Reclaim of French Social Charges
It is official! The French Tax administration has confirmed in a press release on 20th October 2015 the requirements for a refund of the French social charges.
The “Conseil d’Etat” (CE), in a decision dated 27th July 2015, drew the consequences of the European Court of Justice (ECJ) judgment of 26th February 2015 (Case C-623/13, Mr de Ruyter). It has been confirmed that it is contrary to European Law to levy social charges on French income-generating assets of individuals affiliated to a social security system of another Member State of the European Union (EU), European Economic Area (EEA), or Switzerland.
You must be registered with a non-French social security scheme located within the EU, EEA or Switzerland.
If you are not residing in France you can reclaim the social charges that you have paid on your French property rental income or the social charges that you have paid on the gains made during the disposal of your French property.
If you are residing in France, you can reclaim the social charges you paid on your assets income as well as your investment products.
The total rate of social charges is 15.5%.
The French Tax administration confirmed that the 2% solidarity levy (“prélèvement de solidarité”) paid before the 1st January 2015 is not affected by the Ruyter case as this tax does not finance the French social security system.
Under French law, any tax claim must be issued by 31st December of the second year following the year in which the tax was paid.
Therefore it is important to note that non-residents who have paid social charges in 2013 on their 2012 income have until 31st December 2015 to submit a claim to receive their refund. Similarly, non-residents who sold a French property in 2013 and have been subjected to social charges also have until 31st December 2015 to claim the corresponding tax.
Individuals who have paid undue social charges in 2014 or have recently received their tax assessment are recommended to issue a claim at the soonest convenience.
How to claim the social charges?
Non-residents can issue tax claims to the French tax office or to your registered tax office. The claims must be legally motivated and include all supporting documents establishing the right to claim for a refund of the French social charges.
We recommend that you seek legal advice in order to ensure your claim has been correctly drafted and supplemented with the necessary supportive documents.
At Frontier Fiscal Services, we are happy to assist you in claiming back the social charges you have paid. You will be represented by a French tax lawyer, who will submit and assess any potential claim.
Please contact us if you would like further information regarding this matter or would like to pursue such a claim.
Frontier Fiscal Services