Tax Contributions

[junebaby]

Hi everyone

We are moving to Lot et Garonne in May.  My husband took early retirement and is paid a pension each month which will be our only source of income in France.  I know there is a reciprocal thing in place with regard to tax but how does it work?  Any links or advice would be most appreciated.

My understanding is that once we are registered with a Social Security number for our healthcover we are then "in the system" and they will automatically send us a tax return to complete.  I presume then once we have completed this (I say this casually but am actually  terrified [8-)] ) we pay the tax to them and that's that.

Does this return also cover us for their NI equivalent so that when our E106 runs out in 2009 we will get the 70% healthcover or am I simplifying things too much?

Your input, as ever, would be gratefully received.

Thanks

Vicki

[cooperlola]

Try a search, top right - this subject has been covered all over the place on here - in this section of the forum.

CPAM and your tax office are not one and the same.  You will need to go to your local tax office to get a tax form to fill in to get into the French system.  That has also been covered here.  You also need to fill in the form FD5 which you send  to the Centre for Non-Residents in Nottingham, to get you removed from the UK tax system.  This assumes that the pension is not a UK government one, in which case you will continue to pay your tax in the UK.

http://www.completefrance.com/cs/forums/916298/ShowPost.aspx

When your E106 runs out, go to the CPAM with your French tax declaration and they will calculate your contributions so you can pay into the French health system (8% of your income less allowances).  When your husband reaches UK state retirement age, your costs will once again be covered by the UK.

[Benjamin]

[quote user="cooperlola"]

  You also need to fill in the form FD5 which you send  to the Centre for Non-Residents in Nottingham, to get you removed from the UK tax system. 

[/quote]

We did ours slightly different in that we submitted the FD5 (in both English and French) when we put in our first French tax return. They in turn entered our French tax reference once they had processed our first return and forwarded it, via Paris, to the Centre for Non Residents. This way there is no question that you are not registered for tax in France.

If you have paid any UK tax since being resident in France then this triggers the UK tax refund and notification to any UK based income providers that your tax coding changes to NT ( ie no tax).

One small point on the E106 front: you will need to get a letter from Newcastle when it expires stating that you are no longer entitled to cover from the UK. If you reach retirement age (ie 60th birthday) before your husband reaches 65 then you become entitled to an E121 and your husband is included as your dependent.

[Ron Avery]

Two things  What Benjamin has posted is not quite correct. You will not get an E121 at 60 unless you paid class A NI stamp if you did not pay NI at all or a class B stamp you will not be entitled to an E121 until your husband or you is 65.  After your E 106 runs out and until an E 121 arrives, you will have to pay into the French health system.

Secondly You will not need to complete a tax return until May 2008 and that will be for the period May 2007 to December 2007.The year runs January 1 to December 31 and for the first year you have to get the form from the tax office or download but  it cannot be completed on line in the first year.

Just in case you don't know, you have also to declare all bank accounts held worldwide and the interest (but not capital brought to France) on any savings accounts in the UK tax paid or not, these "earnings" are also liable to social charges at 11% of interest earned. As Cooperlola has suggested have a good trawl through the threads on here and in the health section as some of your stated assumptions so far are a bit off the mark. Good Luck

[cooperlola]

Ron, doesn't that depend upon how old our o/p is?  I don't think I get my cover (I certainly don't get a state pension) until I'm 65 as I was born in 1955.  If you were born in 1954 (female) it will be age 64, in 1953, age 63 etc. etc. until 1950 and earlier when it's 60 as per now.  How sure are you that this is right - I'd like to know as it affects me.  I had assumed that the age for healthcare rights had changed just as my pensionable age had.

[Benjamin]

Thanks for the correction Ron.

I never realised under the circumstances you describe that a female needs to wait until age 65.

I always just assumed that it was given as a right as soon as  the woman reached the normal retirement age for a State pension irrespective of her NI contribution record.

 

[cooperlola]

[quote user="Benjamin"]Thanks for the correction Ron.

I never realised under the circumstances you describe that a female needs to wait until age 65.

I always just assumed that it was given as a right as soon as  the woman reached the normal retirement age for a State pension irrespective of her NI contribution record.


 
[/quote]This is the thing I'd be interested to see cleared up.  The pensionable age for women changed and is now staged so that there will be equality of both sexes for those born in or after 1955 - does this mean the E121 will be available from retirement age or from 60 for women?

[Sunday Driver]

According to the DWP:

34. Getting long-term Incapacity Benefit, Severe Disablement Allowance, widow's benefits, bereavement benefits or State Pension when you are living in another EEA country

You may be able to get one of the above benefits from the UK when living in another EEA country. If so, you may also get healthcare cover from the UK for yourself and for any members of your family who depend on you and who live with you.

So, it's retirement age - ie, you must be in receipt of the OAP in order to qualify for an E121.

 

 

[cooperlola]

Thanks SD, as ever.  That is what I had assumed but not been certain of.