In the past year, Le News and specialist publications such as French-Property.com, have highlighted the problems facing Swiss-based (and other) non-residents of France. Taxation of rental income and unequal capital gains of non-residents are now the source of considerable legal controversy in France.
Earlier this month, the Avocat General of the European Commission gave an opinion that French social charges on the rental income and capital gains of non-residents did not conform to European law. And in a recent legal ruling in the highest administrative court in France, the Conseil d’État, the rate of capital gains tax of 33 percent imposed on residents from outside of the European Economic Area (EEA) was also declared contrary to European law. The standard rate is 19 percent.
This has opened the way for non-residents to claim refunds. According to French-Property.com, “we still await the decision of the European Court of Justice on this matter, but it is entirely likely that the opinion of the AG will be followed in their ruling. France is facing a wave of litigation on non-resident social charges and higher rate capital gains tax”. Good news perhaps for non-residents, but refund claims need to be submitted by 31 December 2014.
Tax claims are frequently challenged by the French authorities for the sums involved are huge, with social charges on the rental income of non-residents alone amounting to an estimated €134 million last year.
To obtain a refund it is necessary to claim it within two years. French-Property.com advises that if you were over-charged in 2012 you need to claim by the end of December 2014 and if overcharged in 2013 you should get your claim in as soon as possible as the two year deadline is not rock solid.
French-Property.com is organising a collective approach to making a claim. It already has several hundred claims being filed or in the process of being filed. Contact them for further information:
Le News and courtesy of French-Property.com