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Contribution Social Génerlisée

Senga

By Senga
in French Finance

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Senga Newbie

Senga

Posted
Posted

I've just read the article on the front page of French News. It covers the healthcare cover/ cpam issue. Under the title of "The main changes in France", there is the following " The rate of the contribution social géneralisée will be the same for early retirees as those in work: 7.5% of their income"

As far as I'm aware this is not connected to CMU/CPAM payments, and am concerned that we are about to get a hefty tax increase. This will presumably affect lots of early retirees, can anyone shed any light on this. 

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cooperlola Newbie

cooperlola

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Yes, I'm afraid this is another of Sarkozy's reforms to hit the early-retired : both English and French.  It has been mentioned on here, but I can't for the life of me remember where.  However, what I don't know is the age up to which this applies, because early retired here is different from the UK (lower).  Somebody will know...
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cooperlola Newbie

cooperlola

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I knew this had been discussed

"BJSLIV wrote:

One point that hasn't been picked up is that the Government has proposed that French early retirees will have to pay 7.5% CSG on their pensions, as if they were still at work, until they reach the normal retirement age. I assume that it could also apply to EU citizens in  preretirement.
Can you enlighten me a little, BJSLIV?

then

Can you enlighten me a little, BJSLIV?

On further examination it's only a relatively minor change which won't affect us . Any UK citizens, living in France who receive a pension but are not covered by E forms  are already liable a levy of 7.5% or 8.2% on their pensions. The proposed change simply abolishes a concession for preretraitees from French employers."

Up until now, this has not applied to pensions paid from other countries.  Certainly, if this is going to change, then yes, it's another huge increase in outgoings for many of us.  We need to look at this a bit more, but it just brings parity with the French so there will be little we can do about it.  However, as I say, the age group to which this is applied will be interesting as "early retirement" is often later than the French norm, for us, certainly in particular industries where 60 and even 55 can be manadatory here.  Although these ages will no doubt change here, I don't know if it will be retrospective : For instance, if a railway worker retired last year at 55 (as s/he was obliged to) will they be penalised in retrospect, or will the age for retirement alter and anybody mandatorily retired in the past, escape from penalties.  Who knows?....

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Clair Newbie

Clair

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I have looked for more details on this and this is a basic explanation (under Financing):

[quote]The CSG is paid on income from employment, substitute income, property

income and investment income. The CRDS, which came into effect on the 1st

February 1996, is also paid on all income. All persons treated as residents

of France for income tax purposes and subject to a French compulsory health

insurance scheme are liable to the CSG at the rate of 7.5% and the CRDS

at the rate of 0.5% on their earnings.

http://www.cleiss.fr/docs/regimes/regime_france/an_0.html

[/quote]

The following table gives an overview of the Social Security contributions made by employers and employees:

http://www.cleiss.fr/docs/regimes/regime_france/an_a2.html

[quote]...Surtout, il s'attaque à la politique d'emploi des seniors en prévoyant

de surtaxer les préretraites, d'imposer à la CSG les indemnités de

licenciement...

Le Monde[/quote]
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cooperlola Newbie

cooperlola

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Thank you Clair. 

I can't find the article to which our o/p refers.  I've looked at French News online and can find the healthcare article, but not the reference to CSG and overseas pensions. (Investments, yes, but that has always been the case.)  Any chance of a link, o/p?

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Senga Newbie

Senga

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Sorry just re read your post, there is no reference to overseas pensions. Just early retirees. The quote in my earlier post lifted the only mention of it

"The main changes in France", .........." The rate of the contribution social géneralisée will be the same for early retirees as those in work: 7.5% of their income"

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cooperlola Newbie

cooperlola

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Posted
[quote user="Senga"]

Sorry just re read your post, there is no reference to overseas pensions. Just early retirees. The quote in my earlier post lifted the only mention of it

"The main changes in France", .........." The rate of the contribution social géneralisée will be the same for early retirees as those in work: 7.5% of their income"

[/quote]Sorry.  Of course income comes from many sources, but many here will be living on pensions (me for one!)  Previously, these were exempt, see

http://www.french-property.com/guides/france/finance-taxation/taxation/social-security#7.4

The item in the red box is the pertinent one.  What constitutes "retirement age" in this context?

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Sunday Driver Newbie

Sunday Driver

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Posted

Foreign income (including pensions of any kind) is subject to social charges - except where the individual is not 'a la charge' of an obligatory health insurance scheme. 

That means that anyone with an E-form is exempt because of the UK reciprocal payments.  Anyone without an E-form who is currently registered under CMU (and consequently paying their social charges) will, in future, be covered by private health insurance and will therefore become exempt. 

That just leaves those non E-form holders with chronic/long term illnesses who may be lucky enough to have their CMU cover continue - who will continue to pay social charges on the basis of that state cover.

What the Lord giveth, the Lord taketh away......[:(]

 

 

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Senga Newbie

Senga

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Thanks. I think that's sort of good news. This is the first year that we have paid CMU having previously been covered by an E-form. So presumably, we'll pay CSG for this tax year but not for next year as we won't be paying CMU. Save the money that we would have paid to them and pay a private health insurance company. Does that sound about right?? 
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powerdesal Newbie

powerdesal

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[quote user="ErnieY"]

[quote user="cooperlola"][:D]  We're all just trying to fathom if there's anything you don't know, SD![:)][/quote]

Surely if you don't know you don't know you don't know you don't know....do you....[blink]

[/quote]

Well you cant know what you dont know because if you knew you didnt know you would know ....duh my brain urts  [8-)]

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Chancer Newbie

Chancer

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There was a news article this evening showing the government minister revealing to the main (french) union representatives new legislation requiring 40 years of cotisations to qualify for a full pension. Or at least that was my understanding of the gist of it.

The unions will be striking on the 18th.

Not sure how this affects healthcare for French preretraités but it would appear that he is getting equally tough with his own countrymen, I am sure that in the UK only 30 years of contributions are now necessary.

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