Pension charge exemption query
Will my wife be exempt from paying French social charges when she receives her pension?
My wife is 60 and will receive her English pension in March 2011. We have been resident in France since July 2006, living on private pensions from our previous business in UK which we sold prior to coming to France. We have no property in UK, but still pay tax on our private pensions, although we have now applied to receive it free of UK tax.
We have been paying tax and social charges in France since our arrival and received our cartes vitales in autumn 2007 on the grounds of residency. Will my wife be exempt from paying French social charges when she receives her pension in March and will the same apply to me when I receive my pension in a few years time? If so, how do we
go about informing the French tax authorities? CM
THE issue with the social charges is that you are exempt from paying them on all pensions income that is directly assessed in France, which therefore excludes so-called
“government income” such as that from the forces, the civil service, teaching and some health service pensions.
The old age state pension is treated as an ordinary pension.
Therefore, once either you or your wife receive the old age pension, neither of you will be liable to the social charges on your pension income. The exemption to the social charges on pension income therefore applies irrespective of whether one of you, or both of you, are in receipt of the old age pension, since taxation in France is joint.
With regards to declaring this, income from pensions is declared not only on the 2047 tax form, but also on the 2042 tax form, and the tax offices now usually know that foreign pensions are exempt from the social charges.
Some tax offices still require the pension income to be inserted in section VIII on the 2047 form, but then you need to add a comment about not being due to pay the CRDS as the tax declaration form does not follow the logic of the Notes that accompany this form.
Irrespective, if you should be assessed to the social charges; it is just a question of a simple letter to point out the contents of Note 17 of the Notes pack that comes with the form, to obtain a credit.
