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Discussion Starter · #1 ·
I am an Italian citizen moving to France. I am paid in the US and own my company there.

Yet the requirement for residency is that I demonstrate that I'm employed. Does anyone know if that means I must be employed by a French company? Would the Mairie accept my foreign income/company?

Or would I be forced to declare an "inactif" status? And is that necessarily a bad thing?

I've also been told because I am traveling all the time that it wouldn't technically be necessary to declare anything (since I'd be leaving France at least 3 times a month) but that doesn't sound right…
 

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If your centre of home and relevant payments is France, irrespective of where you draw your income from (& how long you spend not in France), you will be considered a French resident, and therefore have to make a French fisc declaration of all your worldwide income.

However, if you really are an EU citizen, you don't have to prove any reason to live in France, and then you just play ball like the rest of us do. I don't understand why you're being asked to justify wanting to live in France - you're just exercising EU rights.

hils
 

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Discussion Starter · #3 ·
If your centre of home and relevant payments is France, irrespective of where you draw your income from (& how long you spend not in France), you will be considered a French resident, and therefore have to make a French fisc declaration of all your worldwide income. However, if you really are an EU citizen, you don't have to prove any reason to live in France, and then you just play ball like the rest of us do. I don't understand why you're being asked to justify wanting to live in France. hils
This isn't a tax question- it's a residency question. As an EU citizen after 3 months you are required to declare residency. You have to go to the Mairie with a proof of address, passport/identity and proof of employment. If you don't have proof of employment you have to prove you are not going to be a burden on the state (I.e. Prove your income etc.). In that case you are deemed "inactif".

Are you suggesting I do nothing and just live without registering?
 

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WE didn't have to do that (Brit). Have never heard of any such conditions. Yes, you do have to let the Hotel d'Impots know you're in residence (income tax, taxe fonciere and taxe d'habitation), but as far as the rest is concerned, nope, never heard of that requirement.

hils

PS in the "olden" days, when we, Brits, still had to get a Carte de Sejour, yes, we did have to prove means of supporting ourselves - but I thought that got binned along with CdS about 5 years ago. There are certainly many many Brits here who don't go/haven't gone through the hoops you suggest.
 

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This isn't a tax question- it's a residency question. As an EU citizen after 3 months you are required to declare residency. You have to go to the Mairie with a proof of address, passport/identity and proof of employment. If you don't have proof of employment you have to prove you are not going to be a burden on the state (I.e. Prove your income etc.). In that case you are deemed "inactif".

Are you suggesting I do nothing and just live without registering?
It doesn't happen like that any more - as hils said, you used to have to do all that to get a carte de séjour, but EU citizens are no longer required to get cartes de séjour.

AFAICS your obligations, as a resident of France, are mainly to declare your income to the tax authorities when the time comes (they won't chase you, it's your responsibility to obtain the forms and submit your declaration) and ensure that you have full health cover in place. In your case, you might want to apply to join CPAM if you don't have private health insurance.

If you don't work at all in France then technically, yes you are economically inactive in France. But if you have a sufficient level of income from abroad, that would of course be recognised and you would not be considered a burden on the state. The main consequence of not working in France is that, as mentioned above, you need to make arrangements for your health cover, whereas if you worked in France you would automatically be in the system.

Essentially the 'legal residence' rules still exist to stop people living here on the breadline for a while then claiming benefits on the basis of having been resident. France needs to be able to point to the rules and say 'no sorry, you might have been here but weren't legally resident, so no benefits'. It can be important retrospectively, but it's not an issue that has to be clarified upfront any more.

The other thing you need to be crystal clear about is, could you be considered to be actually running your business from France, and if so, do you understand the position with regards to registering the business in France. People do sometimes assume that an overseas company is free to operate in France without registering - but sometimes the taxman disagrees and they come badly unstuck.
 

