Questions asked on social charges
The full impact of a recent EU court ruling on matters like income from investments remains to be fully clarified
CONNEXION has received enquiries from readers with regard to the levying of French social contributions on investment income of British pensioners in France.
This issue has arisen following a European Court ruling in February relating to the social contributions CSG and CRDS and which is expected to be extended to another three similar levies, totalling 15.5%, on income from investments and property.
The ruling stated that people who are subject to one EU country’s social security system should not have to pay the social charges on income from property in another EU country.
One impact, as we reported (see link below), is expected to be that non-residents who have investment or holiday homes in France should no longer have to pay the social contributions on their property capital gains and rental income and it may be possible for reclaims to be made for past years (see second link, below and the current edition of Connexion, page 3).
However the question has now also arisen as to whether British state pensioners in France, whose healthcare is paid for by Britain via an S1 form, may also be able to take advantage of the ruling so as not to pay social charges on property income and income from their investments (so-called ‘moveable property’).
This could include, for example, bank interest or income from shares.
The precise impact of the court ruling is awaiting a decision by France’s Conseil d’Etat and in turn is expected to have to lead to new French legislation to put the changes into law.
At present the situation therefore remains unclear, however it does not significantly affect how you declare your 2014 income this spring.
We would however, as mentioned in our guide How to Complete Your 2015 Tax Forms, recommend that if you have the S1 form due to being a UK state pensioner, you draw attention to this fact in the Notes section (section E) of the main income tax form.
The guide is now available for download or order as a printed copy at: Helpguides.
Previous stories:
Non-residents’ social charges ruled illegal
Claim back social charges
