Sunday, 31 July 2011

Many tax changes

2011 is proving to be a good year for those people living in France as far as taxes are concerned, with significant changes already made or planned.
The latest changes are concerning UK expatriates who have been affected by the UK's 90 day residence rule. With effect from 6th April 2012, most expats will now be able to spend up to 119 days in the UK, and still remaon a non resident in most cases.
French Wealth Tax has also seen significant changes, with the threshold increased from 800,000 Euros to 1.3 million € (effective 2011), and coming soon, just 2 bands of tax 0.25% between 1.3 and 3 m €, and 0.5% for above 3 m €, (effective 2012).
Succession & Gift Taxes have also changed.
Coming to France offers many financial planning opportunities, especially via QROPS & QNUPS arrangements. The benefits include examption from all UK taxes on death if you have been non UK resident for 5 consecutive years, (a potential saving of 55%). These plans also avoid French succession law and offer other additional benefits.
As usual, new tax laws bring with them new opportunities to plan your finances, (different and better). We are able to offer the best quality Independent Financial Advice via our dedicated contacts, (for whom we are registered introducers).
Peter Elias (Agent Commercial)

Sunday, 17 July 2011

Exclusive mandats

One of my pet hates is French agencies using “sole agency” on their properties without explaining the potential outcome to their clients, (the vendors). In the Poitou Charentes, there is one well-known agency who is particularly active in this respect. There is also one Notaire who is also into the exclusive agency business. What does it offer for the vendor – well, not a lot apart from a number of promises by the agent, which they will struggle to keep. Normally this is based on increased advertising and internet presence. In practice, it means that the agency can sit back a bit in the knowledge that they have blocked the sale of the property by any other agencies for a period of at least ¼ of the year, sometimes even longer. The agent that I have in mind, currently has 34 properties advertised as sole agent, even though I have seen a registered mandat with another agency, created before their exclusive mandat, that is still valid. So that could prove interesting ! This agency takes out a small 2 property advert in the French Property press, so over the period of a quarter only 6 out of those 34 properties will benefit from this “high profile” marketing. In the Dordogne valley, if we enter into an exclusive agreement, it is very much on a “gentleman’s agreement”, and the vendor only signs a non-exclusive mandat, there being trust between both parties that the deal will be honoured. In return we are able to arrange floor-plans and elevated photography to make the property really stand out in the market place. We think this added-value is much better than an empty promise.
Rarely to vendors know how to get out of these exclusive mandates, which normally requires a registered letter (AR), towards the end of the 3 month exclusive period as a minimum, to renounce the contract. Mandates for the purchase of French property are often signed in haste by keen sellers and buyers and repented on at leisure. They are a fruitful source of work for litigation lawyers in France and regularly keep the French Appeal Courts and Supreme Court occupied. UK buyers and sellers are at a big disadvantage as the system in England is not the same and they do not understand what they are signing. So, you have been warned.

Sunday, 10 July 2011


OK, the market is pretty static, both in the UK and here in France, but recently I have encountered clients (buyers), who have been advised by an agent not too far from where we operate, that buyers should negotiate hard, typically 20% below the asking price. It may well be that in certain circumstances, when someone is desperate to go back to the UK for example, that the vendor may listen to such an optimistic offer. After all, the vendor may have purchased their property when the £ / Euro value was around 1.50 against the present 1.12. The currency movement covers a 25% gain during this period, giving some vendors a lot of flexibility. You have to question the professionalism of an agent advising clients in this way. They are opening the door for wild offers on any properties that they have for sale, something their owners will not thank them for. Unless of course, that as part of their strategy they over optimistically inflated the asking price by 20% in the first place. My advice, would be to steer clear of such agents. By all means listen to what your agent has to say, and they will often know when a vendor is negotiable or desperate to sell, but the latter situation is the extreme rather than the rule. For our part, we have successfully negotiated properties priced between 350,000 and 500,000 recently and the offers have all been around 5% below the full asking price. So the buyers have gone away happy, as have the vendors. Peter Elias (Agent Commercial)

Sunday, 3 July 2011

Good news on 3 fronts

The French Government has announced that access to the French Health service will now be available for "early" retirees – a reversal of the previous legislation that caused many people caught up in this trap a lot of problems. Thus the gap between the expiry of reciprocal health cover provided by the S1, (issued for up to 2 years based on N.I. contributions) and the S1 issued on reaching UK retirement age has been completed. This reverses the decision made back in 2007. It means that, providing contributions are made to the French Health Service ex-pats will be entitled to exactly the same cover as French Nationals. The French Government previously had announced the abandonment of the proposed new tax on foreign owned holiday homes – “maisons secondaires”. This U-turn came about when they realised that it impacted significantly upon the many French citizens working overseas and how they would be affected by such a tax. With an election scheduled for 2013 the Government cannot afford to risk upsetting these potential voters. Special Offer – 300 Euros refund ! To qualify for this refund, you need to spend a day viewing with us (normally 4 or 5 properties), and then purchase via ourselves. Full details on request via our website