Why You Should Complete a Tax Return in France A
ll persons living in France must complete an income tax return. All income is to be declared even if you have paid tax on it in the UK or abroad. If you live in France for six months or more of the year or your main assets are here or you have your principal residency here, you are seen as a French tax resident. You are therefore liable to complete an annual self assessment return in France. You must declare all your income, whether earned in France or abroad or taxable in France or abroad.
I know that there are some Brits that have been living in France for a number of years that still resist the idea of completing a French tax return. I don’t know whether this is because they think it doesn’t really matter, but it does.
your personal tax assessment and the production of the avis d’impôt sur le revenue 4. Tax rebates - if you are taxed here you can reclaim tax paid in the UK on the period 2020/2021 and 2021/2022. 5. Tax Exemption - You can apply for tax exemption on income not to be taxed in the UK. This can be interesting if for example you have UK rental income the whole of your tax allowance can be moved on to this income and reduce your UK tax bill
6. Taxe d’Habitation –your income and family situation are used to calculate the amount to pay in taxe d’habitation. This information is collated from I encourage clients to Generally compared with the the déclaration complete a tax return even if amount of income tax paid in de revenus form. they have been living in If you are a the UK, you win here France for less than 6 couple and have months in 2021 for the a fiscal income in following number of reasons: 2021 of less than 44211 euros or are single and a fiscal 1. Tax in France is less – Generally income of less than 27761 euros, you compared with the amount of income will not pay taxe d’habitation on your tax paid in the UK, you win here. Also home. If you don’t complete a tax the French tax authorities evaluate return, then they will apply the the income for a short period as if it highest rate of taxe d’habitation. was a whole year, so it’s a win/win situation 7. TV Licence – if you do not have a TV, you indicate this on the 2. Tax residency – it is important to declaration form. If you have a low define residency as rapidly as income and are over 70, you don’t possible, so that the French tax pay TV licence. If you don’t complete authorities know who you are and the declaration, the tax authorities what your family situation is. can’t apply any exemptions. 3. Brexit – One of the ways to prove 8. Tax Credits on Home residency, income and the number of Improvements – If you have made years is through the completion of
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improvements to your home to make it more energy efficient then you can in certain cases reclaim 30% of the material cost and labour. This is particularly relevant for those who have just moved over, as this is when you are likely to do the majority of your renovations. There are also home improvement grants for those with lower incomes. 9. Evaluation of social/financial aid – school/university grants, prime d’activité, home assistance for elderly people etc. Your rights are calculated from your fiscal income. This is collated via your avis d’impots 10. Access to loans/credit – unlike in the UK, all access to credit is based on your fiscal income, so if you don’t complete a return to get an avis d’impots, which is the calculation of fiscal income and tax due, you can’t borrow. 11. Capital Gains on your French home – if your home is here, then you should not pay capital gains on that property. The notaire will ask for a copy of your last avis d’impots to define that the property is your home. I hope that this has made you realise the importance of your tax return.
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