I live in France but my earnings arise in UK: Where to pay income tax?

As France is where you reside, it is to France that you should be declaring your worldwide income and paying whatever tax is due – and the social charges – and not the UK

16 August 2021

'Double tax treaties prevent the paying of double taxes in two countries and they allocate the taxation of income to the country in which one is resident' Pic: Pcess609 / Shutterstock

Reader question: I live in France and am paying income tax in the UK because all my income arises there. Should I be paying in France as well, despite not having any French income? 

In short, no, not as well, though perhaps you should be paying it in France instead.

Double tax treaties prevent the paying of double taxes in two countries.

However, whether your income should be taxed in the UK is another thing. It is not because income arises in the UK that the taxation of UK income should occur in the UK.

The double tax treaties allocate the taxation of income to the country in which one is resident.

Accordingly, as you are resident in France, it is to France that you should be declaring your worldwide income and paying whatever tax is due – and the social charges – and not the UK.

This said, the double tax treaty does provide that some income sources do, nonetheless, remain taxable in the UK:

  • UK rental income, as anything to do with real estate will always be dealt with first in the country in which this property is situated;
  • ‘Government’ income, such as diplomatic service and military pensions and pensions from most of the emergency services and public teaching – because the income emanates from the government;
  • UK salaries or self-employed income, as long as the work for this is not carried out in France.

Despite the UK taxation of these sources of income, these still have to be declared in France for inclusion in the overall tax calculations.

A tax credit is then given to nullify the inclusion in the calculations, though the inclusion may push the taxation of other French-taxable income into higher bands.

So there should be a French income tax declaration, whatever your situation, for the simple reason that you are resident in France.

There is also the Form France Individual DT to be completed as an application for relief at source from UK income tax and to claim for repayment of UK income tax. This should be sent to your French tax office, once you have a French numéro fiscal tax number, for them to counter-sign the English version to return to you to send to HMRC.

This notes the sources of income that you have, and any overpaid tax up to the last April 5 will be refunded directly by HMRC. Any tax overpaid since then will be refunded through the PAYE system.

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