Now is always a good time for checking your finances if you’re an expat in France. An annual tax check can really pay off.

There always seems to be something going on that can influence exchange rates, savings and financial plans. Covid, war, political instability, energy supply problems, global supply chain issues… There’s been a lot to contend with in recent years. As the economy evolves, so should your financial planning. Robert Kent of Kentingtons, tax and financial advisors, says that now more than ever expats need to think about what all these issues mean for them and, more importantly, what they can practically do about it….

If you spend in Euros, think in Euros

At Kentingtons we meet many people who think very much in the currency of their old home, such as Sterling. But, thinking in a currency that you do not live in can create risk. Brexit has shown us just how much Sterling can move versus the Euro. As a French resident, thinking in Euros does not merely reduce the currency exchange risk, it eliminates it. If you can eliminate unnecessary risk, why not do so?

“But my pensions / rental income (etc) are in Sterling!” you say. This does not prevent sensible planning, using FX companies to maximise currency moves, maintaining your savings and investments in Euros (which makes sense from a French tax perspective, by the way) and forward planning your income requirements.

If you have rental property outside of France / the Eurozone, challenge why this needs to be so. If it is purely an investment, you might be better off to consider selling and creating more Euro income.

Do you have pensions that could be cashed in? For many pensions this can be done, in France, with an effective tax rate of just 6.75%, so worth considering. Could any of your income be turned to Euro revenue?

My point is merely to prompt a rethink. What was the right course of action, when things were first done, may not be right for the way life is now.

Hope For the Best, Plan For the Worst

When it comes to income planning, it makes sense to hope for the best and plan for the worst. Good financial planning is not gambling, it is about creating as much certainty as possible. If you are living in Euros, then ensure you have sufficient Euros to see you through a crisis. A crisis could be in exchange rates, the financial markets, a slowdown in the rental markets, property prices etc. The point is to calculate how much income you might need for the next few years, ensuring that it is easily accessible and usable. A crisis, no matter what the source, should not cause you sleepless nights.

Consider Inflation

Don’t just consider what you need at today’s prices but build in inflation. In France we have seen it go to over 6% from almost nothing. The point is you just cannot guarantee what will happen. So, plan for higher inflation, which means planning on needing a rising income for the next few years, in the hope that you do not need it.

Rethink your investment Strategy

Interest rates at 0% mean that money is eroding in real terms, so a sensible investment strategy is key. Simply keeping it in the bank or under the mattress is unlikely to help. A traditional market investment strategy of 60% of your capital in the markets and 40% in bonds, is out of date. Bonds means that you may be paying them to keep your money (hopefully safely). It does not mean that they do not play a role, however, they have become less central. If you have buy-to-let properties, what happens when they are vacant and / or you need to sell when the market is bad? Property is not always ‘as safe as houses’!

With sensible financial planning, you stand a much better chance of withstand issues when they arise. And an annual tax check can save expats in France money and mean less stress.

Contact the team at Kentingtons for advice, or a free initial consultation at: kentingtons.com

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There’s a question that comes up time and again when it comes to insurance in France: car insurance for foreign registered vehicles. Fabien Pelissier of FAB French Insurance whose team specialise in helping English speakers in France with all their insurance requirements, explains the process of insuring a non-France registered car…

Car Insurance for foreign registered vehicles

Most people believe that you can’t have a foreign registered car insured in France, but this isn’t true. If you’re planning to move to France and register your foreign car – which is a legal requirement – then this can take time. And while you’re waiting – you will need insurance. So if you’re asking ‘can I register a a UK registered car in France’ – the answer is yes. But there are caveats.

We can insure foreign registered vehicles in the same way as we can for a French registered vehicles with a “standard” policy. This is based upon the assumption that you will register the car or bike in France. Failure to do so may open you up to consequences which can have long term effects in France where there is a central insurer’s database. Do not consider insuring the vehicle in France if the import project isn’t solid or might be reverted.

French car insurance – how no claims bonus works

Foreign insurance history, for instance ‘no claims bonus/’no claims discount’, can be converted into the French equivalent. This is called the CRM or the bonus. The conversion may look weird at first as France doesn’t work like the rest of the world (which may not surprise you).

