Pension lump sums
You need to declare lump sum payments received from non-French pension schemes. Whilst these would normally be available tax-free up to a certain limit (normally 25%) if you were still a UK tax resident, such lump sum withdrawals are now taxable in France for French tax residents. The lump sum will be taxed at a flat rate of 7.5% after having benefited from an allowance of 10%.
There is a little confusion here as generally only if the whole pension fund is taken is there a tax rate of 7.5%- otherwise it will be considered as part of your income and taxed at your marginal rate. In reality most tax offices seem happy to levy the 7.5%!
The only exception would be a lump sum received from a military or civil service pension. Whilst this must still be declared in a different box on your form, the terms of the double tax treaty (see box below for a short explanation of this treaty) should ensure that it is not taxed.
Declaration of all foreign bank accounts and life assurance policies
It has been a requirement for many years to declare on your income tax return the fact that you hold either bank accounts or Life Assurance Investments outside France.
You have every right to have as many of these as you like, as long as you give the details to the authorities. For bank accounts, there is a specific form 3916. You should use a form for each account, or else you can simply list the details on a separate sheet of paper. The latter is normally easier and the authorities simply want to know the details of the policy or account, the name and country of the bank/insurance company, and the name of the account holder(s).
Don’t forget that any of you who have old UK endowments or investment bonds should be declaring them. I mention this because the recent budget has considerably increased the penalty for non-declaration, so it is worth taking the trouble to complete the boxes.
Please do not hesitate to contact me if you have questions about tax.*
The financial advisers trading under Beacon Wealth Management are members of Nexus Global (IFA Network). Nexus Global is a division within Blacktower Financial Management (International) Limited (BFMI).All approved individual members of Nexus Global are Appointed Representatives of BFMI. BFMI is licenced and regulated by the Gibraltar Financial Services Commission and bound by their rules under licence number FSC00805B
Double Taxation Treaty:
There is a tax treaty between France and the UK meaning that you cannot be taxed twice – you’ll need to fill in a form SI2009 France Individual which you can download from the Gov.UK website. You can only complete it once you are officially resident and paying tax in France
Contact:
jennie (@) bgwealthmanagement.net or info (@) bgwealthmanagement.com
Telephone: France 0033634119518
Visit www.bgwealth.com for information and factsheets
The information on this page is intended only as an introduction only and is not designed to offer solutions or advice. Beacon Global Wealth Management can accept no responsibility whatsoever for losses incurred by acting on the information on this page