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French Finance
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 16/05/2007, 12:39
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suein56
Joined on 23/08/2004
Southern Morbihan (56)
Posts 1,249
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Re: Treatment of Dividends
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 allanb wrote: | I've had a reply from the tax office (by phone, unfortunately, so I can't quote it verbatim, but it was clear enough).
The way I reported the dividend is correct, except for where I reported the tax credit.
Unfortunately I can't confirm the treatment of the tax credit because the simulation program doesn't have a place for it. But what the heck - report it. If it reduces your tax (as I think it will) it's a bonus. |
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Congratulations on such a successful conclusion Allan; I apologise unreservedly if I sounded so very doubtful, but it does seem a tad incredible at first hearing. I, too, shall give it a whirl ... when I manage to get my head around declaring online!
Sue ![Smile [:)]](/cs/images/emotions/smile.gif)
Computing - it's another world
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16/05/2007, 14:29
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allanb
Joined on 04/09/2006
Posts 601
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Re: Treatment of Dividends
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Sue: no need to apologize. I said in an earlier post that it sounds too good to be true, and that's exactly when it's wise to have doubts.
To be honest, I would still be happier if somebody could confirm it. But having told the tax office what I was doing, at least I feel protected against any accusation of fiddling my return.
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16/05/2007, 15:43
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suein56
Joined on 23/08/2004
Southern Morbihan (56)
Posts 1,249
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Re: Treatment of Dividends
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| allanb wrote: |
To be honest, I would still be happier if somebody could confirm it. |
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Perhaps this will help ...
here
in the bit just before and just under the slightly misleading heading of Double Taxation
I only came across this this afternoon, so it was news to me too.
Sue
Computing - it's another world
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16/05/2007, 18:17
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allanb
Joined on 04/09/2006
Posts 601
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Re: Treatment of Dividends
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Thanks for the link. It is slightly disturbing since it mentions only the 40% reduction and not the abattement forfaitaire of up to €3,050. However, when it comes to explaining French tax rules, I have more confidence in the French government than I have in Blevins Franks.
I hope you won't lose any sleep over it.
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18/05/2007, 18:23
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allanb
Joined on 04/09/2006
Posts 601
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Re: Treatment of Dividends
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| David wrote: | | What happens if you do not have any share dividend, and leave all the boxes blank - do you still get the tax dividend automatically? |
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Sorry, but I don't understand the question. Are you talking about an ordinary dividend paid on shares? What is the "tax dividend"?
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18/05/2007, 21:38
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David
Joined on 23/08/2004
North Deux-Sevres
Posts 369
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Re: Treatment of Dividends
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I am sorry, I am not financially fluent and I used the wrong term. Instead of "tax dividend" I should have said "tax credit", and instead of "share dividend" I should have just said "dividend".
After reading allanb's comments -
"But it gets better: in the final step of the tax calculation the tax credit (€504 in my example) is deducted from the tax you owe. It seems too good to be true, but I think it is true",
and "So I fully expect to pay no tax on my modest dividend, and to get the tax credit as well. Maybe there is a Father Christmas",
and "Unfortunately I can't confirm the treatment of the tax credit because the simulation program doesn't have a place for it. But what the heck - report it. If it reduces your tax (as I think it will) it's a bonus".
In my simple mind I thought that this meant that those who have a small dividend not only do not pay tax on that dividend, but they also get a tax credit for the unused amount of tax free dividend which is then used to reduce the total tax bill.
Projecting this onto my tax return where I have no dividend income to report, I wondered if I would receive a tax credit for the tax free dividends that I do not have and do not claim, and whether this tax credit would reduce my tax bill. I hope I have made myself clear this time, Is it clear?
In other words does this tax credit apply only to those with dividends, which seems unlikely, or does it apply to all?
If it only applies to those with dividends, perhaps I should buy a small amount of shares in order to arrive at a small dividend, and thus receive a tax credit for the balance in order to reduce my total tax bill.
If this tax credit applies to all, then does one have to claim it, or is it applied automatically?
Hope this is not being too stupid.
David
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19/05/2007, 7:46
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allanb
Joined on 04/09/2006
Posts 601
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Re: Treatment of Dividends
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No, unfortunately, the tax credit (if there is one) is "attached" to the dividend, and the smaller the dividend, the smaller the tax credit.
What I think we have established is that if you receive a dividend which entitles you to a tax credit, you may pay little or no tax on the dividend (because of the deductions) but still get the benefit of the tax credit.
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France Forum » Legal and Finan... » French Finance » Re: Treatment of Dividends
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