Non taxable disability income

[SP1DER]

A friend has a disability pension which is not taxable in the UK. I seem to remember that you do not have to declare non taxable income on tax form here, does anyone have a link to the appropriate Impots article?

[F Flinstone]

The wife is in the same situation, for the past 12yrs we have declared all our income which in my case is ex- government worker and the wife's disability, I have only ever paid tax in the UK on my pension, no taxes here in France. However this year we have been taxed in France a thirty times increase over what I was paying in the Uk Have gone through three different tax department and they say I should pay it here, having just received my P60 and the wife's proof of un-taxable income, I have sent nine copies to each of the three departments, fingers crossed Has something changed this year I dont know, perhaps someone will enlighten us.

[Tom]

Premium bond winnings are non taxable in the UK but the French Impôts don't see it that way and those winnings are taxed. Maybe there are similar rules for disability benefits from the UK as well.

[ANOther]

I seem to remember that you do not have to declare non taxable income on tax form here, does anyone have a link to the appropriate Impots article?

It can't be that simple as a 25% pension commencement lump sum (PCLS) is tax free in UK but taxable in Spain.

[exile]

The double taxation treaty is the bible in this case and I can find no mention of disability income. It is therefore not covered by the treaty and even if non-taxable in the UK will be taxable in France for French residents.

Edit to add link:

https://assets.publishing.service.gov.u ... _force.pdf

[Catrose]

Everything must be declared in french tax return, even if you have paid tax on it in the UK (when you will not be out of pocket as get credits). And even if you believe it is something that is non taxable you must declare it. The fines for not declaring things are high, even if no tax was actually due on the sum in question!

[Tom]

Everything must be declared in french tax return, even if you have paid tax on it in the UK (when you will not be out of pocket as get credits).

HMRC will eventually send you a credit but it can be quite kerfuffle because the Impôts have to process your UK claim form. You can't submit the form directly yourself. Thankfully interest in the UK is now paid gross.

[SP1DER]

I think the answer is to declare the invalidity pension + work pension and since he was in government service the whole lot must be taxable in the UK therefore a credit will be given here which means that the total will not be taxed here. The only other thing he has is UK state pension which will be taxable here. That seems to solve it, however as it is his first return I think it is probably best if I go to the tax office with him to get a definitive answer.

Thanks all for your posts.

[Catrose]

HMRC will eventually send you a credit but it can be quite kerfuffle because the Impôts have to process your UK claim form. You can't submit the form directly yourself. Thankfully interest in the UK is now paid gross.

Doesn’t work like that for me.....I pay UK tax on my pension, declare it to French authorities. The gross amount is added to my overall revenue (Revenue fiscal de reference, RFR) to calculate the tax I ought to pay, and then the tax due on that pension is credited back so I don’t pay twice. I think what you are referring to is if you get a bit of tax on interest payments or the like.

[Tom]

Doesn’t work like that for me.....I pay UK tax on my pension, declare it to French authorities

Thanks for the correction. I was talking about the problems I had with claiming a tax refund on interest and dividends which used to be taxed at source in the UK.