French Tax return FAQs
Every year at around this time, we start to see questions about French tax return forms being asked on the forum. Many of the same questions get asked, and answered, each year. This FAQ has been compiled by Sunday Driver and Cooperlola (thanks guys) with reference to the relevant tax guidance notes published by the French Impôts It is by nature, a brief outline of the tax procedures, further details of which can be found at www.impots.gouv.fr.
We can’t hope to cover every possible permutation here, and some things will naturally be outside the scope of this FAQ, so we have focused on simple affairs like pensions and savings which address the most frequently asked questions (like it says on the box).
Q Who needs to fill out a tax return in France?
A Everyone living in France permanently (eg, your main home is here or your family live here or your centre of economic interest is here) needs to fill in a French Tax return, even if none of their income is generated in France. This includes income from pensions, house rentals, investments and savings, wherever in the world they are located.
Liability for paying tax in France for permanent residents begins on the day of arrival in France. French taxes are due each year on income earned in the preceding tax year (Jan-Dec) so for your first declaration, it's income from the date of your arrival to 31 December. The forms are usually available in the following April, for completion and return in late May (slightly later if filing the form online). The actual dates vary from year to year, but can be found here
Q But I have never been sent a French tax return form, who should I ask for one?
A If this is your first tax return in France you will need to contact your local Centre des Impôts to ask them to send you the forms. The forms are also available to download online here. A first tax return will need to be manually submitted to your local tax office. Once you are in the tax system, you'll automatically receive your future tax forms through the post
Q I already have a tax number, and have would like to do my tax return online (and take advantage of the later return-due-by date). What is the URL for the website?
A If you have already submitted a tax return in France, subsequent tax returns may be completed and filed online, here
Q How do I find out where my local tax office is, or their phone number?
A Contact details for your local tax office can be found here
Q Does everyone living in my household have to fill in a separate tax return?
A No, usually family members of households are all taxed together on the same tax form.
Q Which forms do I need?
A There are three basic tax forms - form 2047, which is a sort of work sheet for preliminary calculations before completing the main tax declaration, available to download here. Form 2042 is the main tax declaration form - enter your personal details on page 1, tick the box for your married status and enter your respective years of birth (these are important because they determine the way your tax is calculated. There are several versions of form 2042, some are simplified and do not contain all of fields necessary for residents with income that has been generated in the UK. Depending on your personal circumstances, you may need to download other versions. The third one is form 3916 (available to download here) listing each foreign bank account that you have. This form must be completed for all accounts held outside France that were in existence at any time during the tax year, even if if you did not receive any income from them. Unless these accounts change, this form only needs to be filled in once.
Q I assume I have to declare my income in Euros - anything else I need to know?
A Yes, all the figures should be in Euros and gross of any UK income tax paid.
Q Is this whole thing easy thing to do, or do I have to gather loads of documents, birth certificates, bank statements, etc and take them to the tax office?
A No, it's relatively straightforward - as you'll see, the forms are quite brief! All you have to do is complete the three of them, sign them, then post them off to your local tax office. You should keep a file containing copies of the forms together with of all your supporting financial documents, bank statements, etc in case the tax office query anything. Because you are declaring your affairs 'on trust', the tax office reserve the right to subject you to a tax audit at any time, so if you're organised, this will be no problem.
Q If I’m paying tax in France, how do I inform the UK authorities that I have moved, and reclaim the tax I’m now paying in both countries?
A As soon as you move, you should fill in form P85, which is available to download, here. When you submit your first French tax return, you must also fill in form FD5 (available here ) and hand this to your Centre des Impôts along with the rest of your forms. Your local office will then sign this to confirm that you are now paying tax in France, and will forward it to the UK, via Paris. Eventually (and this can take a little time), the tax office in the UK will refund any overpayment, and remove you from the British tax system (unless, of course, your tax is payable in the UK – see above).
Pensions
Q I receive a UK pension, do I need to declare it in France?
A If you live in France, you are taxed in France, unless your pension is a public sector one (Police, Civil Service, Forces, Local Authority etc) in which case you are taxed in the UK. No matter what, if you live here, you must complete a French tax return even if you have already paid the tax on your pension in the UK.
Q I have a UK non-public sector pension - how do I declare this?
A Company pensions and the UK old age state pension are entered (gross) on form 2047 section I. PENSIONS, RETRAITES, RENTES. The totals then go across to box AS/BS on the 2042.
