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Seeking Advice – Couple moving to France to live but both working in France

Seeking Advice – Couple moving to France to live but both working in France

Old Jan 22nd 2018, 1:18 pm
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Default Seeking Advice – Couple moving to France to live but both working in France

We’re moving to France. That’s the good news. The financial side seems such a challenge at the moment. I’ve read so many websites and pleased I found this forum. I’ve took some financial advice, I’ve even asked my UK accountant, a British speaking French Accountant and the particular circumstances mean I’m getting mixed replies so it’s a clear as mud at the moment…..help lol.

We have owned our house in France for 7 year and downsized in the UK ready for retirement. We were not planning on moving yet but you’ve guessed it, Brexit has brought our plans forward to secure residency rights. The current plan is to move on 1st December 2018 giving us 4 months to secure a Carte de Sejour UE and register with as many French authorities as we possibly can…lol

We are retaining our house in the UK for now with a view of renting it out. Finally once the Brexit dust settles we will sell it.

I’m a self-employed IT consultant working for my own limited company and would like to return for short contracts in the UK so maintaining my French residency of more than 183 days in each calendar year.

My wife is permanent working in an IT support role and as such can work remotely. She’s hoping to get permission to work from our home in France.
So what about Income Tax and Healthcare, and what’s the most financially efficient approach for both of us. We would prefer our healthcare to come from France for convenience and security.

For me each time I return to the UK to work it would be as a temporary worker for up to 5 months in a calendar year. I would be returning as much as possible at weekends when practical using budget airline. Do I keep the UK Company, can I enter the French healthcare system, do I register as self-employed in France and what’s the best regime etc. Am I a cross border work, Dual Resident etc….so many tests.

For my wife I believe her employer would have to register as employing a French citizen and pay employer social charges to France. They may be reluctant to do this as they will be worse off so we need to know if there are alternatives. Ultimately she would take a pay cut to offset her employer being out of pocket to secure her job working from France if necessary.
Advice appreciated and also can anyone recommend a Financial Advisor to help. I read Pelican Consulting are good.

Our objectives are simple. Become resident before Brexit so achieve the more than 183 days in France in Calendar year 2019 but start this from 1st December to make sure.

Thank you in advance.
Kevin
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Old Jan 22nd 2018, 2:42 pm
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

Hello Kevin,
Welcome to the forum.
Don't get hung up on the 183 days.
You can spend less that 183 days in France but still be tax resident in France.
If your centre of economic activity (i.e. where you earn money) is in France or your home (or main home) is in France then you are tax resident in France. If you move to France with the intention of living there then you are tax resident from day 1 - not after 183 days.
You can earn money in whichever country you want but if you are tax resident in France you would have to declare all money earned and any tax paid on your French tax return.
In addition, you do not complete an individual tax return in France but a family tax return and if your wife is tax resident in France then you would be also.
IMHO you will not get definitive tax advice on a forum like this - great for other advice but finance advice is complicated - especially falling between two sets of tax rules.
You need to find an accountant who is up-to-date with both UK and French tax laws.
Good luck
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Old Jan 22nd 2018, 2:46 pm
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

Originally Posted by cyrian
Hello Kevin,
Welcome to the forum.
Don't get hung up on the 183 days.
You can spend less that 183 days in France but still be tax resident in France.
If your centre of economic activity (i.e. where you earn money) is in France or your home (or main home) is in France then you are tax resident in France. If you move to France with the intention of living there then you are tax resident from day 1 - not after 183 days.
You can earn money in whichever country you want but if you are tax resident in France you would have to declare all money earned and any tax paid on your French tax return.
In addition, you do not complete an individual tax return in France but a family tax return and if your wife is tax resident in France then you would be also.
IMHO you will not get definitive tax advice on a forum like this - great for other advice but finance advice is complicated - especially falling between two sets of tax rules.
You need to find an accountant who is up-to-date with both UK and French tax laws.
Good luck
Thank you. Yes understand all this as read all the residency test and lots more. It's the detail we need to get to now so hoping to find someone in a similar position as us and learn from their experiences. I realise about the centre of economic activity and since we have a house in both countries this is a grey area, so to make sure we secure out EU residency rights we will stay in France for more than 183 days.

I've read a few thread of people in similar positions as us so sure someone will come along with some good advice.

