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2007 tax return for wife living in France, husband commuting to UK during the week

Deborah

By Deborah
in French Finance

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Deborah Newbie

Deborah

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Help!  Has anyone any up to date advice/experience of completing tax return in the above situation?  I am here permanently, my husband is here at weekends only. This is my first decalarion and I have forms 2047, 2042, 2042 complementaire, 3916, and FD5 and an R43 - is this it and am I correct in thinking they all need to be completed?

RE 2047 and 2042 - Do I also put my husbands details on these forms even if he is resident in UK for tax purposes? 

RE: INCOME

1/ I have no income here except for a small amount of bank interest earnt in UK which I know I have to declare; also small amount of Livret B interest also will be declared

2/ my husband sends money monthly to pay our french mortgage and living expenses which I was verbally told at the tax office that I neednt declare - is that correct/do I need to put explanation on any of the forms?

3/ further complication is that he is a restauranteur in the UK but the restaurant has been closed for renovation since Jan 2007 and so he has not been earning a wage nor paying NI during that time...

Finding forms very hard so once I am armed with relevant information, I think I will go in and ask them to help me to complete forms.

Any advice would be most gratefully received - thanks, Deborah

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cooperlola Newbie

cooperlola

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Is your husband a resident here (not for tax, but in general terms - ie is his permanent home here?).  If yes, then both of you go on the tax form, although under the dual agreement, he will not pay tax here, although possibly some social charges on "unearned" income.  This would solve problem number 2 imo as it would be self-evident where the money for the mortgage etc comes from.  But somebody on here must be in a similar situation and hopefully will have a better answer for you!

If he is not paying NI in the UK, then how are you covered for healthcare here?  Normally, you would be covered by an E109, but presumably you can't have one if he's not an NI contributor at present?  If this isn't sorted, then I'd get onto it if I were you, as an EHIC is not valid in your circumstances.

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Will Newbie

Will

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Do you do any work in France? That will make a big difference to your situation. (edit - just noticed you say you have no other income in France, so presumably not).

Your husband will be regarded as French tax resident because his close family (i.e. you) lives in France - and possibly on other grounds too - in France you are taxed as a couple, not as individuals as in Britain. He may well also be considered UK tax resident, and the double taxation agreement will determine where tax on any particular sum will be paid.

You will probably find the French tax office helpful, but don't expect the officials there to speak fluent English, or even to have a lot of time to assist you as this is a busy time of year for them.

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Deborah Newbie

Deborah

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HI Cooperlola - husband's permanent home is here although he lives in rented accommodation in the UK during the week. So guess I put his details on the form....

I had an E106 on the relevant date last year so have been able to affiliate to CMU with that. 

One other thing you may be able to help with - as the UK financial year is April/April and the French is Jan/Jan, for purposes of reporting interest earnt on UK accounts, is it okay just to declare the yearly total or should I get a monthly average for each UK tax year and apply that to the French financial year?

Thanks for your advice so far

Deborah

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Deborah Newbie

Deborah

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Hi Sunday Driver - well its been difficult but basically we have lived off savings, friends and compensation payments from the main developpers of the project due to the project delay (which will have to be unravelled with the UK tax authorities at some stage).....
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Ron Avery Newbie

Ron Avery

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"One other thing you may be able to help with - as the UK financial year is April/April and the French is Jan/Jan, for purposes of reporting interest earnt on UK accounts, is it okay just to declare the yearly total or should I get a monthly average for each UK tax year and apply that to the French financial year?" 

 The latter, you should report the income received in the year being taxed Jan 1 to Dec 31 2007, starting from the date you moved to France.

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AnOther Rookie

AnOther

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This does seem a bit of an odd situation.

It seems clear that hubby is self employed in which case it's probable that he's not entitled to an E109 or E106 and therefore the E106 you say you have has been granted on the basis of your own NI record. Correct ?

Without an E form he will not be entitled to French health care so is he still covered on the NHS or has he told HMRC/DWP that he now resides in France, and if the latter, does he have private cover. If he's still under the NHS then he must be considered UK resident. It has to be one or the other.

Q: can a husband piggy back onto a wifes E106 in this sort of situation, I'm not sure.

With the greatest respect I have to say frankly that this whole scenario is beginning to look like a bit of a minefield and if you haven't already done so (and from what you've said so far it definately sounds like you haven't) in your position I think I would be seeking some professional advice, and not just about the tax forms [blink]

 

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cooperlola Newbie

cooperlola

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Ernie is right.   Although a husband can piggy-back onto a wife's E106, this is not the case if he is working.  You need to ask the centre for non-residents if your dependents are included on it.  What I do not know is if a Workers' E106 is appropriate for the self-employed (this is the form a person employed in the UK but living in France would normally have) and particularly a self-employed person who isn't actually working!  Like Ernie, I would be inclined to seek professional advice myself, but certainly to speak to Newcastle about his health cover.
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AnOther Rookie

AnOther

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I think the statement that he is not currently paying NI clearly indicates that he is not an 'employee' in any sense of the word.

No, you do not have to pay NI if not working but you can pay voluntary class 3 contributions which essentially keep your pension unbroken. I paid class 3 for the 12 years or so that I was working outside the UK so my pension record is still 100%.

[IMG]http://i127.photobucket.com/albums/p123/biskitboyo/NI_Table.jpg[/IMG]

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AnOther Rookie

AnOther

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[quote user="cooperlola"]Quite possibly R/H.  However, when I was self employed myself, back in the day, when not working, I still paid my NI contributions regardless (hence I had my own E106 when I moved here).  It sounds very complicated to me![/quote]

Your voluntary NI payments (class 3 ?) whilst not working were irrelevent to getting an E106 Coops unless it was during the 3 tax years prior to applying for it, and then they would have had to have been class 2, that is the yardstick, 2 full tax years of full contributions in the previous 3 years.

I'm rather surprised at you not knowing this [blink]

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Deborah Newbie

Deborah

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Youre right it is a bit odd and yes I got my E106 on the back of my own NI record.

However I would have thought that our situation vis a vis hubbie working (or will be again soon in my case) in the UK and therefore 'tax resident' there whilst wife/family are in France, is quite common nowadays although obviously our situation is currently more complicated ....

In any case I still have to do the tax declaration by 30th May so I reckon the best course of action is to declare all my bits and pieces here and in the UK and explain my husband's situation to the tax office and once his situation is back to normal, take some professional advice....

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AnOther Rookie

AnOther

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Just to correct one point Deborah, tax residency can be a complicated issue and the simple fact that a person is working in UK does not in itself infer that he is UK tax resident.

The difficult factors in your case are that he is self employed and that he spends so much time in UK, which is why I, and others, think you need some professional advice.

 

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cooperlola Newbie

cooperlola

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[quote user="ErnieY"]

[quote user="cooperlola"]Quite possibly R/H.  However, when I was self employed myself, back in the day, when not working, I still paid my NI contributions regardless (hence I had my own E106 when I moved here).  It sounds very complicated to me![/quote]

Your voluntary NI payments (class 3 ?) whilst not working were irrelevent to getting an E106 Coops unless it was during the 3 tax years prior to applying for it, and then they would have had to have been class 2, that is the yardstick, 2 full tax years of full contributions in the previous 3 years.

I'm rather surprised at you not knowing this [blink]

[/quote]Sorry Ernie, I was not clear about this.  I was technically self employed but for the last few months in the UK did not take on any work, but continued to pay the self employed stamp which - if you don't show a profit - is pretty cheap and gets you up to 18 months' E106 (not 30 as for those on the employed people's stamp) if it's paid up fully.  Hence the relevance to (the other) Deborah's situation!
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