Paying Tax on internet business

[herbets87]

Hi, I wonder if someone could answer a few questions regarding working on the internet.

My husband & I in the throws of starting an internet business but we're unsure where to declare our tax interests.  My husband still works in the UK & spends  108 days there per year.  He is still in the tax system in the UK & we continue to claim child benefit & health via the UK.  Although we are registered here in France for the Impot Fiscal, we always declare the UK earnings & tax paid & we have nothing else to pay here.  

If I were to register the internet business under my name here in France I would obviously then fall into the french system which would mean paying the social charges, transferring the child benefit, etc. whilst my husband continued to pay tax & NI in the UK.  I would prefer to keep all our tax payable in one country &, although I will be doing the bulk of the work for the new business in France, I would like to register the business under my husbands name in the UK. 

My questions are as follows:-

Does my husband spend long enough in the UK per year to qualify to register a UK business (108 days)? The address where my husband stays whilst in the UK is his mothers.  I obviously don't want her to be penalised financially or put to any inconvenience by the authorities if we declare this as the place of work - would this happen?

I will be buying my stock wholesale from the UK but selling to a European market (including the UK). Therefore my income will not be solely from one country but mainly in euro currency.  Would the fact that I will be making transactions with people from different countries around the world enable me to make the choice of where I pay my tax?

I really don't know how much this business is going to make me - possibly just enough to cover the monthly bills.  If I do register for tax here in France what is the maximum amount I can earn per year without paying any tax & can the usual items such as stationery, electricity be offset against the tax like in the UK?

Sorry for all the questions but I need to get this right at the outset & not fall foul of any non payments to the respective governments.

Thanks in advance

 

 

 

 

 

[cooperlola]

Broadly, you are liable to pay tax in the country where the work is carried out, not where the business is registered.  It's a complicated subject so my best advice would be for you to contact an accountant who is well versed in the French tax system.  But as I see it, you will have to pay tax here, although your husband is probably OK being in the UK system if that's where he does most of his work.  It doesn't sound to me as if this would apply to you so I doubt if you can find a way to pay your tax in the UK, unless you return there to work also.

But as I say, I think you really need professional help, certainly in the set up stages -  they could possibly save you a good deal of money, and angst.

[giantpanda]

Hi!

You work one day in France, you are a French tax resident.

You do busiuness on Internet from France, then you have to register and pay Social charges.

As

cooperlola says, consult an accountant unless you have a rather low turnover, then you may fit in the Autoentrepreneur introduced 2009.

http://www.auto-entrepreneur.fr/

Yours,

giantpanda

[BJSLIV]

You also need to bear in mind that tax on your French profits will be calculated at the rate you would pay if your husband's income had actually been taxed in France.

Thats because there is no separation of husband and wife's income .

So even though your husband will pay his  tax in the UK the percentage starting rate for your deductions will be higher than you might have assumed.

PS If your husband has a high level of income I think you may find that you are excluded from the autoentrepreneur system

 

[Will]

You can still operate under the autoentrepreneur regime regardless of your spouse's income. However, there is a threshold for total household income above which you cannot pay impots on your autoentrepreneur income as you go (you still pay the cotisations in monthly or quarterly chunks according to your turnover); you then declare the income on your yearly tax return and the tax is assessed later. The tax element of the AE payments is pretty insignificant compared with the cotisations, so it's not a big deal.

By the way, we are in that situation ourselves. I have a UK income, Judie is salaried in France and also has an autoentrepreneur business. And no, we are far from rich so keep the begging e-mails for somebody else... [:D]