Expat Forum For People Moving Overseas And Living Abroad banner

1 - 14 of 14 Posts

·
Registered
Joined
·
4 Posts
Discussion Starter · #1 ·
Hi All,

I need your help on shedding some light, and your experience of course. Many thanks in advance.
I work in the IT software industry and live in Paris. I am a french citizen and american company that has an office in London, but doesn't wish to register neither a company or recruit under french law, is offering me a good position. I would have a UK job letter and contract, and paid with a UK payslick.

My questions are :
I Know there is PAYE in the UK, but I'll spend most of my time in France, so will the tax be deducted from my salary each month?

Can I be paid in Euro instead of pounds?
Can my salary be wired to my french bank account or should I open a local account in England?

Anyway I plan to go to the "Centre des impôts" and ask them their advice. Though, your expertise would definitely help me out. I'll share with you what they tell me at the impots.
Thanks a lot in advance.

Best
 

·
Administrator
Joined
·
50,425 Posts
If you are on the payroll for a company with its offices in London, you'll probably be subject to PAYE and British social insurances. That's the main reason most companies don't want to establish a French branch or payroll - it's complicated and expensive to the employer. Plus, it's getting ever more difficult to "transfer" your social insurance rights from one country to another - particularly health care (sécu/URSSAF).

The matter of being paid in euro vs. pounds or having salary direct deposited to your French account is pretty much up to your employer.

Another alternative would be to hire on as a contractor/vendor, where you would bill the company for your services, then YOU would be responsible for registering with the French authorities (probably RSI, etc.) and paying your own cotisations here in France. Be careful with this plan, though, because if your pay winds up being more than the VAT threshold, you'll have to register for and pay TVA on your billings to your "employer.¨ There are also some administrative reasons that a British or American company may not want to hire you as a "contractor" like this.
Cheers,
Bev
 

·
Registered
Joined
·
4 Posts
Hello Bev,

And thanks so much for your reply. I have done contracting before, but this time they just want a full time employee without the hassle of French labour law :)
I just think that if I dont live or spend max in the UKtch time (less than 180 day/y for sure), I should not be subject to Tax in the UK, or at least, very little. As the Company would pay their tax on me, no?

Have a glorious day


If you are on the payroll for a company with its offices in London, you'll probably be subject to PAYE and British social insurances. That's the main reason most companies don't want to establish a French branch or payroll - it's complicated and expensive to the employer. Plus, it's getting ever more difficult to "transfer" your social insurance rights from one country to another - particularly health care (sécu/URSSAF).

The matter of being paid in euro vs. pounds or having salary direct deposited to your French account is pretty much up to your employer.

Another alternative would be to hire on as a contractor/vendor, where you would bill the company for your services, then YOU would be responsible for registering with the French authorities (probably RSI, etc.) and paying your own cotisations here in France. Be careful with this plan, though, because if your pay winds up being more than the VAT threshold, you'll have to register for and pay TVA on your billings to your "employer.¨ There are also some administrative reasons that a British or American company may not want to hire you as a "contractor" like this.
Cheers,
Bev
 

·
Administrator
Joined
·
50,425 Posts
Hello Bev,

And thanks so much for your reply. I have done contracting before, but this time they just want a full time employee without the hassle of French labour law :)
I just think that if I dont live or spend max in the UKtch time (less than 180 day/y for sure), I should not be subject to Tax in the UK, or at least, very little. As the Company would pay their tax on me, no?

Have a glorious day
You might think so, but that's not the way it works. If you're on a UK payroll, the employer has to take UK taxes and social insurances out of your pay. It's up to you to claim back whatever you can based on whatever your claim is - but the tax laws in the UK aren't the same as what they are here in France.

And how do you expect to pay your French cotisations? That's the main reason why a UK employer doesn't want to establish a French payroll - because their share of the social insurances is MUCH higher in France than in the UK.

You're getting into very tricky territory - and the Centre d'Impots may not be of much help. They only care that you pay your French taxes, and they seem to have very little understanding of how the UK tax authority sees things.
Cheers,
Bev
 

·
Registered
Joined
·
78 Posts
I can't add anything useful here, other than to tread carefully. We pay our taxes abroad as well and as a result pay a nifty fee for our French health insurance (8% of our annual income). It works out well for us, but you should really do your homework before you make any final decisions. Contact your tax office, health insurance provider, check the impact on your retirement etc. Perhaps there are better solutions than directly being on their payroll.
 

·
Read Only
Joined
·
18,642 Posts
If you're resident in France, I believe you will need to join the CMU as indicated by Dutchess. I suggest you make an appointment with a senior person at CPAM to discuss this.

I doubt you will be able to claim back your UK NHS contributions, however these in part will go towards your pension in due course. Go to the HMRC site for more information. https://www.gov.uk/national-insurance/overview

When you visit your tax office, you should ask to speak to someone who deals with overseas income.

Good luck.

The France-UK double-taxation convention is here https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/411884/france.pdf - Note that I haven't read it.

