Greener56

Hi can anyone tell me if it’s 6 months grace you have to sell your U.K. home before becoming liable to pay CGT in France. I know it’s 9 months from the UK’s prospective as we’ve confirmed that with HMRC.

Also is the 7.5% solidarity tax payable on any profit you make on the sale even if you do manage to avoid the CGT? Hoping there is someone on here who’s maybe been there done that type thing.

Many Thanks

EuroTrash

I think it's more complicated than that. The UK and France have different rules and there are various factors involved - from France's side I believe factors nclude how long did you own the house, was it put on the market before you moved, have you let it out since you moved, and probably other things too..
You should get professional advice on this based on your individual circumstances.

Greener56

Thank you. We are waiting to hear back from Blevins to see what their charges are for advice etc so we’ll wait to see what they say then.

EuroTrash

This outlines how it works in France https://www.service-public.fr/partic...0%20b%C3%A2tir.
but I would still recommend taking advice to be sure that you are intepreting it correctly. Probably you should also refer to the France-UK tax treaty which may also have a bearing.

Greener56

Thanks. Just had a quick look using google translate as French isn’t that far advanced. However there’s too much to try and take in when you’re cutting and pasting paragraphs. Hopefully Blevin Franks get in touch tomorrow and we can pay to have some tax advice. Think that’s the best way.

Tweedpipe

Do your research. Your eventual experience and feed-back could assist others.

Greener56

Yes indeed. We have already found out so much that maybe other people are not aware of but it seems we think we’ve found out everything and then along comes another curve ball. Things like having to make sure you make a French Will stipulating you want your English Will to be executed otherwise your Spouse could lose the right to the marital home and it would go to the children of your partner from their first marriage! So much to be aware of.

dmu

Is there a missing? If it wasn't said tongue-in-cheek as an example, and actually corresponds to your matrimonial/family situation, then you should consult a Notaire who will find the best way of protecting every one's interests. All French property is subject to Taxes de Succession, whoever it is bequeathed to in a UK Will.
In France, depending on the Régime Matrimonial, a spouse normally has usufruct, if not a percentage of the value of the Estate, and unless the former "partners" were legally bound and the survivor adopted his/her children from his/her first marriage, those children, being unrelated to the deceased, would have to pay 60% of the value of their share of the Estate (within 6 months of the decease), if they are named in a Will. All very complicated, as it isn't clear who is male and who is female...
HTH
(If the high-lighted part was simply an example, take no notice of the above! But if it does concern you, consult a Notaire!)

cyrian

Sorry,
I am confused.
Are you saying that you have to sell your home within this time period or that you have to pay the tax in this time period after the sale?
In the UK, there was a change in the law for CGT in April 2020.
If there is CGT due to be paid in the UK when a property is sold, the CGT must be paid within 30 days.
CGT payment
Previously, the tax had to be paid by January 31st following the sale.
The CGT exemption in 2020-2021 is £12,300 per person or £24,600 per couple and the net gain is calculated using inflation over the period of ownership.
The gain and the tax already paid should be declared to the FISC who will calculate the taxes due.
The UK France Double Taxation Treaty means that you will not be taxed twice on the gain and the tax already paid will be deducted after the FISC calculation.
France does not use indexation but a sliding reducing tax rate depending on the period of ownership.
Which report
Please note the difference between 2019-2020 and 2020-2021.

EuroTrash

I think the OP is asking about liability, rather than payment timescales. How much leeway is there if you still own your UK home when you move to France but you sell it soon after moving, so although it is technically a second home at the time of the sale because you now live somewhere else, you are still allowed the exemption on the grounds that it was your main home until very recently.
France has various plus value exemptions, not sure if the OP would qualify for one of those. But don't know whether it is actually written in black and white how long they will agree to class it as a résidence principale and therefore exempt; after you have moved out. I have heard that if you rent it out you are automatically disqualified from any exemption and I have also heard there is considerable discretion and if you can show that you put it on the market before you moved out, and have been trying to sell it ever since, they will sometimes be quite generous - up to a year or more?.

Greener56

Yes as Eurotrash states my initial question is about the time scale allowed in order to sell your property and not about how long you have to pay any tax. To make it clearer OH is moving to France 1st December into rented accommodated in order to establish residency and I will be going over early part of next year. The house will then be put on the market and therefore it will be classed as a second home as we will be resident in France. If we sold before August the UK would not impose any CGT on us so we wanted to know the French stance and someone said 6 months which would mean we have to sell by May in order not to incur CGT in France. We will be getting proper tax advice but I just wondered if anyone on here had been through this process recently.

Greener56

Hi, sorry for any confusion with my example. Basically we are married and my husband has children from first marriage and I do not. Our current Wills states whoever dies first then the remaining spouse gets everything. Then when that spouse dies the house and anything else is split between his children and some of my relatives with his children getting a bigger share. Therefore we now know we can draw up something with the Notaire that basically states that when one of us dies the wishes in the UK Will are you be carried out.

EuroTrash

The issue there is not so much that your UK wills are carried out, that's easy enough (in theory), but what's more complicated is to arrange things so as to minimise the French succession tax that you might otherwise make yourselves liable to. Notaires are the experts at this, they'll tell you what can be done.

Greener56

Yeah we’ll definitely be getting professional advice on this amongst other things. However can I ask when you say succession tax do you mean tax that might have to be paid after one of us dies or when we’re both gone and it’s the beneficiaries so to speak?

EuroTrash

Succession tax is calculated on each separate inheritance..
So when the first partner dies, each of their heirs may be liable to pay succession tax on what they inherit from that person.
Ditto when the second partner dies.