The maximum discount in France is 13 years (50% bonus or CRM = 0.50). The “CRM” is like your own index. It starts at 1 and each year without a claim it’s multiplied by 0.95. A maximum discount reached when your CRM is at 0.50 (e.g. 13 years without a claim). Every claim deemed to be your fault will multiply your CRM by 1.2. It takes roughly 5 years to write off a claim in France.

Unlike other countries (for instance the UK), it’s not possible to “protect” your discount here. This is why French insurers will need to see your full history (proof of no claim) and not just the “insurer’s discount” or ‘no claims bonus’. They know a 9 years no claims bonus doesn’t mean you’ve been claim free for the past 9 years. That said they also don’t care about anything that happened more than 3 years ago. French insurers only look at the past 3 years of insurance. The upside of this is that you may have a 9 years NCD with claims 5 years ago which won’t be considered when you convert your NCD into a French CRM. French insurers require proof of no claims from the previous three years which can be onerous when you’ve changed insurers each year.

There is no off road status (SORN) in France

Another major difference is that French insurers really hate insurance gaps. The “off road” status doesn’t exist in France. You must be insured even if the vehicle is no longer in driving condition. A gap in your insurance record of more than 3 months is bad for your future premiums – and a gap of more than 6 months is most certainly going to be problematic.

One big difference with French car insurance is that it’s the vehicle that’s insured – not the driver.  You can allow anyone to drive your vehicle in France if you pay for increased excess which is not expensive.

Find out more and get a quote at: FAB French insurance

The post Find out about car insurance in France appeared first on The Good Life France.

The currency market moves about from day to day, sometimes up, sometimes down. But when you’re looking at paying the deposit on your dream house in France or needing to send funds to pay bills or for things like building work – the last thing you need is more stress and uncertainty not knowing which way the currency wind blows. And that’s where a foreign exchange money transfer company can really help you to save money on your currency transfers to France.

What are foreign currency money transfers all about?

Most of us don’t know the ins and outs of foreign exchange, we don’t need to. But we do know that our bank usually charges commission. And we do know that they’re not usually giving us the best rate available. Many of us don’t look for a different way to get a better rate because it might seem too much bother. But actually, nothing could be further from the truth. The whole system of foreign exchange has moved on leaps and bounds in recent years and makes it easy for clients to take advantage of the best market rates experts can provide.

Currencies Direct for instance, make setting up an account easy and quick – it’s all online. They have staff at the end of the line you can talk to – not just a chat bot. They have more than 20 branches around the world, trade in more than 40 countries and have experts watching and analysing the market constantly and providing live exchange rates.

They’re happy to give advice. They have no hidden fees, zero transaction costs and secure the best exchange rate on your behalf. Currencies Direct were the first money transfer provider in Europe and have been helping to move money at the best rates for almost 30 years. They are fully authorised and have level 1 credit rating with Dun & Bradstreet which may not mean much to most of us but essentially it’s the highest credit rating available.

Importantly for their clients, they can make payments that arrive in minutes – not days later. As anyone who’s ever needed to transfer money abroad knows, waiting for a payment to come through can be the sort of stress you just don’t need. Especially when you’re sitting in the notaire’s office waiting to be handed the keys to your dream home. Or you need to pay a bill. Or have euros in the bank when you need them.

Currency exchange tips for French home buyers

When it comes to buying a property overseas there’s plenty of paperwork to complete and lots to consider. But one thing that you can save time, stress and money on is the transfer of funds. Not just for the deposit, but any mortgage payments and ongoing costs such as electricity and phone bills.

Transferring funds via Currencies Direct can save you a fair bit of money. They’re at the end of the phone to help with any questions and to give advice.

How does setting up a foreign exchange account work

First register for free – simply complete a quick and easy online form. Let Currencies Direct know what currency you need and where you want to send it and they’ll come straight back with a live rate. You confirm, they will book the payment and you send the funds, they accept debit cards or bank transfers, to their segregated account and they will make the payment as soon as they receive your funds. Simple. Secure. Stress free.

You can also instruct them that you want to be notified when the market rate reaches a level that suits you, and then make your transfer. Make a one off payment or set up regular payments such as a mortgage. If your bank charges say £25 per transfer and you’re paying a mortgage 12 months a year, that’s £300 you could spend on something much more fun. And you’re probably not getting the best rate either. It doesn’t matter if you’re sending a large sum or small money transfer – why waste it when you can save money.

