Going to make the move to France.

[butear]

Originally Posted by parsnips

Hi,
Provided it's your only UK-taxable income, rent from your house is very tax-efficient as your personal allowances will usually completely cover the rent, and it is also not taxable in France.

Hi
I think in reading the points so far I think that the income from our rental home in uk will sustain us when living in France for some time. the point about personnel allowances - is these such things as council tax, repairs home contents insurance ? good to read that renting is tax efficient, they tell me its roughly calculates at 20 % a quarter.
Non taxable in France - this may sound a tad naive, but regards Tax in france - do they have tax offices in france, is it similar to the uk. Filling out tax documents in the uk and France do the two countries work together or is it a case of inform each respectively. I know that Bev touched on this the last thing we would want would be to get doubly taxed.
Cheers Sam

[Joppa]

Originally Posted by butear

Hi
I think in reading the points so far I think that the income from our rental home in uk will sustain us when living in France for some time. the point about personnel allowances - is these such things as council tax, repairs home contents insurance ? good to read that renting is tax efficient, they tell me its roughly calculates at 20 % a quarter.

Personal allowance is the amount you can earn each year without having to pay income tax. For 2009-10, it's set at £6475. Each person can deduct the full amount from gross income, so if your house is jointly owned with your spouse, each of you can deduct it from your share of income (normally 50%). Even as a non-resident you are allowed to claim it if you are a British or EU citizen. In addition, there are certain deductions you are allowed to make from your gross rental income, called allowable expenses. There is a comprehensive list on HMRC site, but basically you can deduct such things as property insurance, repairs, council tax (if you as a landlord is liable; it's normally paid by tenant), letting agent's fees, advertising etc. You need to keep a full record of them, with receipts, as taxman can ask to see it.

[Bevdeforges]

I'm not entirely sure of your UK rental income being "tax-free" - though depending on how the UK-France tax treaty works, it may not wind up costing you French taxes on a de facto basis.

In France you must declare your worldwide income each year. There is a separate form to then explain your income from abroad, and depending upon the source and category, you're allowed whatever the tax treaties call for when they calculate your tax bill.

Rental income is subject to specific deductions and allowances, depending on the nature of the property. You need to keep (or in some cases to submit) receipts for any expenses or deductions you are claiming.

The one tricky thing (at least in the first year) is the different tax years. France taxes on the calendar year. The first year you live in France, you'll need to go get tax declarations at your local tax office. After that first filing, they'll send them to you, partially filled out. The tax authorities are said to work together, at least on cases where one side or the other suspects someone is trying to get away with something. In practice, I'm told it's generally only at major milestones that a thorough comparison is done - estate taxes are the biggie for us Americans.

I know I found the first couple of years rather difficult here in France, due to the rather peculiar (to me) layout of the French tax declaration forms. It definitely helps to get some form of tax software (ClickImpot is the brand I know, but there may be others), but at tax time there are any number of guides available at most newsstands (all in French, of course).
Cheers,
Bev

[parsnips]

Originally Posted by Bevdeforges

I'm not entirely sure of your UK rental income being "tax-free" - though depending on how the UK-France tax treaty works, it may not wind up costing you French taxes on a de facto basis.

In France you must declare your worldwide income each year. There is a separate form to then explain your income from abroad, and depending upon the source and category, you're allowed whatever the tax treaties call for when they calculate your tax bill.

Rental income is subject to specific deductions and allowances, depending on the nature of the property. You need to keep (or in some cases to submit) receipts for any expenses or deductions you are claiming.

The one tricky thing (at least in the first year) is the different tax years. France taxes on the calendar year. The first year you live in France, you'll need to go get tax declarations at your local tax office. After that first filing, they'll send them to you, partially filled out. The tax authorities are said to work together, at least on cases where one side or the other suspects someone is trying to get away with something. In practice, I'm told it's generally only at major milestones that a thorough comparison is done - estate taxes are the biggie for us Americans.

I know I found the first couple of years rather difficult here in France, due to the rather peculiar (to me) layout of the French tax declaration forms. It definitely helps to get some form of tax software (ClickImpot is the brand I know, but there may be others), but at tax time there are any number of guides available at most newsstands (all in French, of course).
Cheers,
Bev

Hi,

Under the UK/France treaty you declare your UK rents on form 2047 line VIII and after deducting expenses and UK tax paid ,transfer the net to form 2042 box TI. This income is NOT taxed in France but it is used to calculate your tax rate for any income which is taxable here. Be careful not to show the rents anywhere else on the forms ,as you may be taxed in error.
You can get more help here when you have to complete your first declaration--in the spring following the year (Jan-Dec) when you become resident.

