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Tax Question

Posted by gordygrk2-184034 - Created: 14 years ago
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7 replies (Showing replies: 1 to 7)

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Posted by lynnettejane - 14 years ago

Hello all we too are intersted in this subject. We have a small apartment in Villefranche sur Mer which as yet we have not rented out. I found some info, although in French here,

http://vosdroits.service-public.fr/ARBO/151400-NXIMP13

according to this a decree was passed in 1999 concerning habitable vacant properties that have been empty for 2 years. These properties have to have basic services and be empty of furniture, they are then taxed  based on a pecentage of their rentable value in the same way as taxe d'habitation.According to this info unless I have misunderstood, this does not apply to second homes, presumably because taxe fonciere and taxe d'habitation are paid. Now whether things are about to change and the French government is about to introduce some sort of sur tax on second homes is not clear from what has been said here. Is this the case, and will every one have to pay regardless of whether the property is rented?

regards Lynnette

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Posted by Julie M - 14 years ago

I too am trying to find out how I can submit returns for rental income from a property in <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />France (I’m UK resident).  The following link has given me some information. My understanding is that non-residents should file the cerfa 2042 at the Centre des Impôts des Résidents à l'étranger at 9, rue d'Uzès 75094 Paris Cedex 02 and for rental income a “special” tax return to the Local Tax Office corresponding to the place of location of the property. What this “special” form is appears to be a secret I haven’t managed to crack. The returns need to be filed before 30th April for UK residents (a month later than residents).<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

http://www.service-public.fr/etranger/info-eng.html

The 2042 form (pdf file) is here http://www.impots.gouv.fr/deploiement/p1/fichedescriptiveformulaire_1281/fichedescriptiveformulaire_1281.pdf

Look into the "régime micro-foncier" option of declaring if your rental income is €15,000 or under.

Hope this helps and if you discover the mystery special form I would be glad to receive details.

Julie M

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Posted by gordygrk2-184034 - 14 years ago

Thank you all for your advice and input.

Why then, have the French authorities not sent us a tax return form, as they know our address, which was proved when we were sent our demands for habitation and funtion taxes? Do we have to ask for one?

All transactions have gone through our French bank account, via our agent, though don't say ' speak to the agent'!  'Don't worry about it', is the usual reply to problems of this sort.

Gordon

gordy

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Posted by legend_in_my_lunchtime-182603 - 14 years ago

Sorry for the confusing advice.  I was more focused on the question of IoM declaration and a little light-handed with the comment about "the Fisc doesn't care" for the French déclaration des revenus.  Rob has more clearly stated what I meant - i.e. I've seen them tell bona-fide non-residents with no other French income to forget about it almost as if they estimated the cost of opening a new dossier and processing a non-resident as costing more than the tax was worth on the occasional rental income less allowances.

If, as Myop is saying there is a seachange and the Fisc are cracking down, then that is something to take seriously as inaction might otherwise be construed as tax evasion.

Best approach would be a letter to your local CDI asking them for their advice on how to proceed.

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Posted by Myop - 14 years ago

Legend, you're wrong this time. There's a crackdown underway on 350 websites advertising French property and on the property owners who promote their rentals on these sites.There's a whole hoolah about this on a blog at http://www.francevoila.com where it is plainly explained that, no matter where you are a tax resident, you must pay tax in France on rentals of French property.

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Posted by Rob-180901 - 14 years ago

Far be it for me to contradict the great “legend”, as the quality and extent of your knowledge on many things can not be doubted. However, not on this one. You may find the “fisc” do care very much about income being generated in their country and, in fact, any non resident is duty bound to complete a tax return, even if there is no profit at the end of the day (although many ‘centre des împots’ may well tell you to leave it if there is no profit, but they should not). By the 30th April each year a return must be completed or it can become very messy indeed.Non residents may designate a representative if they wish, however, the owner is always responsible for their return and no one else. If residents do not complete a return they may be sent a “demande de declaration”. If failing to regularise in 30 days the fisc may estimate the assessment and send a bill (usually well over what you should pay) and its up to you to contest it.Interest on overdue tax is charged at 0.75% per month and a 10% charge. If warnings (mise en demeures) are repeatedly ignored this rises up to as high as 80%! The fisc can do this going back three years, so ignore your tax returns at your peril. I would advise against waiting for them to send you a warning, as this is how the problems start.

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Posted by legend_in_my_lunchtime-182603 - 14 years ago

If you are not living (resident) in France, the Fisc doesn't care about your income generating property.  If however, you visit France to the point that residency might be construed and you encash your rent (regardless of whether profit was derived) then you are taxable.

The keyword in Isle of Man jursdiction is "remittance".  If you do not remit your French rent then they don't care.  If you do remit it then you need special advice.