Currencies Direct help you manage your transfers and payments online with ease and securely.

The Good Life France uses Currencies Direct. Registration is easy and secure, plus there are no added fees. They save their customers money  with their advantageous rates of exchange and guidance. You can speak to one of their experts over email or by phone… Find out more about their currency transfer services here: currenciesdirect.com

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As in all aspects of life in France, the differences from the UK are numerous – and that includes marriage.

In Britain, depending on one’s faith, or lack of, one would typically get married in a church, or in a registry office. In France most couples do both! Before being married in a church, the marriage much be officially conducted in the local town hall – the mairie.

And it gets even more confusing. Because, in France there are various marriage regimes, which are effectively marriage contracts in the legal sense. It’s important to choose wisely, as the chosen regime will govern how a couple’s assets are owned. This will also affect how assets are dispersed, including inheritance, explains Robert Kent of Kentingtons, tax consultants for British expats in, or moving to, France.

A choice of marriage regimes in France

In the broadest sense, the three principal marriage regimes in France can be explained as follows:

Séparation des Biens
This is literally translated as “separation of assets”, which is fairly self-explanatory.

Communauté Réduite aux Acquêts
This is the default marriage regime in France. In short it means that everything purchased by the spouses after the marriage is owned by the community, i.e., jointly by the two spouses, even if only one of the two pays.

Communauté Universelle
Everything owned before and bought during the marriage is owned within the community, i.e., jointly by the two spouses.

Marriage problems – when it comes to inheritance in France

Most British couples, in their minds at least, would consider themselves married within a universal community, i.e., all is shared, and very often all is inherited by the surviving spouse. But here’s the issue. In France, the vast majority of couples married in the UK are considered to be married under the Séparation des Biens marriage contract. Why is that a problem? Of course, every case is different, but let us consider one relatively common example.

Mr and Mrs Smith, who have two grown up children, were married in the UK and lived there for many years before moving to France. Each wants their surviving spouse to receive all assets on first death. However, being married under the separation of assets regime means that French inheritance law takes charge.

Inheritance law reveals another notable difference. In the UK you can generally leave all your worldly goods to whoever you like, even the neighbour’s dog, if you wish! In France, however, the children have an absolute right to inherit a minimum percentage of the deceased’s estate as follows:

1 child – half
2 children –  two thirds
3 children or more – three quarters

If we go back to our example, on the passing of Mr Smith, the two children would have a right to two thirds of Mr Smith’s estate.

What can you do to ensure your assets are shared as you wish?

In the UK, you simply write a will, allocating funds to whoever you wish. In France, inheritance planning can be more complicated. However, in certain circumstances it is possible to change one’s marriage regime (contract). And, as in the UK, there are ways in France to plan for the future in a tax efficient way, offering as much protection as possible to all your loved ones, be they from a first or second marriage.

Everybody’s situation is different. Advice given to your neighbour, for example, may be totally inappropriate for you. When you’re looking at long term financial planning, it’s essential to take qualified advice that’s personal to you own specific family set-up.

By Robert Kent of Kentingtons, Tax and Investment Consultants with coverage throughout France and the UK. Find out more or get in touch for advice and support at: kentingtons.com

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For many expats in France, administration and bureaucratic practices – for which the French are rightly renowned – can cause a frustration and confusion, including insurance. Luckily, help is at hand with an expert English speaking company who cover all aspects of insurance.

FAB French Insurance

FAB French insurance are an English speaking, French native speaking, brokerage, based in France. They are experts at anything and everything to do with insurance. Their aim is to make the whole process of insurance easy for their clients and to make sure they’ve got you covered.
Working with more than 30 insurers means that they are able to find an affordable solution for clients, and a solution that’s suitable for every situation. Fabien Pelissier of FAB French insurance says, “we take care of the tricky bits of the French system, and make sure that you get the insurance you need.” And as you’d expect, this being France, there are always a few tricky bits! FAB French Insurance have an online quote system that’s simple to use, jargon free and in plain English and you’ll get a quote back following their competitive analysis, with a clear explanation of the process.

