Just moved to France.. (self-employed).. what stops me from NEVER filing a tax return?

[hstraf]

My company is "internet based".  All my revenue is placed in bank accounts in the US, and I pay taxes in Canada for what I claim as income.

I just moved to France... and I'm trying to understand WHY should I register or file an income tax return here? From what I can see, it will be a distinct financial disadvantage (ie: cost me much more in taxes) to pay taxes here.

I don't understand.  I also don't speak French, so my ignorance  level is pretty high...)

Thoughts?

 

[Val_2]

Let me give this warning. As soon as you buy anything here from property to a sideboard, the authorities know all about you.If you are living here for more than 180 days per year then the UK IR deem you as a french resident and you need to file a tax return here to proove your status. Everything you do from then on can be examined without your permission, any bank accounts you open for day to day living will be subject to open scrutiny by such bodies as URSSAF,Trésor Public and any Huissier that a creditor may hire if you default on any payments. You want a TV, then a licence will be issued in your name via your Taxe d'Habitation as from this year which comes from you buying property here. I'm afraid that France is not the country in which to "hide out" from not paying your social charges,taxes or any other impositions, if that is your aim,then I suggest you go and work and live in a tax haven such as Jersey,Isle of Man,Gibraltar or the Carribean but not here.

[hstraf]

Thanks for the info!  My goal isn't to hide out.  Actually, I'm a pretty honest person.

My goal is to just try and figure out what is needed and what is not.  I don't want to register for a bunch of taxes if I don't have to. At this point, I'm so confused about what I do and don't have to do that I'm just wondering if it's easier to live here without doing anything at all.  (Hence my post.)

Since I don't speak French, I'm having no end of problems/difficulty trying to find accurate information about what I need to do.

(BTW - I'm from Canada.)

At the moment, my entire business is internet based with all revenue coming in from either PayPal deposits or merchant account deposits into my US bank accounts.  I file my Canadian taxes every year, and declare my income, etc..

So now I have moved to France, and I'm very confused on what to do. I am actually French (my father was from here, and now I'm just waiting for my carte d'identity" to arrive), with a French passport, etc..  Not being able to speak French is really causing a problem, as I live in a fairly isolated area where there doesn't seem to be anyone who can help with translation.  (I'm in a smaller village in Corsica.)

Any advice?

For now, I'm just planning to continue my business activity (I finally just got ADSL!) and at year-end I'll file my usual Canadian tax return.  I'll continue trying to get info on the French rules/regulations to find out what I "need to do"...

Any advice or suggestions would be greatly appreciated. 

[Lori]

You might find the answer to your question somewhat detailed.  As I understand it, if the work you are doing is being done in this country, you must file here, irrelevant of the fact that the enterprise you work for is not in France.  It doesn't necessarily mean that you will be taxed further if you prove that you are doing the work for a Canadian or foreign country and are paying taxes into their system.  You will most likely be required to attach that tax return to the return you file here.

Try reading  www.service-public.fr  There is a a huge database of tax information on the site, along with quite a bit of other data you should review if you plan to stay here, AND, it is available in English.

Not to file, well, obviously that would be your decision, but do read up on the facts before you decide. 

[hstraf]

Excellent.  Thanks for the link to that website; I'll check it out asap!

I'll definately file, if I am instructed or obligated to do so.  It's just a matter of getting the right information.. which seems to indicate that I do need to file.    Wish me luck!

 

 

[Viv]

Last week I asked for advice re the disadvantages of having a UK registered business in France, as I couldn't see any at that time. I wanted to have an ebay shop so all internet based.

I had some advice from Will the Conqueror to the effect of any one who is living in France and has a non French company must create a subsidiary in France and pay all fees. So for me, it is a non started at the moment.

Tried to paste the link but failed have a look back under 'UK registered business'.

[Russethouse]

Look for posts by 'Iceni' who is also works via the internet. As I understand it if you sit on a chair in France, you pay in France, on your worldwide income too.

However everyones situation is different and IMHO it is well worth paying for proper professional advice on this.

[Will]

The situation mentioned by viva above revolves around having your own company registered in another country, which will effectively employ you as an outworker, based in France. There are certain books on sale, and articles written by tax accountants, that offer this as a way to reduce the tax you pay in France. This is quite probably true as far as tax is concerned, but any savings here are nullified many times over by the social security charges you have to pay. The French system is that you have to set up a subsidiary that pays the employer's social contributions, while you pay the employee contributions. Together, these can easily add up to 60% or more of your income, particularly if you do not earn a lot. For most people, that makes this option a non-starter.

I have known people who have avoided paying tax anywhere by quite simply not being resident for long enough in any one country during a tax year. This will not usually work in France though as there are more residency qualifications that the impôts can apply beyond the usual 183-day rule.

Do take proper, qualified advice. I am sure there are legal ways you can minimise your charges according to your particular situation, though you have to be prepared to pay out a fair sum in order to enjoy the benefits. Living here and not making a tax return or joining the health system is quite simply not an option, and can carry heavy penalties.

[Quillan]

[quote]The situation mentioned by viva above revolves around having your own company registered in another country, which will effectively employ you as an outworker, based in France. There are certain books...[/quote]

The thing about tax and Cotistations can often be misleading especially when it comes down to percentages. What you need to ask and /or know is when these percentages actually happen.

For many UK expats the thought of paying nearly 60% cotistations (that’s NI contributions roughly speaking) will seem very high but then they are taken after everything else is taken from your wages i.e. tax and tax allowances. In the UK you pay a lot less percentage wise but then in is taken before all other tax and allowances applied, this makes a big difference when you talk about percentages although the actual amount of money paid is roughly the same. Of course not knowing how they are calculated in Canada I can't pass comment on the original question but I am sure there must be somebody there (Canada) who can help as there is a large amount of cross immigration between the countries. I personally wouldn't use any information from this Forum or books produced in the UK for comparisons as they obviously compare between UK and France.

For what it's worth I am so impressed with the French system that three years ago I moved everything here. OK I keep a bank account in the UK but only to pay my Sky subscription and credit cards (if I use them). I am much better off here than the UK, I pay less tax and my social cotistations are actually lower but then that’s because of my specific business. They even give me my tax back on the dividends I receive from my BT shares. If you have a good French friend to help you can save a fortune, most are absolute experts at 'tax avoidance', much more so than the English.

I would like to reinforce what Will said about registering here. I am also thinking that if you are resident here and running a web based business then why pay tax and social charges in