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I have summarized the three determinants of French residency over in Philip's other thread: http://www.expatforum.com/expats/fr...ome-abroad-how-do-i-get-health-insurance.html (Can you tell that EuroTrash and I seem to come into the forum from opposite ends? I start with the oldest posts, and he apparently starts with the newest ones.)

As an Italian citizen, there is no need to register for "residency" in France, but as you have found out already, mere residency isn't adequate to claim health care benefits here.

Depending on how you take your money from your US company, it may be considered either "salary" or dividends, either of which needs to be declared to the French fisc. If it's salary, you're going to have to set up some sort of French business entity so that you can pay the appropriate cotisations. (The good news is that you'll be able to exclude up to $97K of earned income from US taxation - or will get tax credits to offset your US tax liability once you start paying French taxes on the income.) Dividends are a bit trickier, though also protected from double taxation.
Cheers,
Bev
 

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Discussion Starter · #8 ·
WE didn't have to do that (Brit). Have never heard of any such conditions. Yes, you do have to let the Hotel d'Impots know you're in residence (income tax, taxe fonciere and taxe d'habitation), but as far as the rest is concerned, nope, never heard of that requirement.

hils

PS in the "olden" days, when we, Brits, still had to get a Carte de Sejour, yes, we did have to prove means of supporting ourselves - but I thought that got binned along with CdS about 5 years ago. There are certainly many many Brits here who don't go/haven't gone through the hoops you suggest.

Hi Hils,

So basically my understanding is that every EU citizen has the right to remain in another EU state for up to 3 months. 6 months for those looking for work. At the 3-month mark, however, France now requires EU citizens to register at their Mairie.

These is the documents I am looking at (assuming I'm understanding them correctly):

Européens en France - Service-public.fr
and
http://www.habiter.org/wp-content/uploads/guide_des_droits.pdf (Check out Page 6)

My original question was in this context (immigration) given that I am employed...just not by a French company. If I register as an "inactif" I have to show I won't be a burden on the state and show health insurance coverage, etc etc etc.

It looks like this is an immigration requirement and but your thoughts and Bev's thoughts make me wonder whether this procedure basically sets you up as a fiscal resident as well...

Any thoughts here?
 

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I think you're misreading the information given on the Service Public page you're citing. You want to be looking at these two pages:
Européen "inactif" en France : séjour de plus de 3 mois - Service-public.fr (for "inactifs")
Travailleur européen en France : séjour de plus de 3 mois - Service-public.fr (for "actifs")

Unless you're Bulgarian or Romanian, all you need have is a valid identity document that indicates your European nationality. These include your national identity card (from Italy, I presume) or your passport from your EU country of origin.

If you are employed (by a French or non-French employer - it really doesn't matter), you need to establish that you are paying the appropriate cotisations (social insurances), which means that either your employer has a French branch or you establish yourself as a business entity (anything from AE to an EIRL or EURL) so that you are properly reporting and remitting your cotisations.
Cheers,
Bev
 

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That was pretty much how I read it too. Will read again to make sure, but there was one worrying thing (in a text box on the right of one of those links) that even an EU National can be turned down for a job if unemployment be deemed to high ...

Need to read that one again too - not so much for my benefit, but for daughter's.

hils
 

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Just took a look at that other document. First of all - it's rather well out of date. Page 6 refers to those who have been in France for more than 5 years in any event.

But a couple pages before that (p. 4) it states that you're supposed to register at the mairie - however just after that it says that as of the date of the publication (October 2008) the regulation and forms for this law had not yet been published (in the Journal Officiel). There are a number of laws that were passed, but never get "published" in the JO and thus never go into effect. This, I suspect, was one of them.

This document appears to have been put out by a private law firm and so has no real authority in any event.
Cheers,
Bev


 

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Discussion Starter · #12 ·
Hi Bev,
Thank you again. What is still unclear to me is 1) what I have to do at the end of three months and 2) whether what is suggested is the same thing as establishing fiscal residency.