Visa and residence Insurance for France

If you’re a non-EU citizen and want to stay in France for longer than 90 days in a 180 day period you’ll need a visa – a Visa Long Séjour (VLS-TS). Even If you want to live in France, you’ll need to apply for the one year VLS-TS. When you apply for your VLS-TS, you’ll need to include several documents such as bank statements, and most importantly, private medical insurance (PHI). One of the most common reasons for a refusal on a visa application is the insurance element. FAB French Insurance can help you get your insurance sorted and provide you with those all important documents that you need to include with your application. Get a quote for your visa and residence insurance for France

Car insurance

If you’re planning to move to France and register your foreign car – which is a legal requirement – then this can take time. And while you’re waiting – you will need insurance.  Despite what some people say, this can be done. FAB French Insurance can insure your foreign registered car in France as well as your French registered car.  And in France, it’s the car that’s insured – not the driver, so you can add on other drivers to your policy for an excess fee.

Household Insurance

French household insurance may differ from what you’re used to. You might be asked to provide photos of buildings, repair bills and more. And getting the right insurer that you can trust is really important.  We’ve heard tales of insurance companies holding out for years before paying up after a claim, often because non-French clients either didn’t understand the small print or didn’t get the right policy because they didn’t understand the differences. FAB French Insurance explain everything in English. They know that their British clients aren’t used to French insurance and they make sure that you’re made aware.

Additional Health Insurance

In France, the excellent healthcare system is available to all residents, but there is also a top up insurance system in place. 95% of adults in France have this insurance, known as a “mutuelle.” A mutuelle provides additional health cover and is different from PHI in that it doesn’t charge premiums for pre-existing conditions. Although French health care covers around 70% of the charges, there may be fees to pay that are not covered by the state. A mutuelle is an insurance policy that covers these costs.

For more information: fabfrenchinsurance.com

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If you’re moving money to or from France you’ll want to get the best return possible on your currency transfers. But how do you make sure you get the best rate? We asked Calum Harkiss at Currencies Direct who have been helping people maximise their currency transfers for almost 30 years, to explain the process why timing is important when transferring money overseas…

The currency market is always moving, so picking the right time to make a transfer can be tricky. Even a seemingly small discrepancy in the exchange rate you secure can make a massive difference to how much you receive, and rates can shift by as much as 5% in a matter of weeks.

Over the last ten years we have seen several historic shifts in the currency market due to events like the EU referendum, Covid-19, Brexit, the war in Ukraine and (most recently) the turbulent political situation in the UK.

In 2022 alone the GBP/EUR exchange rate has seen a wide range of fluctuation. Over a short period of time, if you had £100,000 euros to transfer you would have received €121,000 at the higher rate, but €6,000 less when exchange rates were at their lowest. When you transfer money through Currencies Direct, we’ll provide, and agree, an exchange rate with you over the phone, online or via our app. We can help you buy currency to use at a later date, we set rate alerts and we send your currency as soon as we receive your payment. It’s simple.

No transfer fees for your currency transfers

And it’s not just the timing of your transfer that’s important, the exchange rate you receive can be very different depending on the provider you use to move your money abroad.

While most banks will offer you uncompetitive exchange rates and tag on transfer fees, as a leading currency provider, Currencies Direct will make sure you receive exceptional exchange rates, potentially saving you thousands on larger transfers.

What’s more, we don’t charge transfer fees and we offer a range of specialist services to help make your money go further.

Whether you want to fix an exchange rate ahead of making a transfer, buy currency in advance or target an exchange rate higher than the current market level, Currencies Direct can help. currenciesdirect.com

Find out more and get advice at: currenciesdirect.com or contact Calum Harkiss:  +33 (0) 631 559 607 or email calum.h @ currenciesdirect.com.

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The question of French tax residency rules affect anyone who has a home in France. We ask Robert Kent of Kentingtons, the professional tax advisors for British expats in France, to explain what the rules are…

Am I a tax resident in France?

I will start by saying french residency rules are a matter of legislation, not a matter of choice. I am often asked “where is it best to pay taxes … France or the UK?” It must be clear that there is no choice. It just depends where you fall within the rules.

Many people bury their head in the sand when it comes to defining their residence of France. It’s so easy just to stick with what you know and avoid what is foreign. Many people, who do attempt to define their status, try to define their residency of France using the same rules as are used to define residency of the United Kingdom, eg UK law. But this makes no sense at all when trying to define the residency rules of another country.

