English
FrançaisCan anyone help advise on how to complete the EEA Furnished holiday lettings section on a UK Self assessment return? From what I understand the big difference to the French return is that you cannot include for the depreciation which leaves tax to be paid in the UK? Any tips on how to correctly declare any tax due (wihtout overpaying) would be appreciated.
The UK and France have a double taxation treaty, so you will not get taxed twice. You will probably pay tax in France, and where the UK tax is more than the French tax that extra bit is paid in the UK. However, if the UK tax is less, you pay the tax in France as normal – I’m afraid you can’t get a refund because the UK tax is lower.
In the UK, you can deduct expenses from your rental income when you work out your taxable rental profit as long as the expenses are wholly and exclusively for the purposes of renting out the property. [see below in the expenses allowed in France - most countries allow the same expense types]
In France there are various regimes applicable to rentals, depending on whether the property is rented furnished or unfurnished. In both cases, an itemised regime allows the deduction of all charges pertaining to the activity and subject to proper evidence and proof of payment.
Which is the simplest accounting method I can adopt? The accounting regime which requires the least amount of paperwork and the least number of French tax forms to be completed is the Regime Micro-Entreprise. This is where 50% of income is taxed at a flat rate of 20%, regardless of actual expenditure. It is only the income which is declared.
Can I adopt the Regime Simplifié method of accounting even if I only have a small amount of turnover? Yes - you can adopt the Regime Simplifié. What items of expenditure can be offset against my rental income under the Regime Simplifié?
The following are list of allowable expenditure items:Local Taxes (Habitation / Fonciere)
Utilities (Gas/Electricity/Water/Telephone)
Publicity/Postage/Stationery
Small Purchases less than 400 Euros per item
Maintenance/Small Repairs/Cleaning
Travel Expenditure
Buildings & Contents Insurance
Professional Fees
Bank Fees
Mortgage Interest
Management Charges/Agent Charges
French Mortgage Interest
Large Renovation Works
Furniture