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Residence Qualification for Expats in France

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At The Good Life France we like to try to answer some of those tricky finance questions you have about life in France such as what makes someone a resident in France. It’s not always as clear as you might think. We asked the experts at Beacon Global Wealth to clarify the residency question:

Question: I’m not sure if I am resident in France or in my country of birth as I spend time in both?

Answer: You might think this is a strange question and the answer should be obvious, but, for anyone who has interests in various countries, your place of residence can be a cause of confusion. This is because, in many cases, you may find that you fulfill the internal residence criteria for more than one country. The fact is though, you can only be considered “resident” in one place, and that country defines the tax rules and laws you’re subject to.

In France you only have to fulfil one of four conditions to qualify as “resident”, one of which is owning a home, though in theory you may spend less time in France than elsewhere. You may also have a home in the UK and spend more than 91 days per year in the UK and therefore you are technically “resident” in the UK.

So – how do you know which one holds sway? The answer is to decide which country has the greatest claim, and that answer lies in the appropriate “Double Tax Treaty”, bilateral agreements between various countries (excluding tax havens). These set out the rules for:

1. Which countries has the great claim to your residence

2. Which country has the right to tax sources of income, assets and in some cases, inheritance

3. How to ensure you are not taxed twice on the same amount

You can find details of the agreements on the French tax authority website: www.impots.gouv.fr  (see documentation/international).

In the case of the UK/France there are two Double Tax Treaties – one covers income tax, the other inheritance tax. This (with some exceptions), allows the country with the greatest claim on your residence to tax your worldwide assets and income.

How to determine your residence

The following are considered when assessing residence:

1. Where is your home

2. If you have a home in two countries, where is your place of “vital interest” (this may not always be clear)

3. If this cannot be determined (not unusual), “habitual abode” is considered, i.e. where you spend the most time

4. If you spend exactly the same amount of time in each of your homes, the country of your birth has the greatest claim.

Thanks to Jennie Poate at Beacon Global Wealth Management for the expertise and clarification on this question.

The financial advisers trading under Beacon Global Wealth are members of Nexus Global (IFA Network). Nexus Global is a division of Blacktower Financial Management (International) Limited (BFMI). All approved individual members of Nexus Global are Appointed Representatives of BFMI. BFMI is licensed and regulated by the Gibraltar Financial Services Commission (FSC) and bound by the rules under license number FSC00805B.

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