Question from the reader: I am a pensioner living in France and receiving a UK police pension, which is taxed in the UK. Do I have to complete a French tax return, even if I have no taxable income in France?
The short answer is yes.
Income from foreign pensions is declared in France, even if it has already been taxed abroad – this is the case for British “government” pensions of residents in France.
This is not so that it is taxed again but so that France has a complete vision of your world income.
The main thing is to be clear about the type of pension. UK retirement income will be a state (“old age”) pension, a private pension, an occupational pension or a “government” pension.
Our reader receives a police pension, which falls under the category of “government pension”.
You can read more about other pensions that fall into this category on page 31 of our 2022 Income Tax Guide, which you can buy here.
Under the UK-France Double Tax Treaty, government pensions are only taxable in the country that pays them, unless you live in the other country and are a national only of the country where you live (i.e. a person who is only French and lives in France is taxed in France on a UK government pension).
However, even if they are only taxable in the UK, they still have to be declared in France to be “taken into account” in the overall tax calculation.
As such, they benefit from a tax credit that cancels out any real tax.
Although they may be “taken into account”, under the UK-France Double Tax Treaty, public pensions are taxable in the UK and therefore not subject to income tax. income in France – the treaty treats them as taxable in the country from which they are paid.
As a result, they may also not be subject to social charges.
How do you report government pensions?
UK public service pensions are reported gross and must be entered into form 2047 section 6, for income qualifying for a “tax credit equivalent to French tax”.
Check out our quick guide below, taken from our 2022 income tax guide.
Why do I have to declare even if it is not taxed?
Some non-French income, including UK ‘government’ pensions and UK rental income, receives a tax credit from France.
This “tax credit” income must always be declared on your French tax return, even if it has already been taxed elsewhere (for example in the United Kingdom).
The credit is granted following the taking into account by the French authorities of this income in the calculation of the tax. It cancels the French tax that would have been paid on this income if it were ordinary income taxable in France.
The result is that it may result in increased tax on your taxable income in France due to it entering a higher tax bracket or more of it in your highest bracket. The aim is to prevent you from benefiting from the tax allowances of two countries (i.e. the first ‘zero%’ brackets).
A provisional tax return called Notice of declarative situation for income tax (Asdir) is issued immediately after making an online declaration.
In the case of people who do not have income tax to pay due to a low French taxable income (like our reader), this document is their only certificate and it is a copy of it which is sent if you receive paper documents (as opposed to the tax notice from which French taxpayers benefit).
You will need your opinion or Asdir for administrative procedures such as applying for income-related benefits. It will contain your reference tax income (annual net taxable income), which is necessary for various formalities as well as other information such as your number of ‘family quotient shares’ and the contact details of the tax authorities.
To find out more about income tax reporting in France, download our cheat sheet, Income tax in France 2022 (for 2021 income). As a downloadable digital guide, priced at €14.90, it was last updated on April 8. Order your copy here
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