Tax - declaring UK income

[Rob G]

Aaargh!!!! Each time you think you've sussed how to complete your French tax return, you run into some new question! I'm hoping someone has come across this before and will be able to clear it up for me.

I'm a self-employed translator under the "BNC special" regime - also known as "micro BNC". My business income is therefore reported in box HQ on form 2042 C. However, a small proportion of this income came from customers in the UK, and was actually paid into a UK bank account. I therefore understood that it needed to be reported on form 2047 ("Revenus encaisses hors France"), in section V, and also included in the total income declared as above on the 2042.

What's confusing me is this. At the bottom of the back page on the 2047, it says that any income you've reported for "professions non salaries" as above should be carried over to line 8 TL on the main tax form 2042. But that section seems to serve to identify income where you've already paid tax overseas, and therefore are entitled to corresponding tax credits in France.

So now I'm beginning to wonder - should I be reporting this UK income on the 2047 at all, or should I just include it with French business income on the 2042 C and forget about the 2047 altogether?

Hope this makes sense to someone....

Rob

[Sunday Driver]

Your French business income is reported under box HQ which deals with the income tax.  You will find it also has to be reported under the section entitled "revenus a imposer aux contributions sociales".  This generates the appropriate CSG/CRDS/PS charges.

The UK business income is reported under the relevant section of the 2047 and as you say, is included in 2042C box HQ for the tax calculation.  However, because your foreign income is only subject to CRDS, you don't report it under the above "revenus a imposer aux contributions sociales" section - rather, you carry forward the total from section VIII of the 2047 to box TL, which solely generates the appropriate foreign income CRDS charge.  The tax element of this income was dealt with in box HQ.

BTW:  It's box TI and TK which covers tax paid abroad where credits are applied.

 

 

[Rob G]

Thank you, Sunday driver, you are a life saver!!

So, if I've understood you correctly, the component of my business income which was "encaissé hors France" is only subject to the CRDS component of the "contributions sociales" (though I assume it is subject to "cotisations" for health and retirement cover etc.).

This raises one more question - where is the "revenus à imposer aux contributions sociales" section where I also have to report my French business income?

Thank you so much once more,

Rob

[AnOther]

Reading post's like this make me sooooo thankful that we don't plan to be running any type of business in France....[:D]

[Rob G]

I've found the section you're referring to - part F of section 5 on the 2042 C. However, I'm a little concerned as the guidance notes for this section say that it is to be used if, "exceptionnellement", your profits or gains haven't been subjected to the "contributions sociales". Mine haven't yet, but then I haven't paid any social charges yet because I've deferred them for the first twelve months. My understanding was that once I start paying them, the URSSAF will collect from me the relevant charges for CSG, CRDS etc. So do I really have to report them on here too?

Thanks,

Rob

[Sunday Driver]

From what you say, it looks like you don't need to report them.  This is one to confirm with your tax office.

 

[Rob G]

Good morning SD,

Having tried all evening to get through to the tax helpline without success, I was finally able to speak to an advisor shortly before 10pm last night. (There are few things more frustrating than having to navigate your way through a menu system to be told "All our advisors are busy, please call again later"!)

Anyway, I learnt two things from the lady I spoke to:

1. I need to pay "cotisations" for health and retirement cover on all of my business income (which I do through the "organisme conventionné" I'm regostered with). However, as far as the "contributions" which are collected by the URSSAF go, for overseas income only the CRDS is payable, not the CSG and the other bits. She wasn't able to explain to me why this is, but was categorical that this was the case. This is why the amount of overseas business income has to be reported in line 8 TL as well as being added into the overall busines income on the 2042.

2. You only have to report income in the section "revenus à imposer aux contributions sociales" where it is subjec to the charges usually collected by the URSSAF but you are for some reason not registered with the URSSAF to collect them. Thus in my case, the lady was again categorical that I need report nothing in this section.

It seems to have been a major exercise to fill in a maximum of five figures across four forms, but it is now done! The forms are complete and waiting to be posted. Ouf!

Thanks again for your help,

Rob