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French Finance
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 22/04/2008, 8:10
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allanb
Joined on 04/09/2006
Posts 619
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Re: Official exchange rate for French tax return
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I think it's interesting that the definition in the tax code is not in
fact precise. It says "the rate in Paris" on the day of receipt, but
it doesn't say which rate: quoted by which bank? At what time of day?
For what amount? Purchase or sale?
My UK state retirement pension is paid in to my euro account, and the actual average for 2007 (i.e. the total euros I received divided by the total sterling amount paid) was 1.453. Since this represents the true exchange rate obtained by the Pension Service each time they gave the payment order, I think it's defensible, and I use that rate for any sterling income that needs to be converted.
What is not defensible in my opinion is to use the year-end rate for transactions that happened throughout the year. For 2007 that would result in understating income by around 6%. If your tax office says you can use the year-end rate, then of course you should do so and be happy; but make sure they are really talking about income and not asset values. I think you should assume that they understand the difference.
I have to disclose that what I do hasn't yet been challenged: nobody has asked the question.
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22/04/2008, 9:28
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cooperlola
 
Joined on 05/05/2006
72 - Sarthe - home of les 24 heures du Mans
Posts 6,545
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Re: Official exchange rate for French tax return
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 allanb wrote: | Since this represents the true exchange rate obtained by the Pension Service each time they gave the payment order, I think it's defensible, and I use that rate for any sterling income that needs to be converted.
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(My italics, not Allan's.) To my mind, this is the rub. So long as you have a logical method for your calculation, then at least you can defend yourself if the subject ever comes up - although I haven't been questioned yet either! The "year end rate method" would certainly look suspect this year - but then I guess there have probably been times when this worked in reverse - ie in the French govt.'s favour - in the past.
Healthcare Issues Site
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22/04/2008, 11:00
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chessfou
Joined on 15/11/2005
Aveyron
Posts 490
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Re: Official exchange rate for French tax return
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The "year end" rate is swings and roundabouts. My tax office asked me to use that official (year-end) rate last year (noticeably disadvantageous to me). If this year it proves to be advantageous, that seems reasonably fair.
However, I can't now find the source for that official end of year rate (it was obtained from one of the gouv web sites but I don't remember which). I recall, also, that someone (I think on this site, or was it TF?) posted a link but I can't find that either.
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22/04/2008, 13:21
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allanb
Joined on 04/09/2006
Posts 619
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Re: Official exchange rate for French tax return
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I think we can distil a golden rule from this discussion; or rather, three golden rules.
If the tax reporting regulations are not completely clear, and you have to decide which method to use -
(1) Be logical;
(2) Be consistent;
(3) Keep records.
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22/04/2008, 14:23
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lorna
Joined on 27/11/2007
the other Vienne - in Isère(38)
Posts 117
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Re: Official exchange rate for French tax return
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22/04/2008, 15:30
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Benjamin
Joined on 21/08/2005
Vendée South
Posts 1,864
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Re: Official exchange rate for French tax return
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| lorna wrote: | |
It's showing a spot rate for 31.12.08. Do they know something we don't?
Benjamin
St Malo 1-New evidence suggests mis-trial
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22/04/2008, 15:39
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magaret
Joined on 17/04/2008
Posts 26
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Re: Official exchange rate for French tax return
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| Benjamin wrote: | | lorna wrote: | |
It's showing a spot rate for 31.12.08. Do they know something we don't?
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That is ready for us next year.
Then we will have more time for other things.
Or is it to help the French Impot
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22/04/2008, 17:06
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lorna
Joined on 27/11/2007
the other Vienne - in Isère(38)
Posts 117
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Re: Official exchange rate for French tax return
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| magaret wrote: | | Benjamin wrote: | | lorna wrote: | |
It's showing a spot rate for 31.12.08. Do they know something we don't?
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That is ready for us next year.
Then we will have more time for other things.
Or is it to help the French Impot
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I've just looked again and the 31/12/08 rate has disappeared!!!
lorna
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France Forum » Legal and Finan... » French Finance » Official exchange rate for French tax return
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