Tax on UK pensions..... France and UK

Sorry for being a bit thick here… Just noticed that my husband and I have to pay some income tax - whoops! (only noticed when looking at Tax Fonciere Invoice - first full year here)… and there is just over 2k to pay in income tax… We both have UK State pensions and also a small Local Government pension that we pay tax on in UK… I will make an appoint to see bank manager hopefully reassuring me this is or isnt correct… but any advice would be useful in the interim… Many thanks… Jane

You’re not being thick… you are quite rightly questioning your situation… :+1:

Thanks Stella… you are always so reassuring… seriously… thank you…

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There are more experts on here but it’s definitely right that you pay tax in the UK on government pensions, but you should get that back against your French tax return. I imagine you filled in a French one this year? Obviously I’ve no idea what your income is and have no need to know (!) but if what you’ve described is your only income then 2k sounds quite a lot.

I’m a bit puzzled about you noticing income tax when looking at your Tax Fonciere as they aren’t really connected …

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Just an extra thought @Dave_Lawson was very helpful to us about pensions. He might be prepared to help?

Hello Jane, arm yourself with all docs and lots of patience and go and see your impôts people and also your impôts fonciers people, (they may not be in the same place)

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Thanks everyone… very helpful as usual… Yes… I can see both of these documents… Tax Fonciere and the Avis d’impot under the section ‘Tableau de Bord’ on the Impot.gouv.fr website (have to log in obvs)… My husband looked as though he had been hit by a bus when I have just informed of this :grimacing:) he doesnt take bad news very well… !!! I have just emailed the tax office in Sarlat hoping they will see me quickish… if not then its France Services again… they are very helpful indeed… Again, thanks to all… I shall let you know… Jane

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I should just mention that UK State Pensions are not government pensions and are therefore taxable in France.

What isn’t taxable are such as teachers, police officers and, in my late wife’s case, local government pensions.

Speaking as someone who has lived here in comfortable circumstances for 24 years, I have never paid a penny in income tax. The bar is much higher here than in the UK.

Whilst I hope this is some sort of mistake… and you don’t owe any huge sum…

I believe that if there is a genuine financial difficulty… the Tax people might agree to instalments… :crossed_fingers:

Jane, a “quick and dirty” calculation (simulator below) would suggest that two sets of UK state pension= about 26000€, and for a couple with no children (assumed) , you’d not expect to pay any French income tax. Without getting into the technical mechanics of the French treatment of your UK local government pension, even if you added in another 10000, it would barely create any liability to French tax.

Unless there was a recent large lump sum pension payment from the government pensions?

Is the amount you have been asked to pay income tax or social charges? They are set out separately on your avis.

If you haven’t got an S1 from the UK, and didn’t tick box 8SH then you may be charged these. 19.2% so can be a significant sum.

Thanks Jane… Definitely income Tax not social… We do have S1’s… My husband went to the tax office to fill this form in with a bit of help so am presuming its all good… I really think I need to find somebody to untangle this for me with the benefit of the copy of the avis, actual figures and the completed form… any recommendations of a tax advisor would be gratefully received… many thanks. Jane.

no large lump sums unfortunately…

Hi George, thanks for your input… very helpful… total ball park figure (after paying UK tax) is about 55k euro… per annum thats two state pensions and one local government pension… When my husband went along to the tax office to fill out his tax return for the first time he showed them his 2023 tax statement and obviously all taxes paid… I, very stupidly thought that was it!! We have absolutely no ‘complications’ - our situation must be very straight forward… Again, I appreciate your help…

Hi, I am away until the 9th September I’m happy to help you with this… should be able to see where the problems are from your return.

Feel free to book a meeting in when I’m back -

Don’t the French do, I think it might be called top-slicing?

Where even if they accept that the say, 29000 euros worth of uk government-type pension is taxed only by the UK, this income is still added to other income (the 2 state pensions) to determine the tax bracket the total income falls into in France? So looking at tax on the 2 state pensions that could be at a higher rate than if they were the only income.

So guessing around 28000 per part - does that mean 1000 tax could be due per part?

This is highly interesting and I hope you’ll tell us the final answer. I’d definitely say just make an appointment directly with Impôts as it doesn’t sound complicated enough to involve an adviser. Impôts here are fine to talk to.

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Yes, you’re right and I bet that’s the answer.
They do the same with UK rental income. It’s taxed in the UK but it can still push you into a higher tax bracket for your other income.

I agree wth you and Helenochka. This may well be some or all of the ‘culprit’ in Jane’s situation. It’s what I was, rather grandly, referring to in my reply above

It’s known as Exemption with Progression, or taux effectif and applies to many UK government pensions and UK rental income as Helenochka rightly says. It’s not a true exemption in my book, due to the knock on consequences on other French taxable income, but that’s what they call it!

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Hi @janewalker55

'We both have UK State pensions and also a small Local Government pension that we pay tax on in UK’

‘total ball park figure (after paying UK tax) is about 55k euro… per annum thats two state pensions and one local government pension’

'We do have S1’s…

and there is just over 2k to pay in income tax…

'emphasized text

Looking at your comments I would say the income tax due in France is correct. Your S1s mean your state pensions are used in the tax calculation in France and although your ‘small’ local government pension has tax deducted in the UK the amount is still used to calculate the tax bracket you fall into here.

My experience based on the figures you have provided suggests the french tax calculation is correct.

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