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Refund for Social Charges Paid Between 2012 to 2015

Written by: Bridgewest

Refund-for-Social-Charges-Paid-Between-2012-to-2015.jpgThe social charges imposed on rental income and capital gains produced by non-residents in France will be maintained in 2016. The tax liability will be applicable on income derived from rental and investment income in France produced in 2015, taxable in 2016. These social charges are maintained despite a ruling from the European Court. However, individuals have already applied for tax refunds for these payments made until 2015. The experts at our law firm in France can help you with tax compliance in the country if you are a non-resident.

Social charges for non-residents in France

Earlier in 2015, the European Court released a judgment confirming that social charges on income and capital produced by non-residents in France from other EEA countries were illegal. This decision was also confirmed by the French Court. These two rulings have allowed a large number of individuals to claim tax refunds for the amounts paid between 2012 and 2015.
The fund established by the French government for allocation of the income support is non-contributory, which makes non-resident individuals and those who are not affiliated with the French social security system still liable for certain social charges on income. Although no clear guidelines have been released yet as per the enforcement of this tax liability, most likely individuals will be liable for rental and investment income earned in 2915, which is taxed in 2016.

Court rulings for French social charges

Those affected by the change were migrant workers in France. For example, a Dutch or Belgian employee in France who was also a resident but still subject to the social security system in his country of origin should not have been liable for French social taxes on investment income derived from his home country. 
It is not yet known if the change in the law that still allows for the taxation of the income produced in 2015 is in line with the European requirements. French judges have not declared it unconstitutional, but they will not clearly state if it complies with the current European laws for the taxation of non-residents.
Our lawyers in France can give you detailed information about the taxation system in the country as well as updated information about relevant tax changes. Contact us for more details. 


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