FRANCE AS A TAX HAVEN

With many people transferring money out of Ireland to foreign banks, some will be considering going the whole hog and leaving altogether. The Sunday Times says France could be about to add yet another reason for wealthy individuals to relocate there by unveiling new plans for a wealth tax overhaul next year.

Currently, ex-pats pay wealth tax on their French assets only for the first five years of being resident there – after this, tax is levied on all assets worldwide.

People can expect to pay an annual wealth tax of between 0.5% and 1.8% of net assets – property worth €800,000, less the value of any loans secured against it.

Under the new regime, this figure would rise to €1.3m and the tax rate for assets above this figure would be 0.25%, rising to 0.5% on those above €3m. This means anyone with property worth €2.5m could expect to pay €5,480 less in wealth tax.

And France isn’t stopping there in its bid to attract high net worth individuals. Any professional income earned in France during the first five years of residency will get a 30% tax rebate and temporary residents who have moved there for work will get a 50% reduction in tax on passive interest, capital gains and dividends generated in any country within the European Union.

Inheritance tax between spouses has already been abolished in France and the first €159,000 in assets willed to each child is exempt as long as there have been no taxable gifts given in previous years. However, tax between unrelated individuals can be as high as 60%.