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10/05/2008, 5:01 BobDee Joined on 17/08/2005 Reaup Lisse 47 Posts 112 Social Charges Sorry if this is a dumb question, but I am confused how the Social Charges are applied. Have just completed the first tax return and on entering the figures into the Impots tax calulator, (http://www3.finances.gouv.fr/calcul_impot/2008 ), it seems that a major percentage is also added to the total bill for Social Charges. Am I right in saying that if you are both over retirement age and you receive health care via a 121 declaration that you do not pay social charges on top of your tax bill or do you still have to pay charges based on an annuity income. The Tax FAQ's seem to say that OAP and company pensions are exempt from Social charges but are other types of income also exempt? BobD    Report

10/05/2008, 12:14 Sunday Driver Joined on 07/10/2005 Deux Sevres (79) Posts 2,749 Re: Social Charges As per the FAQ, OAP and company pensions are exempt from social charges where you hold an E-form, but annuity based pensions and other investment income is not.   Waddya mean it's only Saturday......    Report

10/05/2008, 14:20 BobDee Joined on 17/08/2005 Reaup Lisse 47 Posts 112 Re: Social Charges SD , Many thanks for that, Just a supplementary, does this mean that on savings account and annuity income, one can expect the 14% rate plus an additional 16% rate to be levied? BobD      Report

10/05/2008, 17:16 Sunday Driver Joined on 07/10/2005 Deux Sevres (79) Posts 2,749 Re: Social Charges No, just the straight 11% social charge (the sum of CSG, CRDS and PS). Edit: PS:  the social charge on the annutity income is based on the amount after the tax relief. Quick example though the on-line calculator: Two persons in tax foyer. Annuity income declared 10,000€ Base for calculation of tax 7,000€  (revenu fiscale de reference) Base for calculation of  CSG/CRDS/PS is also 7,000€ CSG = 574€    CRDS = 35€    PS = 61€  Total = 770€   which equates to 11% of the 7,000€.....   Waddya mean it's only Saturday......    Report

10/05/2008, 21:46 BobDee Joined on 17/08/2005 Reaup Lisse 47 Posts 112 Re: Social Charges So the result from the calculator shows the  tax payable (A) plus the Social Charges (B) payable, the sum of which (A+B)  is your liability? Viz:  Compte tenu des éléments que vous avez saisis, le montant de votre impôt net à payer s'élève à  A (auquel il faudra ajouter  B de contributions sociales supplémentaires) If this is so, the overall tax payable amount seems quite a bit more than the UK figure.  BobD     Report

10/05/2008, 23:45 Ron Avery Joined on 29/11/2004 Aveyron 12 Posts 3,096 Re: Social Charges Nobody has said French income tax is always less than UK tax Bob, it depends on your circumstances amd the make up of your income. If you have a lot of unearned income you pay tax on it and 11% social charges, so you might end up paying more tax than in the UK.  The income tax and sociale charges are billed separately by the way.  Look upon sociale charges as NI and your contribution to the welfare of your new adopted country Ron in the Avey-ron    Report

11/05/2008, 8:05 BobDee Joined on 17/08/2005 Reaup Lisse 47 Posts 112 Re: Social Charges Thanks Ron for the clarification. Have to say that the way the French Tax system treats savings interest has come as a bit of a shock. Working through the calculator the following results seem appropriate, Situation:  Married couple, both above normal retiremant age (65) 1) Having a joint pension  of €20,000  Pay €136 Tax  and no Social Charge. 2) Having a joint pension of €20,000 and an annuity of €5000 Pay €482 Tax plus €220 Social Charge 3) Having a joint pension of €20,000 and an Annuity of €5000 and bank savings interest of €10,000 pay €1968 Tax plus  €1320 Social Charge. Moral is, it seems, dont rely on that savings nest egg as an income source if you want to keep your tax bill low. BobD    Report

11/05/2008, 9:05 Ron Avery Joined on 29/11/2004 Aveyron 12 Posts 3,096 Re: Social Charges "Have to say that the way the French Tax system treats savings interest has come as a bit of a shock."   I think that statement is true for an awful lot of us coming from a culture of being enticed to and rewarded for saving. Its this penalisation of savings that tempts a few to all intents and purposes, honest and upright citizens,  to conveniently forget their UK savings accounts and/or  pay tax on them in the UK, hoping that they will never come to the notice of the French tax authorities, thereby avoiding paying sociale charges. There have been many on here over the years who have said they been advised to do likewise by well meaning "friends", but in this age of information sharing I think the chances of avoiding detection reduce by the day and the longer the evasion, the stiffer the penalty. Ron in the Avey-ron    Report

11/05/2008, 9:20 spg Joined on 23/08/2004 Southern Morbihan 56 Posts 1,047 Re: Social Charges  BobDee wrote: Moral is, it seems, dont rely on that savings nest egg as an income source if you want to keep your tax bill low. Which is why many French invest in Assurance Vie (s) as early as they can afford to. Sue Computing - it's another world    Report

11/05/2008, 13:55 ErnieY Joined on 05/12/2006 Nr Prayssac (Lot) Posts 2,945 Re: Social Charges If the sum of the tax and charges you'd be liable to pay is equal to or greater than that which you can earn on it in interest, be that in UK, France or anywhere, then under the mattress would seem as good a place to keep it as any I doubt even the French tax man had got bed bugs trained to snitch My doctor said one drink per day, I can live with that !    Report

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