Investing capital - France or UK?

[zeb]

We're tax resident in France and having sold a house, will have a few thousand euros to invest. When we first moved to France a few years ago with capital from our UK house sale, we took investment advice from our French bank and lost a lot of money very quickly. This was meant to be a low risk investment!!

Consequently we don't want to go to them for advice now, and are tempted to send our money back to the Halifax which gives a good rate of interest, better than we have seen in France, and leave it there for a year. Obviously there are exchange rate implications and we do know that we have to declare any interest from capital.

What does the panel advise?

[Gastines]

We've just been down this route. Unless you have a UK address +utility bills in your name ,you can't open NEW accounts with building societies. If you already have certain types of accounts with the Halifax ,you can add to them. We found after doing a trawl of Banks and BuildingsSoc's in UK most of them didn't want to know and in most cases the staff couldn't be bothered to either find any alternatives or offer any information. In the end we put a few bob in the HSBC Premier account which at least lets you draw up to £1000 a day ,in local currency, anywhere in the world. The staff at least took the trouble to serve us.We did point out that we are Frenchtax payers and have,at present, no UK home/address.

Don't fancy the on-line offers ,as I can't stand the headaches that goes with it all. The rate at which discs with everyones details on are going missing, cash in a tin box is looking a safer option.

Regards.

[woolybanana]

Try offshore accounts in Guernsey, Jersey or IOM. Mainland companies are well established there and there are advantages.

[fussy]

hiya on the subject of opening an english account, you may want to get in touch with first direct, they have loads of customers here in france, so they may well let you open an account with them, give it a try nothing to lose. Fingers crossed for you.

[Anton Redman]

Barclays France have a savings scheme with all kinds of conditions which does a good headline rate.  10%  would take that unless the rules restrict it to very small amounts of money

My French bank, sorry do not own it, Bank Tarneud, invited me in for an investment review.  They accepted my view - broadly Peugeot were closing their plant with the lowest labout cost per car ( ex Rootes plant in Ryton ) and setting up a new production lines in the former Eastern Block because they could not face conflict with the French unions. Toys R Us and PC World AKA PC City were both pulling out of France as soon as their leases ran out. The only growth areas on the high street were Lingerie and Estate Agents  - slightly more entertaining than the UK where it is Building Societies and Estate Agents. A short walk round any French city except Paris will show large scale business and residential properties empty which in the UK or Germany would have chancers biting your hand off to rent  Despite talk of a free market huge areas of the French economy were still miles of the pace such as mobile and land line phones

...  and they expected me to invest in a market I did not understand based on their know how.

[allanb]

If you pay tax, and if you're interested in bank deposits in euros (as opposed to an equity investment of some kind), don't do anything until you've reviewed the various tax-free deposits that exist in France - e.g. the "Livret A" savings accounts.  The rates are not great but the tax-free status makes them effectively better.

As far as I know these are offered by all banks, so your bank should be able to advise you.  If not, they are certainly offered by the Banque Postale.

[Clair]

The Livret A is only available from the French Post Office and the Caisse d'Epargne.

(This limited access is currently under review)

The CDD (old CODEVI) is available from all banks.

These have relatively low ceilings but are not subject to any taxes.

[Ron Avery]

I  think we all know by now that you cannot open a First Direct or many other Bank accounts unless you are like Fussy, resident in the UK.

[oliveau]

I'll go with woolybanana on this one. Try Anglo-Irish or Nationwide Offshore in IOM - You should be able to get 6% at least

Peter

[Just Katie]

Oliveau,

this would then be gross the French income tax rate........yes?

[Ron Avery]

Not sure I understand your question JK but any income on savings that is not tax exempt in France has to be declared in France and is subject to French income tax and sociale charges.  Of course some people don't bother to declare it if they pay tax on it elsewhere like in the UK to avoid the sociale charges but as it seems the free CMU for low incomes is to be scrapped, a few accounts may suddenly appear from the woodwork on next year's tax forms[6].

[woolybanana]

Channel Islands will either pay gross but then the income is declared to the govt of your country of residence or there is a retaining tax, currently 15% but due to go up to 25% next year.  The advantage of the latter has been that whilst you paid tax, noone knew who you were, but with the rise to 25% there seems little advantage.

The UK Inland Revenue has been granted access to Channel Island accounts and is currently tracing down UK resident tax dodgers.

[Just Katie]

Thank you both.

I understand the tax rules of offshore accounts when British residency is in force.  But flipping heck, social charges on your savings too?[blink]