Does Anyone Know.......

[Nick]

Hi

I'm new to this forum so I'm hopeing that someone can help me.

Does anyone know anything about QROPS and the French tax implications?

[Stravinsky]

Originally Posted by Nick

Hi

I'm new to this forum so I'm hopeing that someone can help me.

Does anyone know anything about QROPS and the French tax implications?

Whats QROPS?

[Bevdeforges]

Originally Posted by Nick

Does anyone know anything about QROPS and the French tax implications?

OK, I had to look this one up on Google. I did find a website from HM Revenue & Customs that looks promising: HM Revenue & Customs: Qualifying Recognised Overseas Pension Schemes (QROPS)

From a quick look at it, it seems like these are just overseas (to the UK) pension funds that are recognized by the UK government (for whatever). The French pension schemes mentioned are all private pension funds, as are the pension funds listed as being US based.

The "French tax implications" of such funds would depend on your country of residence and possibly your country of nationality (if that is different). Are you living in France, or thinking of moving there? Or just thinking of investing in one of the French based funds?
Cheers,
Bev

[Nick]

We are moving out at the end of August and will be paying tax in France.

[Bevdeforges]

OK, basically for French tax purposes, QROPS has no meaning. I assume this has something to do with how the pensions (contributions, fund assets and pay-outs) are taxed in the UK. If you are moving to France and will be resident there ("tax resident") then any pension fund will be subject to the usual French rules.

Briefly put, any contributions to private pension schemes are deductible from income only if they qualify under one of the French pension legislation plans (Loi Madelin, for example) - and that usually only includes French-based funds. The fund normally sends French taxpayers a statement of how much of the contribution made during the year is deductible.

Pension benefits paid out from any and all funds are reported on your French income tax forms as income.

The asset value of private pension funds may have to be included as part of your assets for determining your French wealth tax liability - but under some (limited) circumstances you can exclude them if they meet the definition of a pension-based insurance plan (which may mean you have to declare them as "life insurance" on your income tax forms - though this shouldn't generate any income tax liability for you).

I think this should cover your concerns, but if not, come on back with further questions. (It's tax season here in France and I just happen to have my forms sitting right by my desk at the moment.)
Cheers,
Bev

[giantpanda]

Hi!

The nationality of the person declaring plays no part in the declaration.

There can be several cases, which imply a different declaration procedure on 2047 and 2042.

1. pensions paid without any taxation.

2. pensions paid and taxed in the land.

3. private pensions* un taxed

4. private pensions taxed.

* in French understanding a private pension is one, where the person declaring is the only contributor - no other participation wahtsoever.

For normal pensions taxable in France, there is a 10% allowance.

For private pensions, taxable in France, the allowance depends from the age, at which it was first paid.Allowances up to 70%, but then there is 11% CSG (Contribution Sociale Généralisée ) based on the taxable income ( private pension - allowance ).

Yours,

giantpanda

[parsnips]

Hi Nick, or is that Nicky N N?
Re giantpandas point re private pensions, tax advisers differ over how to declare these as they are not exactly equivalent to the french "rente viagère", which is how giantpanda suggests you declare. If you have a moderate income(less than about 20000€ taxable for a couple) it's best to declare these under" pensions ,retraites,rentes etc" and not"rentes viagères", and so avoid the 11% social charge altogether ,while almost certain to pay no
income tax.

[giantpanda]

Originally Posted by Nick

Hi

I'm new to this forum so I'm hopeing that someone can help me.

Does anyone know anything about QROPS and the French tax implications?

Hi!

If it is what was described you have 3 cases in the EC .

1. Taxed outside France. You declare gross and tax paid, and are not retaxed in France.

2. Untaxed, the it is considered as other pensions or even salaries, where you get a basis allowance of 10%

3. If you have a private pensions in a French understanding ( one where you are and have been the only contributor - no others, such as firms etc. ) then you gget a higher allowance, depending on the age at which it was first paid.
Also then in most cases you are subject to CSG ( Contributions sociale généralisée at 11% rate ). But even with that the total allownace is much higher than the 10%.

See here: the lines : Détermination du montant imposable:

Imposition des rentes viagères - Service-public.fr

Yours,

giantpanda

[giantpanda]

Originally Posted by parsnips

Hi Nick, or is that Nicky N N?
Re giantpandas point re private pensions, tax advisers differ over how to declare these as they are not exactly equivalent to the french "rente viagère", which is how giantpanda suggests you declare. If you have a moderate income(less than about 20000€ taxable for a couple) it's best to declare these under" pensions ,retraites,rentes etc" and not"rentes viagères", and so avoid the 11% social charge altogether ,while almost certain to pay no
income tax.

Hi!

Please note: I did not say that private pensions = rentes viagères.

I gave the French definition of a rente viagère à titre onéreux, which in English would be a private pension, but not the other way around.

So if you have a rente viagère à titre onéreux - one where the beneficiary is the only contributor - not other contributors whatsosever, you would declaring too much if you declared it as a normal pension.

Yours,

giantpanda.

NB. Most of my income are private pensions from different countries.

[parsnips]

Originally Posted by giantpanda

Hi!

Please note: I did not say that private pensions = rentes viagères.

I gave the French definition of a rente viagère à titre onéreux, which in English would be a private pension, but not the other way around.

So if you have a rente viagère à titre onéreux - one where the beneficiary is the only contributor - not other contributors whatsosever, you would declaring too much if you declared it as a normal pension.

Yours,

giantpanda.

NB. Most of my income are private pensions from different countries.

My reply refered only to UK source pensions which I think interest Nick. It is true that by declaring as a normal pension there is a smaller tax- free allowance but many UK pensioners pay no or little income tax in france, and where there is a liability to income tax there are many ways to reduce or eliminate this( investment in PME, employment of domestic help,donations to charities, re-arranging investments into Life Assurance plans,etc.)
By declaring as rente-viagère the allowance against income tax will be higher, but CSG etc @11% will certainly be levied and cannot be avoided by any of the above methods.