2015 income tax returns- for income earned in the year 2014

French Income and Wealth Tax returns

Tax year 1st January – 31st December 2014

Income Tax (Impôt sur le Revenu)

Both residents of France and non-residents with French property or income are obliged to submit an annual income tax return.

The French tax year is equal to the calendar year. The presentation deadlines are as follows:

Non-residents

Manual returns: 19th May.

Returns filed by internet: 9th June.

Residents

For manual returns, the deadline is 19th May. An extension is given for returns filed by internet, as follows:

26th May: Départements 01 to 19;

2nd June: Départements 20 to 49; 9th June: Départements 50 to 974.

Dates that returns are available for filing

Online filing: 15th April

Manual filing: The date varies each year but in general this is by early May.

After you file your Tax Return, the Tax Office will calculate the tax due and send you a payment notice, avis d’imposition. The date of issue is by late September. In the event that tax is payable the payment notice will include a payment slip for you send to the Tax Office along with a cheque. Online payment options and direct debit are also available.

Please visit our website for further details or contact us by e-mai at info@franceaccountants.com .

 

Frontalier tax returns

If you live in France but work across the border in Switzerland  then you are, as you are probably aware, know as a travailleur frontalierand a special set of tax rules apply.

Depending on in which canton you work, Swiss income tax may or may not be withheld from your salary and this will affect how you need to declare your income in France.

1. Salaries not subject to income tax in Switzerland

If you work in one of the following cantons, then no Swiss income tax should be withheld from your salary and you should declare your salary for normal taxation in France.  If Swiss Social Security is deducted, then it is the net amount received (net imposable) that is taxable in France.

VAUD, VALAIS, BÂLE-VILLE, BÂLE-CAMPAGNE, BERNE, JURA, NEUCHATEL, SOLEURE

You will need to complete Declarations 2047 (Suisse), 2047 and 2042.

2. Salaries subject to income tax in Switzerland

If you are employed in any other Canton, for instance Geneva, then your employer has the right to withhold Swiss income tax from your salary.

In this case, you have the right to claim a credit in your French tax return. This credit is equal to the French tax payable on the income. What this means is that there will be no further tax payable in France.

If Swiss Social Security is deducted, then it is the net amount received (net imposable) that is taxable in France.

The forms to complete are 2047 (Suisse), 2047 and 2042.

 

For further information and assistance, please visit our website at www.franceaccountants.com .

 

 

 

 

 

 

 

 

 

 

 

 

Non-residents with French rental income- which tax returns to file ?

 

For further help and advice, please visit our website www.franceaccountants.com .

The time for filing the 2014 annual French tax returns (i.e. for the year 2013) is approaching !

Here’s a guide which should help you decide which tax regime you should use to declare your rental income and which forms need to be completed.

Firstly, the French tax system distinguishes between furnished and unfurnished property.

In general, the system allows for higher deductibility of expenditure on furnished property; this follows the line of thinking that property rented out unfurnished is normally a long-term rental where most costs are covered by the tenant.

Let’s look at furnished property first.  Around 75% of our non-resident clients come under this category, with property in France that they let out for holiday rentals as well as for their own personal use.   If your property produces rental income of less than 32,900 Euros in a year, then you can opt to declare under a special tax regime called Micro-BIC. Under this regime, you need only declare the gross rental income in Declaration 2042C, and the Tax Office gives you a 50% allowance for expenditure.

So, for instance, if the rental income from your French property in 2013, before any expenditure, was 20,000 Euros, then:

Your taxable income is 10,000 Euros. This is subject to income tax at 20% and Contributions Sociales at 15.5%. The total tax payable is therefore 3,550 Euros.

Of course, the Micro-BIC regime is optional and if your actual expenditure is higher than 50% of your rental income, then you will save tax by declaring your actual expenditure under the regular tax regime, for which you should complete Declaration 2044. Please see the section below on unfurnished property income for further details.

Note that if your property is run as full-time accommodation such as a gîte rural, meublé de tourisme or chambres d’hôtes then the tax treatment under the Micro-BIC regime is even more favourable, with a deduction of 71% for expenditure and a maximum allowable income of 82,200 Euros per year.  Note that in order to be eligible for this, it is necessary to register your rental business formally at the nearest Chamber of Commerce and pay the corresponding local taxes due.

Now onto unfurnished property.  If you rent out your property unfurnished and you have annual rental income of less than 15,000 Euros, then you can opt to declare your gross income under the Micro-foncier tax regime, in Declaration 2042. This gives you a 30% allowance for expenditure.

So, for instance, if the rental income from your French property in 2013, before any expenditure, was 20,000 Euros, then:

Your taxable income is 14,000 Euros. This is subject to income tax at 20% and Contributions Sociales at 15.5%. The total tax payable is therefore 4,970 Euros Euros.

This regime is optional and if your actual allowable expenditure is greater than 30% of your income, then you will save tax by declaring under the normal tax regime. As with furnished lettings, the additional form to complete is Declaration 2044 and the following expenditure is allowable:

  • Management and agency costs;
  • Accountancy charges;
  • A fixed allowance of 20 Euros per property;
  • Maintenance, repairs and improvement costs;
  • Property tax paid;
  • Insurance costs;
  • Mortgage interest paid. Mortgages with foreign banks are also eligible.

Note that certain tax regimes cannot be changed within a fixed period, so it is important to plan ahead.  For further help and advice, please visit our website www.franceaccountants.com .

 

French tax return filing deadlines for 2014

 

Here are the deadlines for filing the annual French tax returns.

Non-residents

Residents of EU/Mediterranean countries, Africa and North America: 16th June;

Residents of other countries:    30th June.

Residents

For paper returns, the deadline is 20th May.  An extension is given for returns filed by internet,  as follows:

Departements 01 to 19:     27th May;

Departements 20 to 49:     3rd June;

Departements 50 to 974:   10th June.

 

The tax calendar published by the Tax Office is not very useful as it does not state the filing deadlines. Here is a link to a third party website that has a comprehensive calendar. www.calcul-impots.com/calendrier-fiscal-2014,5.html

For further information and assistance with your French tax returns, please visit our website www.franceaccountants.com .