Specifically it says on several sites I have to obtain an "attestation d'enregistrement"...

Maybe this information isn't updated but it is consistent with how other EU member states work after a three-month period...In Italy it is just a declaration to the Police. Here they speak of the Préfecture or the Mairie.

info droits étrangers
and
EU Member-State Citizens Moving to France | AngloINFO France

I would probably never run afoul of anything because I travel constantly but a) I want to be compliant and b) not have any period of time not count toward the 5 year permanent status if I decide to stay.

I won't be paying any social charges in the immediate future since my company is small and based in the US. I would most likely have to buy private health insurance.
 

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I won't be paying any social charges in the immediate future since my company is small and based in the US. I would most likely have to buy private health insurance.
I don't think you have the choice.

If you live in France and work in France, you have to declare your income to the French tax authorities. Normally, unless another country has made an agreement with France to fund you healthcare, you are also legally obliged to contribute to the French social security system. This is the same throughout Europe AFAIK, you can't simply opt out and work on the black. How it works if you take dividends and not a salary I don't know; in that case you could maybe opt for private health insurance. But you would still declare your income for tax.

May I suggest you stop worrying about registering because whatever you might have read, in real life that isn't what happens. Whether you are resident or not and whether you are inactif or actif is determined by the facts (which can be easily ascertained by checking your financial transactions, utility bills etc), not by any statement you might make to your Mairie. Residence is decided by specific criteria, which Bev and I have quoted on this thread and your other thread; it isn't a matter that an individual has the discretion to decide for themselves.

If you arrive in France with the intention of living here permanently, you're resident from Day 1. You're not a visitor for three months and then you turn into a resident. Everyone has to be resident and fiscally resident somewhere, so if you're not resident in France for those three months, where would you claim to be resident?
 

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As it says in the Anglo Info article, this is rolling out (slowly, I might add) by region and by mairie. I would simply go to your local mairie and ask what they want at the moment when you move in.

But no matter whether your company is big or small, nor where it is based, you will need to declare whatever income you are deriving from it for tax purposes - and if you declare for tax purposes, they will come around and collect cotisations at some point. (Unless you're claiming all proceeds from your company as "dividends".) If they collect in arrears, it will be much more expensive than if you pay it up front when it's due.
Cheers,
Bev
 

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Discussion Starter · #15 ·
Fair enough on the registration and the facts that might lead the tax authorities to determine whether I am a resident after the fact (I get that...) though my question still remains unanswered-- do I need to do it or not? Or is there some other system that "puts you into the system"? In Italy it is a "codice fiscale" together with a residency declaration at city hall; in the US it's a social security number and an address.

The second question regarding health insurance depends on whether I'm "in the system" or not. I thought Bev said it was possible to just buy health insurance as an expat.

My intention at least in the short term is NOT to establish fiscal residency in France. My company's activities/nexus or source of income would not be in France- I would not even be in France most of the time since I travel. I have a home in the US. Most likely I would leave my fiscal residency in the US in the short term since I am unfortunately still liable to pay there. I am finding an apartment in Paris to reduce my travel expense and transatlantic travel.

I understand your response and it would be a simple case for most people-- particularly those who are employed-- but I do have a different situation in that it is a company and an individual- I have the ability (which I am trying to decide about) to structure things in different ways (pay myself salary in the US and just be a non-resident, open a company, etc etc) to minimize my tax liabilities.

I did post for a recommendation to a professional.
 

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Under French law, it's the individual's responsibility to fulfil their fiscal obligations. Which basically means that when it's time to make your first tax declaration, you go along to the tax office, obtain the forms and submit them. That's what puts you into the system. It's best to make yourself known at the correct time, rather than wait for them to knock on your door :cool: because there are penalties for declaring late or not declaring at all.

