Premium bonds

[maria0301]

Hi Bev, me again...anyone know if we can keep our premium bonds in France and if so will we be taxed on them?? Thanks.

[Bevdeforges]

I'm not entirely sure what you mean by "premium bonds" - but if they are investment instruments of any sort, there's no problem with keeping them when you're resident in France.

As a French resident, you will have to declare all worldwide income, including any interest or dividends from foreign investments. And, you will have to declare any gain or loss on the sale of the bonds. The fact of their being "foreign" may affect how you're taxed. There is a separate tax form for interest and dividends from foreign sources. On capital gains and losses, you're allowed to deduct any foreign tax paid from the proceeds of the sale.

As far as the value of the bonds, you won't be taxed directly unless you qualify for the ISF (wealth tax), in which case you will be taxed based on the market value as of January 1st of each year. You become liable for ISF when your net worth (with some adjustments) rises above 700,000 € (roughly - the amount changes each year).
Cheers,
Bev

[Stravinsky]

Heres the info you want
National Savings & Investments - Living Abroad

Premuim bonds are tax free in the UK as you know, but unfortunately like pension lump sums they are normally taxable in your country of residence if you move abroad.

[parsnips]

Originally Posted by maria0301

Hi Bev, me again...anyone know if we can keep our premium bonds in France and if so will we be taxed on them?? Thanks.

Hi,
The problem with premium bonds is that the french taxman regards any winnings as interest and wants to tax them. The thinking behind this is that as you are guaranteed your money back at any time, it is not a true lottery(unlike loto,where winnings are not taxed) but an interest bearing account, arranged so that only the winners receive the interest.
For small wins there probably isn't a problem(how would they know?), but if you won the jackpot it would be a worry that you might be taxed up to 40% of it.
If you wish to keep some premium bonds you could sell your present holding and re-purchase in the name of a TRUSTED child. There would still be a problem transferring a big win without attracting Gift Tax.

[maria0301]

Originally Posted by parsnips

Hi,
The problem with premium bonds is that the french taxman regards any winnings as interest and wants to tax them. The thinking behind this is that as you are guaranteed your money back at any time, it is not a true lottery(unlike loto,where winnings are not taxed) but an interest bearing account, arranged so that only the winners receive the interest.
For small wins there probably isn't a problem(how would they know?), but if you won the jackpot it would be a worry that you might be taxed up to 40% of it.
If you wish to keep some premium bonds you could sell your present holding and re-purchase in the name of a TRUSTED child. There would still be a problem transferring a big win without attracting Gift Tax.

Hi and thanks for the info, dont really know what to do, everything we do seems to be a problem at the moment. Am trying to sort out the Inland Revenue but they want P45s and we wont get them until April. Not sure what to do about the French Health System whether we would need a top up or not. When we started on this project the euro was weaker and we were led to believe that we could rent our house with no problem but now there is a glut of houses to rent cos people cant sell. Trust us!!

[Bevdeforges]

Originally Posted by maria0301

Hi and thanks for the info, dont really know what to do, everything we do seems to be a problem at the moment. Am trying to sort out the Inland Revenue but they want P45s and we wont get them until April. Not sure what to do about the French Health System whether we would need a top up or not. When we started on this project the euro was weaker and we were led to believe that we could rent our house with no problem but now there is a glut of houses to rent cos people cant sell. Trust us!!

You just seem to have hit a "bad patch" for moving just about anywhere.

As for the top up insurance, as long as you're going to have the French national system coverage, you can add your mutuelle at any time. They run ads here on the radio for companies that will get you the "best deal" on a mutuelle to cover your particular circumstances.

Without a mutuelle, you'll pay for everything the sécu doesn't pay for - about 30% I think it is now - on most routine things. While fees here are very reasonable (certainly compared to the US!), having a mutuelle takes all the worry out of things. If the sécu pays for something, they pass the bill along to the mutuelle, which pays up their portion. Many pharmacies now just update your mutuelle information at the beginning of the year and you don't pay anything for prescriptions - except the 0,50€ co-pay, which they just take out of your other reimbursements.

There's also the matter of dental and eye care. Sécu doesn't pay very well on either of these, so you want to be sure your mutuelle will make up the difference.
Cheers,
Bev