From this link, it seems you will have to pay tax in the UK on your salary https://www.gov.uk/tax-uk-income-live-abroad

That being so, you would have to make a tax declaration in the UK.

You would then declare your overseas income on your tax declaration in France, together with the amount of tax paid. You won't be double taxed, but the UK will tax you at its applicable rate. France would credit your tax paid against your tax liability, but will not refund you any UK tax paid.
 

·
Registered
Joined
·
4 Posts
Discussion Starter · #7 ·
I ve missed this post, both i mean. Thanks a lot for your insights and good week end to you. I asked them to work as a contractor but they are not ready. The upisde for me is that the salary is very good and GBP vs Euro too, so great on the money side. True that for retirement and other things it is weak. I have to develop sales in France and other countries, and I am the 100% guy for that, I have done my math and I believe within a year max I should overachieve the expectations and I have got the agreement that when it is done, not only we'd settle a french registered office but also recruit more people. So hopefully things will change in the future. Just need to secure my situation in the meantime. All the best.
 

·
Registered
Joined
·
4,272 Posts
From this link, it seems you will have to pay tax in the UK on your salary https://www.gov.uk/tax-uk-income-live-abroad
I don't think this link applies to salaries - it's for privvate UK-sourced income, eg rental income.
HMRC/DWP won't allow you to be put on the company payroll in the UK if you don't live in the UK, however if your employer provides a UK address they probably won't pick it up. However as said, you would get left without healthcare coverage and URSSAF might well pick it up, which could be costly for your firm. This link may help
Urssaf.fr - Espace Employeurs
Votre Urssaf >> anglais
 

·
Read Only
Joined
·
18,642 Posts
I don't think this link applies to salaries - it's for privvate UK-sourced income, eg rental income.
HMRC/DWP won't allow you to be put on the company payroll in the UK if you don't live in the UK, however if your employer provides a UK address they probably won't pick it up. However as said, you would get left without healthcare coverage and URSSAF might well pick it up, which could be costly for your firm. This link may help
Urssaf.fr - Espace Employeurs
Votre Urssaf >> anglais
It applies to wages.

Frankly, there are French people who commute to work in other European countries, where those countries' healthcare arrangements don't apply in France, then they should join the CMU, which will normally be billed via URSSAF.
 

·
Registered
Joined
·
4,272 Posts
It applies to wages.
Yes but only UK-sourced wages. The source of the wages is the country where the work is carried out, not where the employer happens to be based - if you work in France for a UK company, you're not classed as being employed in the UK.

Frankly, there are French people who commute to work in other European countries, where those countries' healthcare arrangements don't apply in France, then they should join the CMU, which will normally be billed via URSSAF.
The way it's supposed to work is that if you work in an EU state, ie you are physically present there when you do the things that earn the money, that country is your 'competent state' and you belong to their social security system.
If that's also the country where you live, simples.
If it happens not to be the EU state where you / your family live, then your competent state's social security system issues you with a workers S1 (or E101 as they seem to call it) to cover your healthcare in the country where you / your family do live.
So in this case, if the work was carried out in the UK but the employee lived in France, he would pay NICs and the UK would issue an S1 to cover healthcare in France.
But if the work is carried out in France then France is the competent state, and healthcare is nothing to do with the UK, no NHS eligibility and no UK-issued S1.

https://www.gov.uk/paying-employees-working-abroad

EU regulations say that you cannot pay into the social security systems of 2 different EU states at the same time. You can only have one competent state, and for workers that's always the state in which they carry out their work.
 

·
Administrator
Joined
·
50,425 Posts
There is also a difference between someone residing in France but working for a UK company and a "frontalier" - which is someone who lives in a defined border region and who commutes daily to a job on the other side of the border. There are arrangements that can be made so that the employer is paying into the social insurance system of the country of residence of the employee. But I don't think that applies in this situation.
Cheers,
Bev
 

·
Read Only
Joined
·
18,642 Posts
Yes but only UK-sourced wages. The source of the wages is the country where the work is carried out, not where the employer happens to be based - if you work in France for a UK company, you're not classed as being employed in the UK.


The way it's supposed to work is that if you work in an EU state, ie you are physically present there when you do the things that earn the money, that country is your 'competent state' and you belong to their social security system.
If that's also the country where you live, simples.
If it happens not to be the EU state where you / your family live, then your competent state's social security system issues you with a workers S1 (or E101 as they seem to call it) to cover your healthcare in the country where you / your family do live.
So in this case, if the work was carried out in the UK but the employee lived in France, he would pay NICs and the UK would issue an S1 to cover healthcare in France.
But if the work is carried out in France then France is the competent state, and healthcare is nothing to do with the UK, no NHS eligibility and no UK-issued S1.

https://www.gov.uk/paying-employees-working-abroad

EU regulations say that you cannot pay into the social security systems of 2 different EU states at the same time. You can only have one competent state, and for workers that's always the state in which they carry out their work.
That's great info, ET and very useful for the Original Poster, as I'm sure it will be for others.
 
1 - 14 of 14 Posts
Top