• You live in France and are a tax resident of France?
Regardless your nationality, you have to declare all your world income, whatever its source or country of origin.
Depending on the source and the country of origin, income is treated and taxed differently.
In case of doubt about your residence, or if you could be considered a resident of two countries, the provisions of the Double Taxation Covention apply.
Let's take some examples of income from the UK:
Rental income from property and certain other foreign income sources, such as public sector pensions or income from a foreign activity, must continue to be taxed in the UK, but you must still declare the taxable amount on your French return. It will not be taxed again in France under the double taxation treaty, but it will be taken into account to determine the rate at which other income should be taxed, and will have the effect of pushing your other income into a higher tax bracket.
Other pension income from private pensions and foreign state pensions is taxed in France and must be paid gross in the source country.
For the following types of income such as pension lump sums, tax-free investments, dividends from foreign shares, premium bonds, offshore bank interest, capital gains tax and rental of gîtes, it is advisable to seek help in completing your tax return.
• You live abroad and have French assets?
Regardless your nationality, you only need to declare income from French sources, even if they did not generate any revenue. Some of these assets will be taxable and some will not.
The main categories considered as income from French sources are:
- Income from real estate located in France or rights related to such property;
- Income from French movable property and all other shares and securities invested in France;
- Income from professional activities, whether employed or not, carried out in France or from transactions for profit carried out in France;
- Capital gains from the transfer of property rights when linked to businesses operated in France, as well as immovable property located in France;
- Capital gains from the transfer of corporate rights related to companies having their head offices in France.
This list is not exhaustive, and for any other income not listed, please contact our tax team.
• Double Taxation Treaties
Double taxation treaties serve to avoid double taxation of income earned in one country by a resident of another country. They also clarify the taxing rights between two countries on different types of income from cross-border economic activities. The agreements also provide for tax reductions or exemptions for certain types of income.
For specific information on double taxation treaties, please contact our tax team.
• Tax forms
There are many different forms, but here are a few references that often apply to the expatriate community:
- Form 2042: this is the main tax from, which should include all of your worldwide income and gains.
- Form 2042 C (supplementary): this is a supplementary form, needed in serveral cases. The main ones are if you have any income from a personal business, such as furnished lettings or if you have paid tax in another country that needs to be offset against French tax.
- Form 2047: this form, which must be completed by anyone who receives income from abroad, contains details of this income, even if the figures have already been mentioned on the main form 2042.
- Form 3916: this is necessary if you have any bank accounts outside France, as you must provide these details annually.
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