mandatory to pay tax in france?

[chirpy]

An old friend 73yrs. has been here 15 years and paid little tax as very low pension.this was paid in u.k. and a form filled in for french impot officeinformation.

He has now been told he must declare and pay tax to France as well as his wife and will lose the uk marriage allowance for older couples.

IS THIS CORRECT OR DOES LOCAL OFFICE IN 87 DEPARTMENT HAVE IT WRONG AND CAN HE APPEAL AND TO WHOM??????

THANKS

[Iceni]

Is he resident in France for > 183 days per year ?

Has he filed a French tax return every year ?

John

not

[Liz]

Another question (hopefully the answer will turn up soon[:)] ). Is it a pension arising from Government service or a private pension?

Liz

[Patf]

The same thing has been told to a friend aged 70+ who has been here 17+

years and always paid tax in uk to now.Also married. After the first

shock he found it won't make much difference financially. Pat.

[Will]

I believe that one is expected to complete a tax declaration in France even when no tax is payable, e.g. when you have insufficient income or tax has been paid elsewhere. In fact you can get into deep s*** in terms of capital gains tax liability or making use of health etc services if you have not made a tax return, so it is usually beneficial for you to do so. You can be regarded as French tax resident if your main home is in France, if your dependents/family are in France, or your main centre of financial activity is in France, so residency qualifications are not the same as UK.

If tax is legitimately paid in UK, as in the case of public service pensions for example, then I would have thought UK tax allowances may apply, but I don't see it making a significant difference as in France you are generally taxed as a household rather than individuals so there is a 'two person household' equivalent allowance to the UK married allowance.

Having said that, we know of several people who have been here full-time for many years (some even running businesses, renting gites, giving French lessons, advising other English (!)) etc, who have never joined the system, and the authorities do not seem bothered. 

[Ron Avery]

[quote user="Patf"]The same thing has been told to a friend aged 70+ who has been here 17+ years and always paid tax in uk to now.Also married. After the first shock he found it won't make much difference financially. Pat.
[/quote]

That is not necessarily the case Pat.  As you may recall there was a poster on here a few weeks back who had a tax demand from the French for a large sum of unpaid tax from a UK old age pension and had to pay it and then claim the tax paid in the UK back from the UK. If your friend has been here 17 years there is no way he will get 17 years of UK paid tax back if the French send him a bill for the unpaid tax in France.

Basic rules, (sorry if I am repeating some of what Will has already stated) If you live in France you must make a tax declaration irrespective of where or what your income is.

If you have what the French call a "state pension" , this is an armed services,  civil service,  local government pension, NOT the UK old age pension , you do not pay tax on it in France, but you must declare it to the French on your tax return.

If you have any other form of income, including private pensions and the UK Old Age pension, it must be declared, unless you are specifically told not to by the French tax people.  I have heard that this has been done but I would be very sceptical of such an instruction.

The UK old age pension should not be taxed in the UK, it should be paid gross and you have to get that arranged, the fact that it may not actually mean that any of it is taxed in the UK or France does not matter either , if you let it continue to be taxed in the UK then you run a very real risk of paying tax on it twice.  The tax breaks for married couples are actually better in France than in the UK, the married persions allowance does have some meaning!!

[chirpy]

The man has small company pension and normal gov. pension paid via N.I. deductions when working in england.

He has not worked in france and was directed how to declare his income by french impot but was told he could pay tax. to uk.

He was resident in france 365 days each year.

His wife  has a teachers pension which must be taxed in u.k.and also normal gov.pension as she is now69years.

they sent in from year one the necessary return for info and were allowed to pay tax in uk.

this week they had a letter stating they must now pay infrance.

both french residents365 days/year.

as you know english marriage allowance for those born before 1936 i think have an extra allowance.

thet have calculated as a french paying couple they will be worse off by £600 and that is their concern.

[Patf]

Will, Ron - this person hasn't been avoiding the french tax people. He

has always completed a declaration. He has a teacher's pension and

govt. pension, but I think it's only the govt. pension that will be

taxed here. Pat.

[Debra]

by gov pension do you mean OAP pension?  If so, then both he and his wife's pension will be taxable in France as well as his small company pension.  I guess the teacher's pension would come under the 'government' pensions which are taxable in the UK only?

[chirpy]

y oap pension from gov. and other a company one while the wife has oap+teachers+private company i think--agreed they have not avoided paying but chose to pay uk their total taxes and returned all this in fo  each year to the french authorities ---so the question remains  MUST THEY PAT TAX TO FRANCE NOW AND NOT TO THE U.K.???????????????????????????//

HAS THE LAW CHANGED RECENTLY AND  HAVE WE  ALL MISSED IT.

[LesLauriers]

[quote user="Ab"]

  MUST THEY PAT TAX TO FRANCE NOW AND NOT TO THE U.K.?

HAS THE LAW CHANGED RECENTLY AND  HAVE WE  ALL MISSED IT.[/quote]

Both UK and France!  The Teachers pension declared and taxed in UK,

and declared in France along with details of any UK tax paid, the OAP

and private pensions declared and taxed in France.

Probably not, but then 17 years is a long time, more likely that the original Impots person did not understand the rules, but, as is often the case, simply made it up as they went along.

[Ron Avery]

Ab and Pat

The law has not changed, its just that in the past people have been given or thought they had been given,  the wrong advice.  There is a lot of confusion in France about "state pensions" and if your friends said we get a state pension (meaning an old age pension) they would have been told that it must be taxed in the UK, however by State pension  the French are not talking about the UK old age pension, they are talking about civil service/forces/ local authority pensions.  This is the "ruling" from Mme Riboulet, the helpful French tax lady,  even she can be confusing.

"State (public) pensions are taxable in UK  - private pensions are taxable in France! "

Ab/Pat if your friends have been correctly submitting a declaration for many years they will have nothing to fear but what exactly have they been completing?

Les Laurier is absolutely right about where tax HAS to be paid , as I said earlier, I know an old couple who live with their son on only a UK pension, they were told not to bother with a French return by a local tax official, as their pension is "taxed"in the UK, they do not actually pay any tax as their pension is below their free pay level and would be unlikely to pay any tax here either, but that is not the point. 

I'll post again what I got from the UK tax people when I asked about where to pay tax  before I moved here as initially as I was confused.

"I would advise that your do NOT have a choice in the country to which you must pay tax.  You will be liable to tax in your country of residence, and failure to apply for exemption from UK tax may result in your being liable in both countries".

If you are not talking about a civil service/forces/ local authority pension, it really is a simple as that.

[Debra]

I agree that the law hasn't changed and I agree that people are given the wrong advice.  On TF there is a guy who still consistently tells people they can 'choose' where they pay tax - despite myself and many others arguing to the contrary.  I'm sure a lot of people have this impression and if the local tax person is not sure and would rather avoid the question and lets them get away with it, it will not be a problem until someone more knowledgeable comes along - or is there a chance the French government will look into just how much they're losing in taxes in this way?