Thanks
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Old Jan 22nd 2018, 3:18 pm
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

I don't know if it is any good for you but the "France Show 2018" is on at Olympia, London from 26th to 28th January.
You may find accountants there.
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Old Jan 22nd 2018, 3:27 pm
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

Originally Posted by cyrian
I don't know if it is any good for you but the "France Show 2018" is on at Olympia, London from 26th to 28th January.
You may find accountants there.
Unfortunately just the usual ones such as Blevins and Spectrum. Looking for more in depth knowledge really. We went to one many years ago.
Thanks
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Old Jan 22nd 2018, 4:45 pm
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

Healthcare for workers is governed by detailed EU directives, you don't get a choice which system you pay into. Basically the rule is that you are covered by/contribute to the social security system of the place where you work, which is also normally the place where you live. The place where you work is the place your bum is when you do your professional activity, not where your employer or your clients are, so working remotely from France=working in France. If you live and work in different places, that would normally make you either a cross border worker (live in country A, travel across a border to work in country B) or a posted worker (normally live and work in country A but temporarily sent to work in country B). In both of these cases, your status needs to be confirmed by HMRC and they need to issue the appropriate paperwork, ie an EU portable health document A1 or whatever its number is. HMRC will examine your situation and make the decision based on various factors, primarily your future working pattern. I don't know whether the UK will still issue EU portable health documents post Brexit.

It's not just about being in France, it's all about correctly exercising your EU right to freedom of movement. Depending on what your status (worker, inactif), the requirements are different. Any time you spend in France on holiday/under the radar with no clear status and not exercising your EU rights correctly, will not count as legal residence / carte de séjour. The papertrail is what matters because that's what they look at when you apply for a carte de séjour. You need to be submitting your tax returns here so you can show your avis, and you need to be in the social security system one way or another so you can show your attestation.

Hope that helps for starters.
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Old Jan 22nd 2018, 7:23 pm
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

Thank you. That supports my research. My position is the confusing one. I’m s self employed IT consultant. My plan is to be in France for 6-7 months a year then return to the UK for short contracts. I’ll probably be returning most weekends. So the question is what’s the most tax efficient way of working. Do I use a uk registered company. Am I considered uk a Tax Resident as I will be spending more time in France.
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Old Jan 22nd 2018, 8:47 pm
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

Originally Posted by Kev946
Thank you. That supports my research. My position is the confusing one. I’m s self employed IT consultant. My plan is to be in France for 6-7 months a year then return to the UK for short contracts. I’ll probably be returning most weekends. So the question is what’s the most tax efficient way of working. Do I use a uk registered company. Am I considered uk a Tax Resident as I will be spending more time in France.
The most tax efficient way of working (if you count social contributions as tax) as a small business/self employed worker would without a doubt be to stay UK resident and use a uk reg co.

But you say your objective is to become resident in France.

So what would your status be in France? In what way would you, as the owner of a UK reg co working in the UK, be exercising your EU rights? You wouldn't be a worker, you wouldn't be an inactif. If HMRC accepts that you're a cross border worker that would give you a status up til Brexit at least but could be a bit tenuous...
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Old Jan 22nd 2018, 9:32 pm
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

If I continue with the uk company I would be dual resident as I would pass the residency test in the uk and France, being more than 183 days in France. Then would need to apply under the double tax treaty.

So yes you might be right, keep working in the uk. However it’s preferable as I’m not too far from retirement to be in the French social system so what’s the best way of doing that?
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Old Jan 22nd 2018, 9:58 pm
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

Dual residency doesn't actually mean that you're resident in two countries. As you say it means you pay tax in 2 countries as per the DTA. But you only declare worldwide income i one country, which is the country where you're resident. The deciding factor, everything else being equal, is the country of which you're a national.

As said, the 183 day rule is an urban myth for France, it's not one of the residency criteria.

Sorry to keep saying it, but if you're not correctly exercising treaty rights then even if you are paying tax in France and spending 190 days a year here, I don't think it will help with claiming residency when the time comes.
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Old Jan 22nd 2018, 10:08 pm
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

But isn’t test 2 France is your principal place of abode, your lieu séjourprincipal. This usually means you spend more than 183 days in France per calendar year, or you spend more days here than in any other country.

Surely if we doing tax returns in France, staying there more time than the uk and have declared our house in France as our main residence then we are French Resident. We also intend on applying for a Carte de Sejour UE.
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Old Jan 23rd 2018, 4:37 am
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

For all I know at the moment you declare yourself residency in France you will have to pay taxes
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Old Jan 23rd 2018, 5:47 am
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

Originally Posted by amy23
For all I know at the moment you declare yourself residency in France you will have to pay taxes
Not necessarily. We have the double tax treaty
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Old Jan 23rd 2018, 8:16 am
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

