Bucking the trend a bit

[BIG MAC]

We are seriously thinking on making the move to France permanent next Spring possibly earlier.

We need to get schools etc sorted and try to gear up our learning of the language in the coming year.

A few things concern me.

If I remain in English employ returning to France weekends and holidays do I pay French or English tax, please don't say both?

If I have three children going over (2 of school age one elder) and a diabetic wife (Non insulin dependent) am I making a healthcare rod for my own back?

Does the taxation status for my house change from Maison secondaire to something scary like maison expensif?

We would have a car each side and I would effectively commute. I can swap cars from time to time when I bring one over but is it better / simpler / more economic to register one as French and be done with it?

Do the kids need to have a set standard of French before a French school will take them on?

Doubtless there's loads I haven't thought about yet asthe plan was for this to be our retirement home but we are realising better to act  than live thinking what if.

Thanks.

[cooperlola]

The double taxation  agreements are there to prevent anybody from having to pay tax on the same income in both countries.  Where you pay depends upon where the work is carried out.  Where you are a "normal resident" depends upon where you live for most of the time.

On  the face of it, you get your healthcare in the UK where you will still be living.  At weekends, as you have a UK residence and a UK job, carried out in the UK, your healthcare is covered by an EHIC.  The healthcare for your family will be covered by an E109.

If you live in the UK, then there is no problem about you having a UK reg car and driving it over here for visits etc,but check with your insurance company and be very honest about your proposed situation.  Your family, if they are going to use a car regularly, need one which is registered here.

Don't know the first thing about kids' education, but they'll get along better if they have a good grouding in French first, as will you and your wife, as you no doubt realise.[:)]

[BIG MAC]

Cheers CL 

[Sprogster]

You can though end up paying UK National Insurance and the French equivalent, as this is not covered by double taxation agreements.

Also to say you won't be taxed in both countries is not I believe strictly correct, as if you are French resident you still have to complete a French tax return and declare your world wide income and gains. Although, UK tax paid will be applied as a tax credit against your French tax liability, if your calculated French tax liability is greater than the UK tax paid, you will have to pay the balance to the French Fisc.

[BIG MAC]

AHA thanks Sprogster just the kind of thing we need to know......so I guess we need to factor in a French Accountant also then?

[cooperlola]

Hence my comment about not paying twice on the same income.  It's highly unlikely that there will be any income tax to pay over here, as you and your wife each gets an allowance so it normally works out cheaper for a couple, particularly with school aged children, who also get an income tax allowance.  But if you have any "unearned" income (share and building society interest, for instance) then you will have social charges to pay.   Social security payments, as such, do not apply to you, as you will not be under the French health system, and your family will be covered by E109s so they won't be liable either.[:)]  Whatever, as Sprogster says, you MUST fill in a tax return here, wherever you are liable to pay.

Have a decco at the Tax FAQ at the head of the Finance board on the forum.  S/D has explained most of the tax stuff pretty well!

[Will]

What you have been told already is broadly right.

The comment about social security cover and E109 is correct if your spouse does not work in France. If she does, then she will pay cotisations (social security charges) on her income and the family should be able to 'piggy back' on to that. Your own health cover will depend on where you spend most of your time. If you work, say, four days a week in England and spend the other three in France, there is no problem - you pay tax and NI and use your EHIC for France. If you spend more time in France then things get very complicated and the French will expect you to pay into their system, so you would have to apply to HMRC for exemption from NI charges.

If your older child is fortunate enough to be able to find work in France then that may complicate things - but most likely he/she will be regarded as an individual in his/her own right who happens to live in the same house, and pays his/her own tax and cotisations, rather than a dependent member of the household.

Your situation is one of those where you meet tax residence criteria in two countries, so as mentioned above you have to declare your income in both countries, and where you actually pay any particular tax that is due is decided by the double taxation agreement. Because Britain taxes you as an individual and France as a couple, you declare your own income in Britain and your joint income in France which can complicate things a bit but it's not as bad as it sounds. In fact it can be made to work in your favour. By the way, the French tax system is based on the household being made up of 'parts' which are applied to your total income - this works rather differently from the UK's personal allowances, but the effect is much the same.

You probably don't need an accountant, but it's a very good idea to consult one, at least initially, to make sure that your affairs are properly arranged and that you fill in the right boxes on your French tax form. There are many boxes, and getting even one wrong could easily result in having to pay a lot more than is necessary.

I do have a lot of personal experience of cross-border working by the way, so this answer is based on what actually happens rather than conjecture or interpretation.