Xendo

Thanks, ctt, for your mention. I am also trying to get as much information from financial advisors, accountants etc. for clarification, in the next few days.
Since most of our clients are outside France, it is suggested that we could keep running our UK company as it is, so long as we declare our tax situation in France. Elsewise, 'moving' our company to France is a possibility, instead of a new start-up.
Just need some firm answers.

dmu

The short answer from me is, I don't know!
Many kind neighbours help others without monetary reward, but indoors, it's kept very discreet. If visible, it's "acceptable" by local professionals if the recipient is long-standing/poor/elderly for example. My 86 year old neighbour who was born in the village and on a small pension, gets a neighbour to work in her potager, and my gardener has never denounced them (to the URSSAF)...
For indoor household repairs, who would know? but you'd have to weigh up the risks of an accident before undertaking them.
No one would wonder why you're telephoning from some one else's house, let alone think that you're "working" for them.
All this is unofficial of course, based on experience. I've no idea what the Legislation is for such activities! Maybe ET can find a pertinent link....
P.S. I'd advise retirees who want to help others to join a French goodwill association. They all have the necessary insurance in case of an accident to or by their volunteers....

EuroTrash

I think you'll find that if the directors of a UK company move to France and keep running the business from there, the company will be automatically deemed resident in France, ie it is subject to French law and must be registered as a French entity etc.
The tax convention states
4. The term “resident of a contracting State” shall include where that Contracting State is France any partnership, group of persons or any other similar entity: (a) which has its place of effective management in France; (b) which is subject to tax in France; and (c) all of whose shareholders, associates or members are, pursuant to the tax laws of France, personally liable to tax therein in respect of their share of the profits of that partnership, group of persons or other similar entity.
https://assets.publishing.service.go...-_in_force.pdf

EuroTrash

To be honest I think this is a very grey area and is best steered clear of.
As dmu says, a retiree who wishes to help others would be better advised to volunteer through the proper channels and work with a charitable organisation. There are reasons why France has strict rules governing the setting up and running of charitable associations, and the reasons are basically to protect vulnerable people by ensuring that the organisations they turn to for support are fully accountable, and operates through volunteers who are vetted and trained.
I'm not clear what you mean by "a benevolent individual". Doing personal favours for friends is one thing, but it sounds as if you're thinking of a "benevolent individual" acting outside their circle of friends. How would such a person be accountable? I'm sorry but I'm not sure it's a good idea for vulnerable people to allow random unvetted individuals into their homes, especially if these people are going to do household repairs that they may or may not be competent to carry out safely. Again, "answering questions on the telephone" - I have no clue what this might mean. What questions would they be answering, on whose behalf, and who would be asking those questions?
I think working as a volunteer through the proper channels would be more fulfilling for everyone concerned. The volunteer would meet other people, they would have support, they would be able to make a valuable contribution with no risk of anything backfiring on them. The charity will be glad to have another helper on board supporting their work. And I'm sure most beneficiaries prefer to deal with a charity that's fully accountable, where they have a contact person and proper procedures and everything is done professionally and reliably, rather than have to feel obligated to an individual who is looking for ways to relieve the boredom of sipping Pims.

To answer your question - as long as all goes well then I don't see why anyone would have recourse to French legislation, but the minute anyone has a grievance against the "helper" -accusations of damage caused by poor quality repairs, accusations of unfair competition if the volunteer is assisting a business in any way, even accusations of theft by an elderly person who's got it into their head that the volunteer has stolen from them (happens a lot...) - then the accusation would be investigated and the helper would be on their own.

dmu

I assumed, rightly or wrongly, that TP was the "benevolent individual" in question!
I used to telephone for my English neighbour when she started to go deaf, so I can imagine scenarios when the hard-of-hearing, or expats of any nationality, can't speak on the phone and need help from a French-speaking neighbour. My elderly French sil is hard-of-hearing and living in a Résidence, without knowing any non-deaf neighbours. I suggested employing an "Auxiliaire de Vie" who could listen to messages and make all her telephone calls. There again, you have to have utmost trust in your helper, as they'll learn a lot of your private life....
As you say, household repairs is a grey area and IMO to be avoided by expats for the reasons given.

EuroTrash

Ah ok.
I'm probably overthinking it, but, doing something "for no monetary reward" out of friendship and goodwill makes perfect sense to me and I would have thought to most people, it's what friendship is about. Volunteering for a charity that exists to help people who need help "for no monetary reward" also makes perfect sense, it's what charities are about. Society would be poorer without friendship and charities. But I see something slightly uncomfortable in a relationship where person A is doing things for person B when A and B are not personal friends, person B is not paying person B, and person A isn't representing a charity. Maybe I caught the French disease of needing to pigeon-hole everything. But if I were person B, I would feel very awkward about that relationship. I'm certaiinly not shy about getting friends to help me out with things they can do and I can't, because that's what friends are for. I wouldn't have a problem asking for support from a charity because that's what charities are for. But accepting help from a stranger I would find difficult. I would feel obligated and I don't like that. I'd prefer to pay a professional.

