11% social contributions

[oldgit72]

Can anyone tell me if there is a lower earnings/pension income limit for paying the 11% towards the French social security fund shortfall or is it paid on each euro earnt/pension received?

 

Thank you

[oldgit72]

ok just found the faq on this but still not sure - the faq states 11% payable on capital gains/investment income so that sems to rule out pension or earned income. Is the 8% on earned or 7.1% on pension income the soon to be redundant healthcare (cmu?) payment or is this the payment towards the social fund shortfal? Thanks in advance for any clarification.

[Clair]

This might help: http://www.completefrance.com/cs/forums/1048354/ShowPost.aspx

[Sunday Driver]

oldgit

Payments towards the 'social fund shortfall' etc, are called the contributions sociales (or 'social charge').  They normally amount to 11% of all earned and unearned income with no lower threshold, ie from the first euro.

The 8% you mention is the contribution made towards state heathcare cover (CMU).  It's actually 8% of your total taxable income less allowances, over an approx 8,000€ threshold.

You are exempt from the 11% social charge on your UK earned income and pensions if you are not 'a la charge' of the French state heathcare insurance system, ie if you have an E106 or E121 form and therefore you don't pay the 8% CMU contribution.  If you are paying the 8% CMU contribution, then the 11% social charge applies to your UK earnings and pension.

If you are currently paying the 8% CMU contribution, but losing this entitlement, then your UK earnings and pension will in future be exempt from the 11% social charge.

All unearned investment income attracts the 11% social charge regardless.

 

[Mike]

Does this mean that you have to pay 11% on interest earned from savings?

[BJSLIV]

interest on savings = unearned investment income

So yes

And there is no "personal allowance".

In our daily  French paper a local woman who was receiving state benefits because of her low income , was querying why she had to pay 11% of her 50 Euros interest. But the answer was that there was no allowance, she had to pay.

 

[Steve c.]

I've had this set up for a few years now and pay 11% in total, which is hard to hand over in one lump sum but then you have to think the UK bank and government where nicking 20% at the time but as usual in a stealthy way which was automatic taken each month, and didn't actually show up on the statement, just the figure after deductions, but now I get to keep it all for a year then pay the French social contributions @ 11% so its not all bad.

If I remember right the easy way is to send a R85 form to your bank who then inform the UK tax office, but this system is voluntary and not all banks have embraced it so you will have to ask.