Finally, if your French healthcare cover is courtesy of an E-form, then you are exempt from social charges (contributions sociales) on your UK company and old age pensions. So, on the 2047 section VIII REVENUS DE SOURCE ÉTRANGÈRE SOUMIS EN FRANCE À L’IMPÔT SUR LE REVENU ET IMPOSABLES À LA CONTRIBUTION POUR LE REMBOURSEMENT DE LA DETTE SOCIALE (C.R.D.S.) - just write in 'Titulaire de formulaire E121 (or whichever E-form you have), donc je ne suis pas a la charge de l'assurance maladie' and leave the amount box blank.
However, if your heathcare cover is under couverture maladie universelle (CMU) and you are paying your quarterly 8% health contributions, then your pension will be subject to social charges. If this is the case, then as well as entering your pension(s) in box AS/BS on form 2042, you additionally need to enter the amount of your pension in section VIII of the 2047 and transfer the total to box TL (page 4, section 8) on form 2042.
That's it for private company and old age pensions.
Q What if I can't find box TL on my 2042 form?
A It may be that you have been sent a simplified form, 2042-K. You will need to download the full 2042 form, available here
Q What about pensions based on an annuity - is this going to be a problem?
A Pensions provided through UK annuities may not necessarily qualify for the same treatment as old age or final salary (defined benefit) pensions, so you should obtain advice on your own specific circumstances in writing from your local tax office. Some background on this is available here
That's it for annuity based pensions.
Q But I'm still paying tax on my UK pension - what do I do about that?
A You need to notify HMRC that you are now living and being taxed abroad so they can adjust your UK tax code to zero and refund you any tax paid since the date of your arrival in France. You just ask them for a form FD5 which you complete and hand in to your French tax office with your first tax declaration. They will stamp it to certify you are now a French taxpayer and send it back to the UK.
Q As ex service personnel, my partner and I receive a service pension from the UK government and they are taxed at source. As we have already paid the tax on our pensions in the UK, do we really need to declare them in France?
A Yes, service pensions are public sector pensions, subject to tax in the UK and covered by the Double Taxation Treaty, but they will still need to be declared in France. So, on form 2047, your gross pension goes in section VII. REVENUS EXONÉRÉS PRIS EN COMPTE POUR LE CALCUL DU TAUX EFFECTIF - the form explains which figures go where. You then transfer the total to box TI on your form 2042.
Although you've declared it, your service pension is not taxed in France, but it is taken into account for determining which tax band your other taxable income falls into.
That's it for your service pension.
Rental Income from UK Property
Q I have a house in the UK that I rent out. Tax is deducted from the rent in the UK, do I need to fill out a French tax return.
A UK property rental income is covered by the UK/France Dual Taxation Treaty in the same way as public sector pensions mentioned above, so whilst it is taxed in the UK, it still needs to be declared in France because it's taken into account for determining your overall French tax rate.
So, on form 2047, your gross rental income goes in section VII. REVENUS EXONÉRÉS PRIS EN COMPTE POUR LE CALCUL DU TAUX EFFECTIF - the form explains which figures go where. You then transfer the total to box TI on your form 2042.
Note that income taxed in the UK under the Dual Taxation Treaty is not subject to French social charges.
Savings Interest and Dividends
Q I receive interest on savings that I have in the UK, do I need to declare this on my French tax return?
A Yes. For interest from savings in the UK, or anywhere else in the world outside France. As you'll have gathered by now, start by entering your gross interest on form 2047, section IV. REVENUS DES VALEURS ET CAPITAUX MOBILIERS ET REVENUS ASSIMILÉS 2 - REVENUS DES VALEURS MOBILIÈRES ÉTRANGÈRES ET REVENUS ASSIMILÉS. Put the gross figure in Column 5 under Royaume Uni, then transfer the total across to box TS on the form 2042.
You can now contact your UK bank/building society to ask them to pay your future interest gross. If they refuse, then you can claim a refund of the UK tax each year via HMRC.
Q We have French Livret savings accounts, on which any interest is tax free. Do we need to declare interest gained on these accounts in our gross figure? How else will the French tax authority know that this particular interest is tax free?
A If you have any declarable accounts, these will be listed on the imprime fiscale that you will receive from your bank, including which 'box' on the 2042 you have to complete.
The following are the only tax-free saving accounts which you do not need to mention on your tax declaration, as they are not subject to social tax (prélèvements sociaux):
- Livret A
- Livret d'Epargne Populaire
- Livret Jeune
- Livret de Dévelopement Durable (ex Codevi)
Q On the form 2047-K there is a line TA for the credit d'impot on dividends. I know that I need to carry it forward to line TA on section 8 of my Declaration des Revenues (in my case 2042K). However, there is no line TA on that form, where should I record this?
A 2042-K is a simplified form, you will need to download the supplementary form 2042-C, available here
That's it for the savings interest and dividends.
Cathy
Sun, sun, sun, here it comes...
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