Friday, March 28, 2008

Becoming a resident of France?

Legal Living in France
By Melissa Schulz

It took me six months to figure out the appropriate steps to take to live in France legally. The options are: finding a French employer who will arrange a visa, marrying a French citizen, joining the Foreign Legion, or becoming a student. The last option seemed to be the easiest and less emotionally exhausting.

All you have to do is sign up at one of the French for foreigners schools in Paris recognized by the French government (below), present your registration card at the French consulate in your home state, and get your student visa. All the schools offer programs to suit your level and needs, and some offer aid with the paperwork and housing. Request catalogues from each school and review them carefully before making a decision. (The Sorbonne is the most popular and least personal; it is also least expensive.)

After deciding on the school, you can register by phone, email, or fax. If you are in France, go directly to the school and preregister, then obtain your visa back in America. You must sign up for at least 20 hours of French a week to apply for a visa. Sign up for one year if you want a long-term student visa. Depending upon the school, you may have the option of making payments instead of paying all fees at once.
The next step is to go to the French consulate in your state of residence with all the necessary papers. The documents you will need vary from state to state, so check your local consulate web site.

Once in France, the first thing you need to do is get your Carte de Sejour at the police prefecture. Take with you to the prefecture: your final registration at the school of your choice (which you receive after taking your placement test), proof of payment of tuition, and proof of health insurance. If you are over 28, you have to get private coverage, which you can buy in France or America. Look in Fusac, www.fusac.fr a journal for English-speaking residents in France, and carefully compare prices. Take your insurance ID card, proof of residence, and proof of financial support to your local prefecture. The required documents vary, so ask your school to help you with the process. If you have the option, bring a French person with you.

Once you have your Carte de Sejour and you are legal you can open a bank account, get a mobile phone, and find part-time employment more easily. Try to start the process at least two months in advance of your departure. The peace of mind is worth the pain.

French Schools for Foreigners

Institut Catholique de Paris, 12 Rue Cassette, 75006 Paris; 011-33-01-44-39-52-68, fax 011-33-01-44-39-52-09; ilcf@icp.fr, www.icp.fr.

La Sorbonne, 47 rue des Ecoles, 75005 Paris; 011-33-01-40-46-22-11, fax 011-33-01-40-46-32-29; ccfs@paris4.sorbonne.fr, www.fle.fr/sorbonne. Cost per semester (20 hours a week for 12 weeks):

Alliance Francaise, 101 Blvd. Raspail, 75270 Paris; 011-01-42-84-90-00; info@alliancefr.org, www.alliancefr.org.


Basic residency rules for France
ALTHOUGH Johnny Halliday may have fled to Switzerland to dodge the French tax authorities, it is not an option open to many.

So issues concerning tax are likely to be high up on many people’s agendas when they are thinking about a move to France.

And the biggest factor that will decide how the tax office will treat you will be where you are considered resident.

An individual, whether a French or foreign national, is resident according to the French tax code if:

- You have a permanent home or principal place of sejour in France.
- You spend more than 183 days in France during a calendar year or spend more time in France that any other country.
- You carry out an occupation or are employed in France, except where this is incidental to a foreign activity.
- Your centre of economic interest is in France.

So if you fall into one of these brackets you are considered French resident and will pay taxes on your worldwide income.

But if you are outside, then you are considered non-resident and would pay taxes only on your French source income.

The tax authorities will decide your status at first and you are allowed to appeal if you do not agree with their decision.

But it can be seen that the rules have nothing to do with visas, passports, property ownership – you could be renting and be considered French resident for tax purposes.

If you have decided to move to France permanently then you should contact the tax authorities in your current country.

They may ask you to provide evidence that you are no longer resident, for example, in the UK the Inland Revenue ask if you have taken steps to acquire accommodation abroad.

It is possible that you may receive a tax refund but also you affairs will be tied off, ready to be set-up abroad.

However, it could occur that you fall between two stools and this is where the double taxation treaty between the UK and France comes in.

France also has taxation treaties with all other EU states as well as the USA, Australia, Canada and around 70 other countries.

But what the agreements ensure is that income that has already been taxed in one country is not liable to tax in another.

For example, pensions received from the UK, except for government pensions, will be taxed in France and not in the UK.

Residency and double taxation treaties are complex affairs and professional advice should be sought – but it is an important consideration.

A useful starting point is the Inland Revenue website:
Residents and non-residents - Liability to tax in the United Kingdom or Tax when living abroad.

By Craig McGinty on January 31, 2007, admin. In Property | Site RSS feed | Free newsletter
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Comments
Thanks so much for this post, I've been wondering about this since I moved here about a yr ago! The tax issue had to be resolved eventually & I'm glad to have found out certain things from your post.

Posted by: shannon | 7 Feb 2007 21:44:20

Hi Shannon, glad the article has helped out - at least getting your tax straight is one less worry.
All the best, Craig

Posted by: Craig McGinty | 8 Feb 2007 21:31:34

Canadian Resident dies and he has his RRIF benificiary his sister in UK. What are the taxes of the RRIF and who has to pay for it. Is it the estate or the benificiary. What are the witholding taxes in Canada. In the treaty it says that we can keep up to 43% witholding taxes in Canada and send the rest to UK. Nobody seems to know the right answer. We have been in touch with Ernest & Yound the biggest accounting firm in Vancouver and they don't have a clue about it. We have 3 lawyers working on this case and we don't have any definite answer. We are sure that this has happened before and how the accountants and the lawyers have delt with it. Please help, we are frustrated and don't know whom else to speak to. The Revenue Canada tells us that we have to hold the taxes in Canada but the accountants and the lawyers are doubtful about it.

Posted by: Heidi Baloun | 9 Mar 2007 21:20:27

I wonder if anyone can help me find out some information on becoming a french resident.
I am 2 years off retirement age, own a building project in france and work as a carer in England. I work for an agency so I pay my own tax, in other words I'm self employed. I would like to become a french resident this year and comute from time to time to carry on the work I'm doing in England.
Questions I'm looking for answeres to are:-
If I declare my earnings in france for tax purposes, would I have to pay social charges.-Equivelent to Nat. Ins. contributions? and is this alot mor than I pay in England?
Also would I be entitled to an E106?
Sophia

Posted by: Sophia Lee | 16 Jan 2008 15:48:52

Hi Sophia
If you are considered French resident then you would be included in their taxation system, so would be asked to pay social charges.

Contributions are higher than the UK, although the overall tax take is not that different, and I'm sure people would say that the services you receive are much better.

As for the E106 that only applies to people not working who would be entitled to Incapacity Benefit, and is for a limited period, more here:

http://www.dwp.gov.uk/international/sa29/medical_06.asp

So if you were paying into the system as self-employed then you would receive health cover as normal, and upon retirement receive cover as if you were in the UK.

I'd take a look over the Department of Work and Pensions website and give them a call.

Hope this helps
Craig

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