French Tax Residency Rules

The bad news is that the main laws defining residency of France do not even mention the number of days spent in the country. So, it’s time to throw out the UK rule book! We’re in France! Many people think that the rules on residency are vague. And yes, this can sometimes  be the case. However, very few people fall into this vague category. For most people, their residency position is very clear.

The french tax residency rules are clarified both in Article 4B of the French tax code (the Code Général des impôts or CGI) and Article 3 of the UK/France Double Tax Treaty. Residency is defined using a series of tests:

Where is your principal residence? (Article 4B1a – CGI)

This is also supported by article 3a of the UK / France double tax treaty. If you have one “home” this is easy. If the only “residence” available to you is in France you are French resident. For any property to be viewed as your “residence” it must be available for your use. If rented out it doesn’t count. And  it must either belong to you or be a property you rent with a “formal” rental agreement. Using a relative’s or friend’s address is not sufficient. As a guide, you’re generally required to provide utility bills for the property – in your name.

Just to prove that number of days can literally be inconsequential, there was a case of a businessman who had never been to France. However, his wife lived there, and his children lived and went to school there. Even though he had not entered the country, it was viewed that his principal residence was France as this is where his family was based. The conclusion is that ‘principal residence’ test overrides the number of days test.

If you do own a “residence” in each country, then it is settled by your centre of economic or “vital” interests.

Where do you have a professional activity? (Article 4B1b -CGI)

If you work in France or have a business here, this can make you a French resident. If it is ancillary to your main profession and this is in the UK, for example, it is not necessarily the case. However, if it is your only activity, you will generally be deemed as resident.

Where is your centre of economic or “vital” interest? (Article 4B1c -CGI)

This is supported by article 3b of the UK/France double tax treaty. Ultimately this is where you run your financial life from. For example it may be where your income is paid from. Or it may be where your business interests are and also where you manage your assets from.

Place of your habitual abode

This is where French law and the tax treaty stop overlapping. The tax treaty takes over to decide in which country you are resident. Article 3b states that if your centre of vital interest cannot be determined or there is no principal residence, or “home”,  then it is down to where you have your habitual abode. This does not count the number of days in a country, but merely where you are spending most of your time. If you only spend your time between the UK and France and nowhere else, then it can be simplified as where you spend over 183 days. However, it is this oversimplification that has led to many problems. For instance, if you spend time in a third country, it is possible to be in France for, say, five months and still be considered resident. It’s about where you are spending most of your time.

It is important to note that it is not after 183 days that you become resident. It is from your day of arrival in France. So from the day of arrival – you are assessable to tax in France.

Country of which you are a national

Article 3c states that if residency position still remains unclear, your residency will be decided by the country of which you are a national.

Mutual agreement

Article 3d states that if you are a national of both France and the UK, and none of the other tests make your residency status clear, it then goes to deadlock. Then it’s up to the respective fiscal authorities to decide between them.

Joining the health system

This has nothing to do with tax law, but more to do with making a false declaration. If you are not a resident of France, you have no right to join the French healthcare system. By joining you are openly declaring that you are a resident of France. Many people have found themselves in hot water with the financial authorities because they have joined the French health service. If you do not live in France, do not join the health service.

Conclusions About the French Tax Residency Rules

To be in a “vague residency position”, you would need to have a property in the UK and France. Have the utility bills are in your name. Equal vital interests in each. Spend exactly the same amount of time in each country. And be a national of both countries. If you are working you would need to be exercising your profession equally between the two countries. This is why very few people fall into the “vague” category. Establishing your position maybe somewhat complex, but it is normally perfectly clear.

If you are a resident of France, you are also domiciled in France, since the double tax treaty between the two countries agrees this. More importantly, you are now duty bound to complete a French tax return, declaring your worldwide income. It does not matter where it is paid, where is maintained, whether it is considered “exempt” in France or not, whether you pay tax at source in the UK or not. You must declare everything. Even if you have no income at all, you must still complete a return.

It is unlikely you will be sent a tax return in the first instance. The law says it is your responsibility to obtain one. You can obtain a tax return at your local mairie, tax office or online at www.impots.gouv.fr.

