Moving to France » Pensions/savings

Pensions and savings in France

Published: 6 January 2011

Pensions and savingsYour options for long-term financial planning are wider before you have made the jump across the Channel.

For example, one key financial product, known in France as assurance-vie is exempt from French inheritance taxes if the investment is made before you become fiscally resident in France.

One of the most talked about pension products for people moving abroad is a Qrops (Qualifying Recognised Overseas Pension Scheme). This is a possible product for your personal pension fund.

There is also the Qnups (Qualifying Non-UK Pension Scheme): an arrangement into which you can place normal investments (rather than your pension funds), without limit, even if you are already retired.

Useful tip

  • The treatment of some of these products with regards to taxation could change during 2011. You should always seek professional advice before making an investment decision.

The Spectrum Group

In the full Moving to France helpguide, we explain:

  • Using Qrops for your personal pension fund
  • Minimising the burden of UK-specific taxes
  • Tax on pension drawdowns
  • Choosing your fund’s currency
  • Transfers, fees and management charges
  • Qnups: a loophole to avoid UK inheritance tax
  • Assurance-vie for lump sum French investments
  • Tax-efficient savings options

Download the guide as a PDF now from this link
…or ask a question about this topic in the comment box below.

4 Comments »

  • j bourne said:

    We are moving to france and will have £150,000 to invest in order to give us a top up to our yearly pension should we invest this in france or uk and if so what options are available we are assuming we should be in the french tax system with income of £14,000 gross plus any income from the invested money how much french tax would we have to pay

    [Reply]

    Moving to France editor Reply:
    June 9th, 2011 at 4:03 pm

    Tim Yates, from Spectrum Group, replies:

    “Dear J Bourne,

    Thank you for your question. Without knowing more about your family and financial situation what I can say is that there will be a number of tax efficient savings and investment options open to you once you become resident here. It doesn’t make sense to leave your capital in the UK because although it might be tax efficiently ‘wrapped’ according to UK rules the French administration will not recognise it as such when you are resident here. ‘Assurance Vie’ is one of the investment vehicles worth considering because when you draw income from it you only pay tax on the growth element and the rate of tax reduces with time. In addition if you set this up before you become French tax resident then it is completely outside your estate for inheritance tax purposes.”

    [Reply]

    # 17 April 2011 at 10:44 pm
  • Rita Goodman said:

    We are resident in france but still have a small investment in England which pays us a monthly income. The French charge us a social charge on the full amount that we receive each month, but our income is too small for the income tax.

    is there any way we can re-invest this money in France or England, which will still give us a monthly income but not attract the social charge? We really cannot afford it.

    [Reply]

    Moving to France editor Reply:
    February 15th, 2011 at 12:36 pm

    Blevins Franks respond:

    Dear Mrs Goodman,

    Most conventional investments (e.g. generating income or dividends) are liable to French tax and social charges at the time the income is received. Any UK tax paid can be deducted against the French tax and social charges payable. Even if you do not have a tax liability in France, any UK taxes can be deducted from the French social charges.
    You cannot avoid paying the French social charges on your investment income, but you could reinvest your funds in a more tax efficient vehicle, such as an assurance vie, which can reduce the amount of income that is liable to the social charges, thus reducing the amount of social charges payable. French banks also offer tax efficient savings accounts, such as the Livret A and Livret Bleu, but these tend to pay a low rate of interest (around 2% currently) and the amount that can be invested is capped at around €15,300.

    [Reply]

    # 1 February 2011 at 12:17 pm

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