Sunday, 27 February 2011

Sunday, 27 February 2011

France - a low rate tax regime

Some people assume that France is a country of high taxation. It can be, be it can also be one of low taxation if you are smart.

Looking at Capital Gains Tax for example on property - if the property has been owned by you for fifteen years then no capital gains tax is payable on sale, even though it is not, and may never have been, your principal home. This is a massive advantage in comparison to UK rules.

Even if you have only owned a property for between 6 and 15 years an allowance of 10% per year of the gain is granted. Thus, as an example, if you sell a property after having owned it for a full 10 years, you will be granted an allowance of 50% against your liability to capital gains tax. Unfortunately, no exemption is available for a sale in under 6 years. In addition, no capital gains tax is payable on a property owned by a non-resident of France, provided you can demonstrate / prove that you have previously been fiscally resident in France for a continuous period of at least 2 tax years.

Ex-Pats often consider that the French get preferential treatment in some areas, but non-residents are not subject to the 12.3% social charges element of capital gains tax, that French residents have to pay under any circumstances. So there is some good news – and France can be a low rate tax regime ! Peter Elias (Agent Commercial) www.allez-francais.com
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