A Resume of the French Budget - 2013

As widely predicted, President Hollande has made decisive inroads into cutting the French deficit by implementing several key tax rises.  The main areas of concern for individuals are:

•    Taxes on income including investment income
•    Capital gains tax
•    Wealth tax

SCIs can seriously damage your wealth!

Over the years it has become popular for UK domiciled individuals to buy and hold their French property by way of an SCI – a French property holding company, the like of which is not known under English law.

France - Hollande’s 2012 Tax Reforms

President Hollande has finalised his three major reforms in the areas of wealth tax(ISF), succession tax and the imposition of social charges on rental income belonging to non-residents.

The good news is that if your household’s total wealth is less than €1.3 mill, you will have no wealth tax to pay.  The bad news is that if your wealth amounts to more than €1.3 mill, only the first tranche of €800.000 is tax free.

UK and US sign FATCA agreement

On 12 September 2012, the UK and US governments signed the agreement to implement the reporting and withholding provisions enacted in the Foreign Account Tax Compliance Act.  This will enable the US authorities to obtain information on accounts held by US citizens or Greencard holders at Foreign Financial Institutions (FFIs).

Budget Reminder Implications of the UK top rate reduction

The reduction in the top rate of income tax in the UK from 50% to 45% takes effect from 6 April 2013 so if you are a high-earner you should be taking advice from your Account Manager on steps which will maximise tax reliefs at the 50% rate. 

Contact PetersonSims at: 

UK +44 (0)1626 572100 

France +33 (0)533520933

www.petersonsims.com

Tax Return Amnesty – Act before 2 October!

Higher rate taxpayers who have previously failed to submit tax returns for 2009/10 or earlier years can benefit from HMRC’s Tax Return Initiative but only until 2 October.