We're slowly but surely navigating the tax system in France, and we've had quite a few questions (and surprises!) along the way!
We knew that France has a tax treaty with the USA, meaning that there is no "double taxation" - but what does that really mean for us? Luckily for us (really lucky, since this wasn't something we had even thought to think about), the French-USA treaty is one of the "good" ones - I'll explain...
Our income is all from the USA, and all income is first taxed at the source (another thing we didn't know). So, we first file our USA taxes, then we use those entries to file our French taxes. On our French taxes, we claim a credit, which is equal to the amount we would have paid in France. This ends up zeroing out any French taxes.
There are some countries that have a tax treaty with the USA, but they do not allow the same type of credit - instead, you claim the amount you paid to the IRS, and that reduces the amount you pay to your country of residence.
In addition, the French have a CSG/CRDS tax, that is similar to social security. Apparently, the tax assessors often mistakenly apply that - it happened to us, but we had heard that this was also double taxation. We sent a letter* explaining this, and a month later, got this response. It says that they agree, and have removed the tax from our bill. It also says that if we have already paid the tax, it would be refunded to us automatically.
With that, our first French taxes are done! Because we weren't here on January 1st, 2017, we don't owe the taxe d'habitation this time, and because we don't own our apartment, we don't pay the taxe foncière. Done, and done!
Timing! There is so much to know about timing!
- April 15 - the usual deadline for filing USA taxes if you live in the states
- May 1 - the usual date that you can expect to be able to find the new French tax forms. These include a declaration of all non-French accounts (including banks, TransferWise, and PayPal, but not credit cards).
- May 17(ish) - deadline for first-time French tax filers (only paper filing is allowed)
- May 31(ish) - deadline for online filing French taxes (after the first time)
- June 15 - the deadline for filing USA taxes if you live abroad (and are *not* present in the states on April 15)
- September 1(ish) - French tax bills arrive
- September 15(ish) - French taxes due, if over 1000€ owed
- October 21(ish) - taxe foncière (property tax) due
- November 15(ish) - taxe d'habitation due
- December 18 - deadline for modifying French taxes
- December 30(ish) - deadline for disputing French tax assessment
- January 2019 - last, but not least! The entire tax system changes! Instead of paying taxes on the previous year, everyone will pay during the year the income is earned. (Don't ask me for details!)
We still don't know exactly how much we will owe for our health coverage, or when we will get the bill. It is assessed via PUMa, using our income taxes.
~~~
* As we're members of
ParisUnraveled, this information and a template letter were available to us.
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