Is paying tax in France bad news?

Not for most people. In many cases the weight of taxation is lower in France than the UK. Obviously, this depends on your situation and the only way to be sure of your position is to seek advice from a qualified professional.

Contact the team at Kentingtons for advice, or a free initial consultation at: kentingtons.com

The post The rules on tax residency for France appeared first on The Good Life France.

For British expats in France, professional and unbiased tax advice can make a real difference to your finances – and your quality of life. Like anywhere else, getting tax paid on time, and getting all the details right is essential in France. And that’s where you may want help and professional advice – the devil is in the detail. And the detail isn’t always easy to discover for British expats who aren’t used to French administration, and how time consuming it can be to deal with.

Luckily, help is on hand. Kentingtons are a qualified tax and investment advice company who have decades of experience helping British expats in France with all aspects of tax. Property wealth tax, income tax, inheritance tax, capital gains tax and succession law – Kentingtons can help you with French tax in all forms. They’re regulated in France by the Autorité des Marchés Financiers (AMF), the French financial regulator. This is the only financial regulation of importance for anyone moving to or living in France.

And if you’re considering moving to France, Kentingtons can help you sort out your finances so that you arrive with everything in good order for a worry-free start to your new life. When you move to France with the intention to live there, you become a tax resident the day after you arrive. This makes you liable to pay tax on worldwide income, gains and real estate wealth, various tax treaties in place also need to be accounted for.

And if you intend to remain in France for a significant amount of time, it is vital that to check your tax status, to be sure that you do not fall foul of the rules.

Plain English – and peace of mind

It’s true when people say that French administration is bureaucratic on another level! And when it comes to tax, the system can be complicated, time consuming and downright frustrating. That’s where professional support can make a real difference. You may need help with your tax in France. You might not want to spend hours dealing with it. Or perhaps, you just want the peace of mind that comes from working with an expert. Kentingtons can support you with every aspect of your tax requirements in France. They provide jargon-free plain English reports so you always know exactly where you are with it all. And you’ll deal with the same person each time. Someone who knows your situation and ensures that you get the best advice possible.

Kentingtons offer national coverage throughout France and the UK. Their expertise can help you make the most of your finances. They will make sure your tax requirements are dealt with in a timely manner and with no mistakes. Peace of mind, tax sorted.

Contact Kentingtons to find out more about their services and book an initial, free consultation: Kentingtons.com

The post English language professional tax advisers in France appeared first on The Good Life France.

Paul Flintham, an International Financial Advisor at Beacon Global Wealth Management explains how French Gift Tax works…

In simple terms, with French gift tax the donor makes the gift. The donee receives the gift and is responsible for paying any tax that is due (droits de donation).

Residency

If the donor is tax resident in France, tax is payable on all worldwide assets transferred in excess of the allowances available.

If the donor is non-resident, but the donee has been a tax resident of France for at least six out of the last ten years, liability arises on all worldwide assets transferred to the donee in excess of the allowances available.

If both donor and donee are non-resident, tax is payable on the gift of real estate only in France.

Relationships

The gift free allowances are only for family members and are variable according to the relationship to the donor. The donor must also be under 80 years old, and the donee over 18 for the allowances to apply.

A gift made every 15 years may be made free of gift tax, provided it does not exceed the exemption limits (below). If the donor dies within the 15 years the gift may then incur a tax penalty.

The exemption limits in 2022 are as follows:

• Spouses/Partners – €80,724 between spouses, PACS and those in civil partnership.
• Children – €100,000 from each parent to each child (or child to parent).
• Grandchildren – €31,865 from each grandparent to each of their grandchildren.
• Brother/Sisters – €15,932 to brothers and sisters.
• Nieces/Nephews – €7,967 to nieces and nephews.

In addition to these allowances, it is also possible to make tax-free family gifts in cash (dons familiaux de sommes d’argent) of up to €31,865 to each child, grandchild, or great grandchild from each donor, or, in the absence of these descendants, to a niece or nephew.

These allowances can be cumulative so, for instance, a child may receive gifts from parents, grandparents and great grandparents individually, without one affecting the exemption limits of the other.

Survivorship Period

Even though a gift may be made tax-free every 15 years, if the donor dies within the 15-year period then the gift is added to the total value of the estate for the calculation of inheritance tax. This process is called the ‘rapport fiscal.’

