Unfair Financial Burden for retired Britons in France

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Other 'posts' on this blog deal with the substance of this.
Consider an elderly couple who retired to France before 1998. We will call them Mr and Mrs. Briton.  He is now over 80  and was a teacher.

1. His teacher's pension is (in euros) 24,000 euros, which is entirely taxed in Britain. This tax is 2627 euros (equivalent of £2285.5).  This sum would be zero if this income (as a sole income) were taxed in France. see note a/.

2. Because they retired to France before the institution of the Winter Fuel Payment they do not receive it.  This amounts to £300 at present for the over 80s = 344 euros

3. They need to find 1500 euros minimum for top-up health insurance. EU law decreees that the UK is the Competent State to carry the costs of their health care. But it does not happen.

How much do they lose out taking on board EU law?

The total they appear miss out on and/or have to find is 2627+344+1500 = 4471 euros. But note later- we need to take in their other pension - The State Retirement Pension, which is their only other income. Although taxable in France it is too little to attract more tax.

If EU law on health costs as it appears to be written was observed  they would have no health costs. see note b/.

IF all their income were taxed in France then one has to include their joint State retirement pension (11640 euros) in the calculations of taxable income in France. The French Tax bill would be  1812 euros.  This is 815 euros less than their existing UK tax bill.  The amount they lose out on then has to be recalculated as   815+344+1500 = 2659 euros

So, if all were really fair for this elderly British couple they would have an extra 2659 euros a year to enjoy life.

When they retired the exchange rate between £ and France was very favourable and these financial matters were not particularly important. Since then the £ has collapsed and they are watching the centimes.

Notes .. a. link to posting  .  'Taxation- in-France-& -UK'  ........................
          b. see EU Regulation 883/2004 Article 24. Link 'Health Costs Legal Position'

Double Taxation again -updated 10/03/2011

[To go to beginning of the blog - click here]

UPDATED 12th March 2011   ----- of individuals and companies in Europe.

This includes many British pensioners who have ‘UK Government Pensions’! Teachers, Fire and Police, Military, LGOs and so on in France.

At the end of April 2010 The European Commission launched an online public consultation to ask anyone for information on double taxation problems that they have encountered within the EU. The consultation ran until 30 June 2010.

EU Commissioner for Taxation and Customs Union, Audit and Anti-Fraud, Algirdas Šemeta, said: “Double taxation can deter cross-border activity in the EU and the functioning of the Internal Market. I am determined to tackle this obstacle. This consultation will help us to assess the real scale and financial impact of double taxation for citizens and businesses. I will then work towards finding the most appropriate and effective solutions."

The aim of the public consultation was to identify clearly the nature of the problems that EU taxpayers are facing and the extend to which many individuals and companies are encountering the problem of being taxed on the same income or profits in two or more different Member States.

Mr. Semeta indicated areas of difficulty for all kinds of taxpayers. This Blog has demonstrated clearly that for the British pensioner in France it means that they cannot benefit from tax rebates on tax paid to the UK.   Mr Semeta said ‘it is not clear how well the Double Taxation Conventions work’. This blog knows they do not! Look at Spreadsheet (click) –If your income is middling and you need a home-help it affects you.

The EU consultation concerns all direct taxes – The Commission is also inviting suggestions on how to effectively and rapidly remedy the double taxation identified.

Following the end of the consultation period [JUNE 30th 2010], the Commission published a summary of all contributions received. It analysed the replies in detail and used them in preparing possible initiatives for EU action in the field of direct taxation.

Anyone was invited to reply to the consultation by completing the questionnaire online

http://ec.europa.eu/taxation_customs/common/consultations/tax/index_en.htm

The Blog’s author completed a personal questionnaire . SEE Concern3 (click) on this site. The published report was linked here -
[UPDATE - April 2013 - The report seems to have been taken down. - The following link may give some guidance?]
http://ec.europa.eu/taxation_customs/taxation/personal_tax/double_tax_conventions/index_en.htm


I have to say - It doesn't get one very far! My comments were noted and shared I see by a Belgian.
Further recommendations are promised!

TAXUD-E1-Consultation@ec.europa.eu
Postal address: European Commission
Directorate-General for Taxation and Customs Union
Rue de Spa 3, Office 8/007
B-1049 Brussels
Fax: +32-2-29 56377