Xendo

Hi EuroTrash, I think it is obvious that we pay tax in France because we are now living here, but is there a possibility of splitting the business itself (which is virtual anyway), so that our UK/US clients don't have to pay us in Euros (we have bank accounts in UK and France). Obviously we declare any income from the UK side in our French tax returns at the end of the year. I am still trying to get a straight answer from various French accountancy/business start-up firms, and will let you know if anything positive/definitive comes out.

dmu

It isn't simply a Tax question, it's the Social Contributions (Côtisations) which the URSSAF wants to receive from some one working in France. As ET says, "the law of bum" - where you're sitting working, there you pay into the S.S. System for healthcare, pension, etc... Which implies setting up a French business structure, or being "seconded" by your UK company (which involves financial obligations for its part, cf. #20 in the Read-Me: Moving to France FAQs above). Your situation is complicated - have you consulted a French Expert-Comptable familiar with seconded employees from another EU country? (You should sort this out before the Brexit deadline...)
HTH

Moses2013

I would have assumed these rules apply:

https://ec.europa.eu/social/main.jsp...=851&langId=en

You work in more than one country

• If you pursue a substantial part of your activity, at least 25%, in your country of residence, you will be covered by the legislation of that country.
• If you don't pursue a substantial part of your activity in your country of residence, you will be covered by the legislation of the country where the registered office or place of business of your employer is situated.
• If you work for several employers, whose registered offices are in different countries, you will be covered by the legislation of your country of residence; even if you don't pursue a substantial part of your activity there.
• If you are self-employed and you don't pursue a substantial part of your activity in your country of residence, you will be covered by the legislation of the country where the centre of interest of your activities is situated.
• If you pursue an employed and a self-employed activity in different countries, you will be insured in the country where you are employed.

EuroTrash

Why would your UK/US clients have to pay you in euros?
As a French business you can invoice clients and be paid in any currency you choose. When I worked in France I had a couple of UK clients who always paid in pounds sterling, and the occasional client in the US and elsewhere who paid in dollars. You don't have to split the business. All you need is accounting software that can cope with multiple currencies.
Obviously, payments in foreign currencies have to be converted into euros when you declare them to the French authorities. My software used to do this automatically, if not you would have to do the calculation manually but it's no big deal.
I recommend looking at Transferwise Borderless for your banking. You can set up accounts in different currencies. You could for instance have £, $ and €, which is what I did. It's very easy to convert your money and move it around, either between your various Transferwise accounts or into your high street bank.
https://transferwise.com/gb/borderless/ (they also do business accounts if a freelancer account doesn't meet your needs)

I don't see any need to split the business unless you will in fact be splitting your working time between the two countries, in which case the rules Moses quoted will apply.

Xendo

My brain hurts and I haven't started filling in any registrations yet!
Because we are desk-based graphic designers, we are now presumably resident in France. I also am aware that we will have to pay Côtisations as soon as we register in France.
We will have to set up some form of company here in France (probably a SARL) to satisfy the "law of the bum".
Our main problem is, basically, how do we treat our non-French clients who make up 99% of our income – although our Belgian clients also pay in Euros into our French bank account (e.g. for the past 6 months our income can be split roughly into UK 63%; Belgium 21%; US 15%; France less than 1%). If we have a French company only, can we still have our US/UK clients (78% of our income) paying Sterling £ into our UK business bank account (which they would prefer) and which could then be declared at the end of the year?

EuroTrash

See previous post.
It matters not one jot where your clients are or what currency they pay you in. I'm not sure why you seem to think that French businesses are only allowed to deal with French customers?

I was a translator, registered as a micro entrepreneur, and I worked online for clients all over the world. It was no more complicated than if all my customers had lived in the same street as me.

Xendo

Understood, EuroTrash. Everyone can pay into new business, using the currency they want, and we will convert it in our accountancy programme going forward, just as we have been converting Euros to Pounds while we were in UK, when we declared Euro transactions.

Because of the forced timing of our arrival to France (post-lockdown/pre-Brexit), it must follow that tax for work done BEFORE we arrived in France, will have to be declared in the UK, from our UK partnership, using our UK accountant; and the rest will have to be declared in France, from our new French company, using our future French accountant.

EuroTrash

One thing to be aware of is that you need to make a separate monthly declaration to the French Customs, of any services provided to customers in other EU states during the previous month. Obviously this won't include the US, nor the UK after Dec 31st, but it would include Belgium.
You can do it online, not complicated, takes a few minutes. It's just a case of being aware you have to do it (the obligation was brought in shortly after I'd set up my business and it somehow bypassed me completely, and I discovered about two years later that I should have been doing it!), and then remembering to do it. You need an intracommunity VAT number which you get from your tax office.
https://www.douane.gouv.fr/fiche/la-...e-services-des

EDIT - just seen your last post. If you use an accountant I guess you can leave all that up to them.

EuroTrash

Yes-ish.
For income tax purposes, France will count you as tax resident from the date you arrived. Next April/May you will fill in your first income declaration, state your arrival date in France and declare all your worldwide income between that date and 31.12.2020. So that side of things should be easy.
The UK however will probably fry your brain telling you to read and understand all their complicated rules on the various scenarios in which you can and cannot claim a split tax year. Depending how many days you spent / worked in the UK between April 2020 and April 2021 you may end up not being able to claim a split tax year and being classed as UK tax resident for the whole of the UK tax year 2020/2021 even if you left the UK part way through, thus making you dual resident for part of the year. If that happens you'll have to declare worldwide income for the whole of that tax year to the UK (meaning that you end up declaring some income in both the UK and in France for French tax year 2020, and the same again in French tax year 2021) and hope that HMRC works it out right. This is an especial pain because you can't declare foreign income to HMRC using their normal online system, you have to either use special commercial software which isn't cheap, or fill in a paper return.
Though if you use an accountant, hopefully (s)he will understand HMRC's split tax year concept, and will also have the required software, and will be able to do the calculations so that you're not at HMRC's mercy like I was.. I had endless fun with them when I moved back to the UK part way through a tax year. I filled in a paper return because I was damned if I was going to fork out for software just to do that, and it took nearly a year to get it sorted out. They fined me, I put in a complaint, and in the end they refunded my fine and compensated me for their mistakes and we ended up the best of friends for a few weeks until they started again sending me demands for payments they'd just apologised for asking for and assured me I didn't have to make so good luck with that.