The child allowances for inheritance tax are the same as those for gift tax. If gifting real estate then the situation can be made easier by applying the ‘reversionary interest’ in the property, whilst the donor retains the ‘life use’ of the property.

If the gifts made are above these exemption limits, then tax is applied rom 5% (less than €8,072 up to 20% (from €15,932 – €552,324).

For more details and information on  how to manage, maximise and protect your assets for you and your family, contact enquiries @ bgwealthmanagement.net

beaconglobalwealth.com

This communication is for informational  purposes only based on our understanding of current legislation and practices which is subject to change and is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice form a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained  in this communication is correct, we are not responsible for any errors or omissions.

Beacon Global Wealth Management are members of Nexus Global (IFA Network). Nexus Global EU is a division of Blacktower Financial Management (Cyprus) Limited (BFMCL) and Blacktower Insurance Agents & Advisors Ltd (BIAAL).  Beacon Global Wealth Management is an Appointed Representative of BFMCL which is licensed and regulated by the Cyprus Securities & Exchange Commission (CySEC) – Licence No. 386/20. Beacon Global Wealth Management is an Appointed Representative of BIAAL which is licensed and regulated by the Insurance Companies Control Service (ICCS) – Licence No. 5101

The post What is French Gift Tax (“Droits de Donation”)? appeared first on The Good Life France.

We talk to Paul Flintham, an International Financial Advisor at Beacon Global Wealth about the Assurance Vie…

Well, literally translated it means Life Insurance. However, it actually is quite different from the life insurance policy you might be used to in say the UK. An Assurance Vie is essentially a life insurance wrapper that holds investments. It’s available to French tax residents, including foreign nationals living in France. And as well as offering inheritance advantages, it’s one of the most versatile and efficient tax structures in France.

Key points of an Assurance Vie (AV)

Tax

Investments held within the wrapper are not subject to capital gains tax or income tax while the funds stay inside the policy and no withdrawals are made. You can withdraw capital tax-free. Only the growth element of any withdrawal is subject to tax. You must declare the growth every year you on your annual tax form, but no tax is paid unless you make a withdrawal. Even then the tax is only paid on the ‘growth’ part. And, after 8 years, there is an income-tax-free allowance of €4,600 per person (Social Tax is still payable). You can hold an AV in joint names, meaning an allowance of €9,200 per couple (tax is paid by couples in France).

Inheritance

Assets within an Assurance Vie may be dispersed as you wish on death, and there are tax advantages for beneficiaries. If you open the AV before you reach 70, beneficiaries of an AV have an (extra) allowance of up to €152,500 each before tax. Compared to €1594 which is the normal allowance for non-relatives (this also includes unmarried partners in France). Although if you open the AV after you’re 70, the allowance drops to €30,500 per person.

Currency savings

International AV versions can hold different currencies. This is useful if the foreign exchange rate isn’t favourable, and you have assets in different currencies.

Savings and tax

If you are resident in France but hold Peps or Isas in the UK and – you will have to declare & pay tax on their growth annually. You can transfer the cash/holdings to your AV and not pay tax (until a withdrawal).

This is a simple view of how an Assurance Vie works. But for many people this is an excellent investment vehicle for tax savings and for inheritance planning.

If you’d like to find out more or have questions about how to maximise your investments, contact Beacon Global Wealth for an obligation free consultation at: enquiries@bgwealthmanagement.net

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The information on this page is intended as an introduction only and is not designed to offer solutions or advice. Beacon Global Wealth Management can accept no responsibility whatsoever for losses incurred by acting on the information on this page.

Beacon Global Wealth Management are members of Nexus Global (IFA Network). Nexus Global EU is a division of Blacktower Financial Management (Cyprus) Limited (BFMCL) and Blacktower Insurance Agents & Advisors Ltd (BIAAL).  Beacon Global Wealth Management is an Appointed Representative of BFMCL which is licensed and regulated by the Cyprus Securities & Exchange Commission (CySEC) – Licence No. 386/20. Beacon Global Wealth Management is an Appointed Representative of BIAAL which is licensed and regulated by the Insurance Companies Control Service (ICCS) – Licence No. 5101

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