Originally Posted by amy23
For all I know at the moment you declare yourself residency in France you will have to pay taxes
Just to clarify - you cannot choose your tax residency.
You will be "tax resident" if the rules say that you are resident.
In France, the FISC will decide. If you disagree, then you can appeal to HMRC and the two tax authorities will decide between themselves and inform you accordingly.
Normally, it is clear cut but some situations are complex.
You can consider yourself tax resident in a country but it is the rules that decide.
As ET has said, you do not have to pay your taxes in that country but the final declaration and any final payment must be made in the country of residence.
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Old Jan 23rd 2018, 8:37 am
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Default Re: Seeking Advice – Couple moving to France to live but both working in France

Originally Posted by Kev946
But isn’t test 2 France is your principal place of abode, your lieu séjourprincipal. This usually means you spend more than 183 days in France per calendar year, or you spend more days here than in any other country.
I just re-read your first post and I see you're intending to rent out your home in the UK, so in fact if it's rented out from the moment you come over, you would be in a stronger position. My point was that if you meet both sets of residence criteria then you can't unilaterally decide to ignore any claims HMRC has on you, it would have to be agreed by both tax authorities and getting out of HMRC's clutches can be quite sticky. If your house isn't rented out then under 2c of the tax treaty:
"if he has an habitual abode in both Contracting States or in neither
of them, he shall be deemed to be a resident only of the State of
which he is a national"
https://www.gov.uk/government/upload...-_in_force.pdf

If it is rented out and you stay in hotels all the time you're in the UK, that wouldn't apply. It would in any case be an unusual situation if HMRC wanted to class you as resident in the UK because tax is normally done on a household basis in France, and if your partner's company puts her on a French work contract she would be 100% solid resident here, so that may help you too. But it's not totally clear cut, and if you want HMRC to treat you as non resident and give you cross border worker status, rather than continuing to treat you as resident, then you will have to convince them that you are a "leaver".

I assume you've already studied the provisional agreement on workers rights
https://ec.europa.eu/commission/site...ison_table.pdf
"Those who are working as a frontier
worker on the specified date fall within
the scope of the Withdrawal Agreement
for as long as they retain the status of a
frontier worker in the State of work. Such
workers retain the rights they currently
enjoy to enter and to work in the State of
work. The rights they enjoy in their
country of residence, including the right
to work, are similarly protected.

A frontier worker, as defined in EU law, is
a UK national or an EU citizen pursuing
genuine and effective work as an
employed or self-employed person in one
or more States and who resides in
another State (irrespective of whether the
person also works in the State of
residence), unless or until they no longer
retain the status of a worker in the State
of work (equivalent to that as defined in
Directive 2004/38/EC) or they cease to
work across the frontier into the State of
work in accordance with Articles 45 and
49 TFEU and Regulation (EU) No
492/2011."
So if HMRC agrees you are a cross border worker you should be fine as long as there is a deal. In the event of no deal, who knows, but if your partner's employer puts her on a French employment contract, salarié may be a more secure status than cross border worker and you'd be a family member so that might help as regards residency. But whether you would still be able to go and work in the UK, if you are selling a service and services aren't part of the trade deal, qui sait.


Originally Posted by Kev946
Surely if we doing tax returns in France, staying there more time than the uk and have declared our house in France as our main residence then we are French Resident. We also intend on applying for a Carte de Sejour UE.
Unfortunately that doesn't compute. Qualifying for residency is a box ticking exercise, you need to meet certain criteria. You've probably read cases in the UK press about EU nationals who have been living and paying taxes in the UK for years, and now they're being refused residency on a technicality. If it was just a case of, live there and pay taxes and that is enough to make you resident, there wouldn't be all the angst and uncertainty and you wouldn't be reading those stories. Same in France, you can bet there are lots of Brits who've been living here 365 days a year and paying taxes here and have no home anywhere other than France, but they won't technically qualify for a carte de séjour under current rules because they haven't met all the conditions. The two likely technicalities are either that they're inactifs and their income hasn't consistently met the threshold, or that they don't have health cover.

Point being that just because you are living in an EU state, doesn't prove you are entitled to be. The authorities know there are EU citizens living here irregularly but it's tolerated. But it remains to be seen how much tolerance there will be for Brits after Brexit.

What I'm suggesting is, be aware that there is a big difference between living here regularly and living here irregularly. You can't assume that simply spending time here is enough, you have to make sure you tick the boxes. After 5 years' legal residence you qualify for full residents' rights, whereas no matter how long you may have lived here irregularly, it will never qualify you for any rights.

Another point to consider about paying tax is that if you move in Dec 2018, your French tax office probably won't want a tax return from you until April 2020 and you won't get your first avis d'imposition until around July 2020.

Last edited by EuroTrash; Jan 23rd 2018 at 8:56 am.
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