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Tax Under Magnifying Glass

Last week we posted about the social charges of 15.5% on the sale French Property by UK owners since 2012. We have since received an important update from our advisers Sykes Anderson Perry stating that you need act fast if you should seek to be refunded.

The Advocate General recently gave his opinion on the social charges on non-French residents who have sold property, firmly siding with then tax payers and against France’s position. The EU Court decision is expected imminently and is very likely to find that France’s law imposing social charges on non-French residents is illegal. On the face of it this is good news and people across Europe who have paid the charge should be able to get a refund. However there is an unwelcome sting in the tail.

Time limit for claiming refund

One would imagine the time limit for claiming a refund of the 15.5% Social Charge would run from the date of the EU court decision finding France had acted illegally in levying it. However this is not the case. France changed its internal tax procedural law in 2013 to make reclaims much harder. This has sadly received no publicity.

Under the new French rules the time for claiming back the social charge runs for one calendar year from the end of the year the social charge was paid. In other words if you sold your property in 2013 your time to claim a refund expires on 31st December 2014.

After this date your right to claim a refund is time barred. Claims for sales in 2012 were accordingly time barred after 31st December 2013. Sales in 2013 will be time barred after 31st December 2014.

This internal French procedural rule may well infringe EU law though it will probably take another case to resolve this. In practice anyone who sold a French property in 2013 should take urgent advice now well before the cut-off date of 31st December 2014.

It is worth bearing in mind that the Christmas period will cause difficulties for last minute claimants. People who sold in 2014 may also be minded to take steps now. People who sold in 2012 will be in a much harder position.

This information has been prepared by Sykes Anderson Perry Limited as a general guide only and does not constitute advice on any specific matter. We strongly recommend that you seek professional advice before taking action. No liability can be accepted by us for any action taken or not taken as a result of any information or advice given or omitted. The information herein does not constitute investment advice.

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