Court Hammer

On February the 26th 2015, the European Court of Justice ruled that the payments of social charges on French asset and incomes (Case 623/13, Min. c/ de R) should be treated in accordance with the Social Security European Directive (1408/71).

Hence, French tax authorities may not tax, for social charges purposes, any person that is not affiliated with the French social security.

This rule applies to any taxable asset or income taxed by the French Tax Authorities.

Tax residency conditions are not relevant, meaning that even if the person is a French tax resident, if he or she is not affiliated with the French social security system, French Tax Authorities are not entitled to impose social charges on their incomes or assets.

Moreover, the French “Conseil d’Etat” has confirmed this rule in a recent decision dated April the 17th 2015 (CE 17/04/2015 n° 365511).

In the case that readers want to be reimburse of their social charges payments, they need to file a reclamation with their competent Tax bureau within two years of the payments/declaration, depending on each case.

Limitation periods may differ depending on the source of taxation.

In the case that the Tax Authorities refuse to reimburse the social charges claimed, the taxpayer needs to file the reclamation with the Administrative Tribunal within two months from the refusal.

In the case that the Tax Authorities do not answer to the reclamation, the taxpayer has 6 months to file with the Administrative Tribunal to get its reimbursement.

Our law firm has information that the French Tax Authorities may oppose specific limitation periods in the case that the taxpayer is claiming the reimbursement of the social charges paid.

The PARRAT LLATI PARRAT SLATKIN law firm would be please to assist and represent any person that requires assistance in the case that the Tax Authorities shall not reimburse the social charges paid by them.

We remain at your disposition to answer any questions as regard to the above information.

Attorney-at-Law registered with the Pyrénées Orientales Bar
Attorney-at-Law registered with the New York Bar
23 rue de la Sardane
Tel. 04 68 35 24 06

The social charges tax imposed on British and other EU non-resident owners letting or selling
their properties has been deemed illegal by the European Court of Justice, who say that a resident of the EU should contribute to only one social security system.

France may now be liable to reimburse millions of euros paid on rental and sale over the past two to three years, since the government added the 15.5 per cent “social charge” to the 20% capital gains on the sale of second homes or rental income. The addition brought the tax to a massive 35.5%. A French tax law expert had advised anyone who has not already submitted a claim to the French tax authorities to do so now, and suggests that those who have already made a claim should write to the French tax administration asking for their money back and also asking for a refund of any tax agent’s fees. The new bill was not concluded at the time of writing, so if you are considering selling a property, you may have to pay the charge and claim it back when the law is passed.


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