Your problem is that you don't want to be classed as resident in France, but you do want a base here from which to run your business. Whereas the only sure way of not being classed as resident in France is NOT to touch any income-generating activities while you're on French soil (i.e. you come here as a visitor on holiday and you don't register anywhere because holidaymakers don't) and NOT to spend more than 182 days a year here. If you do either of those 2 things, France is entitled to require a tax return from you.

As you say you need professional advice, but it's as well to be aware of the basic principle that if you want to use France as a place to base yourself to earn money, France expects you to pay for the priviledge. Also, that French law doesn't look favourably on attempts to structure a business that operates on French soil in a particular way in order to avoid taxes, so whatever you decide to do, you need to be careful. France is short of cash at the moment and if it can ensnare you in its legislation and tax you, it will.
 

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I agree with everything Bev and ET are trying to tell you. To go the professional route is an option, which will cost you, but you should check out what their liabilities will be if they advise you wrongly.

To be honest, I'd walk in to the Mairie, the (sous-)Prefecture, the Hotel des Impots, the Tresor Public, and Secu and ASK, on the spot, politely and humbly, with focussed questions. It wouldn't hurt to make advance "friends" of them all anyway, but it is they who will be trying to make sense of all the paperwork you will end up submitting, and if it doesn't make sense to them immediately, they'll likely reject it, and you WILL end up then with a bigger problem to solve.

hils
 

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The fact that you have a US based business, and that you speak/write English like you're a native speaker leads me to believe that you may have US citizenship also. If that is the case, your fiscal residency is determined by the "facts and circumstances" of your particular case. And, in some (very particular) circumstances you may actually be considered to have more than one fiscal residence.

There is also the issue of being resident vs. being tax resident - you can be one or the other or both. In France, at least, there is no particular registration process to go through. Like EuroTrash and Hils have said, unless you register a business entity in France, you "sign up" with the French fisc when you file your first tax return. Filling out a form at the mairie (if they have any idea which form the various articles are referring to) won't necessarily result in anything other than the form being filed away in the mairie's files somewhere.

The health insurance issue is at least as frustrating. If you are working or drawing benefits in France, you are enrolled in the French system. If you aren't in the French system, you're required by law to have health insurance coverage, but whether or how you'd be discovered isn't terribly clear. (I suspect you could get away without insurance for a rather long time if you only made occasional use of the medical services here.) Those who need a visa to enter France generally need to show proof of coverage as part of the visa process (i.e. before they come to France) and then again whenever they renew their carte de séjour.
Cheers,
Bev
 

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From
I am an Italian citizen moving to France.
to
I would not even be in France most of the time since I travel. I have a home in the US.... I am finding an apartment in Paris to reduce my travel expense and transatlantic travel.
potentially puts a very different complexion on things.

If you spend most of your time in the US, and you're not going to be in France much, and it's just an apartment to crash out in now and again when you're doing the rounds in Europe, much as you might stop off at a hotel ... well I don't know but if it was me I think I'd be inclined to call it a résidence secondaire (buy it in your name not the company's) and not see much need to declare or register myself in France at all. There is no requirement AFAIK for holiday home owners to register.

The OP's last post paints a rather different picture from what seemed initially implied by 'I'm moving to France' and questions about residency.
 

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From to potentially puts a very different complexion on things.

If you spend most of your time in the US, and you're not going to be in France much, and it's just an apartment to crash out in now and again when you're doing the rounds in Europe, much as you might stop off at a hotel ... well I don't know but if it was me I think I'd be inclined to call it a résidence secondaire (buy it in your name not the company's) and not see much need to declare or register myself in France at all. There is no requirement AFAIK for holiday home owners to register.

The OP's last post paints a rather different picture from what seemed initially implied by 'I'm moving to France' and questions about residency.
Tourists don't normally conduct their business from a secondary (owned) base in France. Can't see that the fisc would look too kindly upon that kind of thing. The other thing to consider is that many properties are not allowed to have businesses run from them, irrespective of what that business might be.

I'm concerned that we're giving the OP too much info in this respect that he'll be tempted to fly under the radar...

h
 
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