Stephen Smith (France) Ltd

[Site Admin]

Income Tax – New rates

From 2007, it is likely Income Tax will be levied at four new rates depending on the tax band your earned income falls into: 5.5%, 14%, 30% and 40%.

As part of Prime Minister de Villepin’s overall proposed strategy for fiscal reform, the Finance Minister, Thierry Breton, and the Budget Minister, Jean-François Copé, have revealed new tax rates in an interview given recently, reported the French daily “Le Figaro” on 15th September.

Proposed Tax Band (income in Euros)......Rate of tax
0 - 5,514..................................................0%
5,515 - 10,846.........................................5.5%
10,847 - 24,431.......................................14%
24,432 - 65,558.......................................30%
65,559+...................................................40%



The figures are for a single taxpayer.

This represents a simplification over the current situation outlined below, two of the existing tax bands going, 28.26% and 42.62%.

Current Tax Band (income in Euros)......Rate of tax
0 – 4,334..............................................0%
4,335 – 8,52.........................................46.83%
8,525 – 15,004.....................................19.14%
15,005 – 29,294...................................28.26%
29,295 – 39,529...................................37.38%
39,530 – 48,747...................................42.62%
48,748+...............................................48.09%

[walter]

I am planning on moving to France to take up permanent residence with my wife and child. I will continue to work for my UK employers, with about half the work done in the UK and the other half in France. So being resident in France, how will this affect my tax compared to what I pay in the UK assuming an annual income of about 90k GBP? I obviously need to engage with an accountant but was just curious what the situation would be and would I be signifcantly worse of IRO tax?