Social charges on private pensions outside of France

First of all, this article is not for you if you are in receipt of a state pension meaning you are under the French health system via an S1 form.

This is only for people who are in receipt of a private pension (not government pension like civil servants, NHS, army, etc..) just private pension.

Apparantly since 2015, if you only have a private pension, these are subject to social tax charges and you have to declare them on page 1 of the 2047 and also page 4, section 8 :

Under this section :

And also report it on the 2042C under this section :

Your private pension is either not taxed (if under a certain amount), taxed at 3,8%, 6,6% or 8,3% depending on your worldwide income called RFR (revenu fiscal de Reference which is shown on the first page of your « avis d’imposition »). RFR is a bit lower than your total worldwide income as it includes a discount (usually 10% and tax credit added).

Those are the 2021 figures so, the RFR that is written on your 2020 income tax return. Can’t find the one for this year yet ! If you find it, please send them to me. To estimate, the one for this year is probably around 5% higher than last year to take into account inflation.

So if you are a couple who have a RFR of 25 000 euros (let’s say 15K of rental income from the UK and 10K of private pension) then you would have to pay 6,6% on your 10 000 euro private UK pension so, 660 euros of social charges.

You can then deduct some of the amount of social charges off your private pension for next years taxes. Don’t ask me why !

So the year after, instead of declaring 10 000 euro of private pension, you will declare 10 000-380 euro so 9620 in line 1AM or 1BM. But you have to enter 10 000 in line 8TH to be taxed again at 6,6% !!!

This is so complicated and to be completely honest (and hopefully it stays between us), I have never done it before. First of all, because if it is your first year, you do not know what your RFR is and secondly because no tax office has even mentioned it to me or any of my customers (not in the Charente anyway !). So, it is up to you if you want to do it or not. Knowing that none of my customers have ever got a tax demand for not doing it.

However, when you tick the « pension » section box online on the 2047 this box does appear telling you to enter them:

Which would indicate to me that maybe they are now looking into it. Not sure how.

The tax office can go back 3 years to check what you have done and the fine is basically paying it with an increase of 10% so, if you did not pay the 660 social charges as per my example above, you then have to pay 726 euro (660+ 66 as a fine).

To sum up, it is not relevant to you if you are on a S1 form for the French health system (so you are probably in receipt of a state pension) and if you are not on the French health system at all (meaning you have private medical insurance and do not have a carte vitale). And it also does not affect Gouvernement pensions (police, NHS, etc).

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