French taxation as I'll already be taxed here.

[tonyfitz]

Being in a similar position in the UK I  have found it invaluable to solicit the advice of an accountant. The first seesion I had lasting half an hour was very helpful in terms of taxation on rental income etc.  Apparently if a reasonable chunk of that income is to cover interest payments on a mortgage then there is very little tax to be paid from this.  The first session was free and the accountant offered long term support and to act as a point of contact in the UK when we move to France for the sum of £355 (incl VAT) per annum.  My view is that this service is well worth it and can save a lot of grief.

[naps]

Thank you - I'm doing calculations on worst case scenario as we're probably going to have to make a decision before we can get the real figures - that way I shouldn't be too disappointed.  We'll be using an accountant to calculate our tax return for here and France over the coming years so they no doubt they will work it out to something better than what I am anticipating.