Daft Doctor Posted November 19, 2011 Share Posted November 19, 2011 Hi, I know that French tax residents with UK property income pay tax on that income in the UK, declare it on their French tax return, then get a French tax credit against that income to avoid dual taxation. What I'm not sure of is how this French tax credit is calculated. Is it simply the extra tax which would have been paid in France had this income been taxable in France along with any other French income in the year in question? Any insight gratefully received. Link to comment Share on other sites More sharing options...
parsnips Posted November 19, 2011 Share Posted November 19, 2011 [quote user="Daft Doctor"]Hi, I know that French tax residents with UK property income pay tax on that income in the UK, declare it on their French tax return, then get a French tax credit against that income to avoid dual taxation. What I'm not sure of is how this French tax credit is calculated. Is it simply the extra tax which would have been paid in France had this income been taxable in France along with any other French income in the year in question? Any insight gratefully received.[/quote]Hi, Yes , that is the principle, but this year there have been massive (and on-going ) blunders by the tax offices. When they do get their act together the credit should be worked out as follows. Tax on total income x exempt income (rents and/ or govt. pension) / total income = credit. Tax bill = total income tax - credit. ( rents declared net of allowable expenses but gross of UK tax, govt . pensions gross) Link to comment Share on other sites More sharing options...
Daft Doctor Posted November 19, 2011 Author Share Posted November 19, 2011 Thanks Parsnips, understood, credit = total tax x exempt income as a proportion of whole. Norman's spreadsheet includes a provision for this but I wasn't sure how it was arrived at. Link to comment Share on other sites More sharing options...
Daft Doctor Posted November 19, 2011 Author Share Posted November 19, 2011 Sorry Parsnips, just one more thing, in working out the figures, is the total income element gross or net of the 10% deduction allowable in salaries and pensions taxable in France. Thanks again. Link to comment Share on other sites More sharing options...
parsnips Posted November 19, 2011 Share Posted November 19, 2011 [quote user="Daft Doctor"]Sorry Parsnips, just one more thing, in working out the figures, is the total income element gross or net of the 10% deduction allowable in salaries and pensions taxable in France. Thanks again.[/quote]The pension should be net of the 10%; but never assume that they will do things properly. Link to comment Share on other sites More sharing options...
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