Tax return season is almost upon us and of course rules and regulations differ from country to country. So here are some things to consider.
- The tax year runs January to December.
- Tax forms are generally done per household for married or PACS’s couples and even children get an allowance
- There is a small window to complete last year’s tax declaration which opens shortly and runs until the beginning of June but actual dates differ according to area.
- So, you complete a tax form shortly for the time you were in France for 2023, even if you arrived say in October.
A summary of French tax rates 2024 per adult
Up to €11,294: Nil
€11,294 to €28,797: 11%
€28,797 to €82,341: 30%
€82,341 to €177,106: 41%
Over €157,806: 45%
Flat tax on investment income in France
The tax rate for investment income remains unchanged at 30% (inc. social charges) for income. This is known as PFU or Prélèvement Forfaitaire Uniquement and for those of UK State Pension Retirement age, the social charges can reduce but you must provide evidence to the tax office to get the discount
French social charges
No changes were announced for social charges, so it looks like they will remain as:
9.7% for employment/self-employment income
9.1% for pension income
17.2% for investment income including rental income.
Real Estate Wealth tax and Succession Tax in France
The current threshold of €1,300,000 for the ‘IFI’ real estate wealth tax will stay in place for 2020, with no changes to the scale rates of tax. The 75% limitation also remains unchanged.
Don’t forget, that all income must be included on your tax return even if it has been taxed elsewhere. Usually there are agreements between countries known as a DTT or Double Taxation Treaty that clearly lists which types of income get taxed in which country so that generally you don’t get taxed twice.
Different types of pensions for example can remain taxable in their country of origin or be taxed here.
Investment income is treated similarly. So, you may have got a great interest rate say in the UK for deposit accounts, only to find that not only is the interest declarable in France but is subject to a maximum 30% tax. That account in the UK may not look so positive afterall.
Looking carefully at your finances so that you make the most of your money and get the best returns is key. Tax return time is a good time to review and refine what you have in assets. Its always good to review things from time to time.
If you’d like to find out more or have questions about how to maximise your investments, contact Jennie for an obligation free consultation at: jennie@abc-eu.com
This communication is for informational purposes only based on our understanding of current legislation and practices which is subject to change and is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.
ABC-EU are members of Nexus Global (IFA Network). Nexus Global EU is a division of Blacktower Financial Management (Cyprus) Limited (BFMCL) and Blacktower Insurance Agents & Advisors Ltd (BIAAL). ABC-EU is an Appointed Representative of BFMCL which is licensed and regulated by the Cyprus Securities & Exchange Commission (CySEC) – Licence No. 386/20. ABC-EU is an Appointed Representative of BIAAL which is licensed and regulated by the Insurance Companies Control Service (ICCS) – Licence No. 5101
