Advice on Capital Gains Tax Please.
Jan 13th 2012, 10:11 am
#1
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Joined: Jan 2012
Posts: 2
Advice on Capital Gains Tax Please.
I have reposted this with the better title.
I need a little help regarding CGT and hope i can get some clarification please!!
I live here in France with my partner. I am a newly registered French enterprise and my partner is running a business based in the uk and pays taxes in the uk and his business is registered in the uk at this moment in time.
We both live full time in France and our daughter goes to school here, we love France and would never move back to the uk but have now outgrown our Home and need a larger place.
We purchased our place for €17,000 3 1/2 years ago and have a chance of selling for €80,000 all work was done by us and no registered artisans have been involved.
My question is, we want to purchase another house in France with the proceeds of the sale of our present home and wondered are the capital gains taxing scales still the same for a repurchase in France ? ( do we have to pay it if the money is going into another French property ) just so we can work out exactly what budget we would have to purchase anoher property?
Without wanting to confuse the post my partner pays our tax fonciere and habitation tax and it is his name on it only.Not sure if this may be a problem also.
Any constructive answers, advice at all would be very welcome.
Thank you
I need a little help regarding CGT and hope i can get some clarification please!!
I live here in France with my partner. I am a newly registered French enterprise and my partner is running a business based in the uk and pays taxes in the uk and his business is registered in the uk at this moment in time.
We both live full time in France and our daughter goes to school here, we love France and would never move back to the uk but have now outgrown our Home and need a larger place.
We purchased our place for €17,000 3 1/2 years ago and have a chance of selling for €80,000 all work was done by us and no registered artisans have been involved.
My question is, we want to purchase another house in France with the proceeds of the sale of our present home and wondered are the capital gains taxing scales still the same for a repurchase in France ? ( do we have to pay it if the money is going into another French property ) just so we can work out exactly what budget we would have to purchase anoher property?
Without wanting to confuse the post my partner pays our tax fonciere and habitation tax and it is his name on it only.Not sure if this may be a problem also.
Any constructive answers, advice at all would be very welcome.
Thank you
Jan 13th 2012, 1:15 pm
#2
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Joined: Jan 2012
Location: Cote d'Azur
Posts: 14
Re: Advice on Capital Gains Tax Please.
Hi,
I researched this same qtn some wks ago and to my knowledge, there is no CGT on your primary residence. We have a house in the UK which we rent out and our French bank deem that house to no longer be our primary residence as we are now residents in France permanently. I take it that the house you are selling for 80K€ is your 'Primary Residence'?? I don't see where your work/business has to come into it really or am I missing something....
I researched this same qtn some wks ago and to my knowledge, there is no CGT on your primary residence. We have a house in the UK which we rent out and our French bank deem that house to no longer be our primary residence as we are now residents in France permanently. I take it that the house you are selling for 80K€ is your 'Primary Residence'?? I don't see where your work/business has to come into it really or am I missing something....
Jan 13th 2012, 1:20 pm
#3
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Joined: Jan 2012
Location: Cote d'Azur
Posts: 14
Re: Advice on Capital Gains Tax Please.
I've just found this quote on Capital Gains Tax on Wiki
'France
For residents, capital gains tax on the sale of financial instruments (shares, bonds, etc..) is a flat 32.3%, which includes 12.3% of social security taxes. If shares are held in a special account (called a PEA), the gain is subject only to social security taxes provided that the PEA is held for at least five years. The maximum amount that can be deposited in the PEA is €132,000.
The gain realized on the sale of a principal residence is not taxable. Also, a gain realized on the sale of other real estate held at least 15 years is not taxable, although from 2011 this will become subject to 12.1% social security taxes. (There is a sliding scale for non principal residence property owned for between 6 and 15 years. The taxable gain is reduced by 10% for each full year that the property was held, starting at the fifth year. For example, on a property owned for between 6 and 7 years, 90% of the gain is taxable; on a property owned for between 11 and 12 years, 40% of the gain is taxable.)
Non-residents are generally taxable on capital gains realized on French real estate and on some French financial instruments, subject to any applicable double tax treaty. Social security taxes, however, are not usually payable by non-residents. A French tax representative will be mandatory if you are non-resident and you sell a property for an amount over 150.000 euros or you own the real estate for more than 15 years.'
Hope this helps
'France
For residents, capital gains tax on the sale of financial instruments (shares, bonds, etc..) is a flat 32.3%, which includes 12.3% of social security taxes. If shares are held in a special account (called a PEA), the gain is subject only to social security taxes provided that the PEA is held for at least five years. The maximum amount that can be deposited in the PEA is €132,000.
The gain realized on the sale of a principal residence is not taxable. Also, a gain realized on the sale of other real estate held at least 15 years is not taxable, although from 2011 this will become subject to 12.1% social security taxes. (There is a sliding scale for non principal residence property owned for between 6 and 15 years. The taxable gain is reduced by 10% for each full year that the property was held, starting at the fifth year. For example, on a property owned for between 6 and 7 years, 90% of the gain is taxable; on a property owned for between 11 and 12 years, 40% of the gain is taxable.)
Non-residents are generally taxable on capital gains realized on French real estate and on some French financial instruments, subject to any applicable double tax treaty. Social security taxes, however, are not usually payable by non-residents. A French tax representative will be mandatory if you are non-resident and you sell a property for an amount over 150.000 euros or you own the real estate for more than 15 years.'
Hope this helps
Jan 13th 2012, 2:16 pm
#4
Forum Regular
Joined: Jul 2007
Location: 61 Normandy
Posts: 297
Re: Advice on Capital Gains Tax Please.
If you have been declaring your taxes in France as a household since you arrived then there should be no problem proving the house is your principal residence, hence no CGT.