[Joppa]

Just to clarify that you work out your taxable UK rental income according to UK rules (as I've explained) and then enter the figures on French form, as others have described. There may be a different list of allowable expenses between the two countries, for example, but you work out net income according to the tax rules for each country where the income arises.

[butear]

Hi
Have read a reread the points raised - again many thanks for all of the information, pleased that I took some interest in Maths when at school ! I shall again digest and scrutinise. My initital thought is the importance of being honest, thorough with receipts documents, to keep copies etc Bev mentioned tax office in France - is this the same set up as in uk, i.e is one able to pop into a local Tax office and speak to someone, get advice ? Will be good to be able to report in due time my experiences and rely hurdles encountered. Thanks Sam

[parsnips]

Originally Posted by butear

Hi
Have read a reread the points raised - again many thanks for all of the information, pleased that I took some interest in Maths when at school ! I shall again digest and scrutinise. My initital thought is the importance of being honest, thorough with receipts documents, to keep copies etc Bev mentioned tax office in France - is this the same set up as in uk, i.e is one able to pop into a local Tax office and speak to someone, get advice ? Will be good to be able to report in due time my experiences and rely hurdles encountered. Thanks Sam

Hi,
With regard to communicating with the local tax office (similar to those in the UK), I have found that unless you are fluent in french and fully conversant with french tax regulations, it is MUCH better to communicate in writing, and especially by email --you always get a quick reply.
If you go personally, even with a (rare) english speaking agent, there is huge scope for mis-understanding,as the systems are so different.
If you (or a french-proficient friend) write, you can refine and revise what you want to say, and MOST important, will have a written record of the tax office's reply.
Some agents , when face to face, don't like to admit ignorance and so will give you approximate, or entirely fictional answers to your questions.

[butear]

Originally Posted by parsnips

Hi,
Provided it's your only UK-taxable income, rent from your house is very tax-efficient as your personal allowances will usually completely cover the rent, and it is also not taxable in France.

Hi
Thanks agin for the info. Have several forms collected and discussed further with letting agency - their fully managed approach to renting sorts out tax, works out at 20 % / month, they take 10% commision. Another form given to be filled in for a rebate - I guess if we are not working and below the tax threshold then we should get it. Not Taxable in France is good news, and note the delay in taking up residency in August - prove to our advantage. just a thought is there a tax office in France, the uk has a walk in where one can pick up forms and seek advice - is there a similar place / set up in France. Right bag packed am of to France tonight for a week or so to check on house, be back on the forum again soon - thnks again Sam

[hils]

Re the dog: when we moved here, DEFRA & France said we didn't need passports for our dog & 4 cats if we were intending moving one way only. We did have to have rabies jabs for them all but only because we were moving to a campsite & not a "fixed" abode, & we had to have a vet certify their "fit for travel". Check with DEFRA. EuroTunnel didn't charge transportation from UK to France - they only charge because of the formalities in re-entry to UK.

If you don't intend to travel between France & UK, I would suggest that the passport is a waste of time & money. Even if you do, and there is a suitable lapse of time between your arrival and your return to UK (with dog), it might be better to get the pet passport here - you have to renew it every year anyway, so why spend out 'til you need to ? But be aware that you do need a 6 month lapse time from rabies jab - and then the "all-clear" for issue/renewal of pet passport.

Hils

[Bevdeforges]

Actually, since we're talking about pet passports, I just recently had some information from the vet on this...

Here in France, they issue you a "carnet de santé" for your pet, which documents all vaccinations, etc. Used to be they issued you with a separate certificate to acknowledge the rabies jab - which is the one you need for transporting your dog or cat around Europe, and for taking an animal with you on campsites, or placing them in a boarding kennel.

The vet said they are no longer issuing the separate certificate, and just noting the rabies vaccination in the carnet de santé with the other shots. However, if you want to take a dog or cat with you on vacation within the EU, you need a European pet passport, which costs 7€. It sounds like they just prepare it from the carnet de santé and their records as needed.
Cheers,
Bev