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Freelance taxes planning

#21
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countryfree said:
Thought everybody knew that.
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Looks like I'm the only one who didn't know this.
But, looks like there's a solution (this one I got from the tax consultant): you can register yourself as living in another EU country (e.g. Poland, Romania, ...). You can rent a cheap apartment there and pretend living there. Like this you will pay taxes in this country (~10-15%) and you will be able to live in any other EU country (as far as it's impossible to track your real place inside EU).
 
#22
The 183 day rule applies regardless of residence. Residence is a key defence in all cases unless there is proof to the contrary. In many cases, financial ties to a country can enforce entitlement to collecting taxes. No financial ties to France would make a difficult case to collect.

As I said previously I know many French IT consultants who have their residence (not a physical home) in Andorra and also the company there. Due to new double taxation with other countries, they introduce a low VAT and income tax for individuals and companies. Since you might have clients outside of France you could justify not spending 183 days in France. Just my thoughts on your opening comments.
 
#23
WhiteAngel said:
Looks like I'm the only one who didn't know this.
But, looks like there's a solution (this one I got from the tax consultant): you can register yourself as living in another EU country (e.g. Poland, Romania, ...). You can rent a cheap apartment there and pretend living there. Like this you will pay taxes in this country (~10-15%) and you will be able to live in any other EU country (as far as it's impossible to track your real place inside EU).
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Give it a go and let us know how you get on with that solution...lol.
 
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#24
Old Spice said:
The 183 day rule applies regardless of residence. Residence is a key defence in all cases unless there is proof to the contrary. In many cases, financial ties to a country can enforce entitlement to collecting taxes. No financial ties to France would make a difficult case to collect.

As I said previously I know many French IT consultants who have their residence (not a physical home) in Andorra and also the company there. Due to new double taxation with other countries, they introduce a low VAT and income tax for individuals and companies. Since you might have clients outside of France you could justify not spending 183 days in France. Just my thoughts on your opening comments.
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Thank you, @Old Spice. Do you know the full process how they arranged all of this? Do they send any notifications to taxman or did they declare that they've moved out of France?
 
#25
Martin Everson said:
Give it a go and let us know how you get on with that solution...lol.
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I still didn't understand well the situation with DTAA. Let's say I work with USA from France all the year and I got only foreign income. As far as there's a DTAA between France and USA I won't pay any / I will pay just a small amount of taxes in France and all other taxes will be paid in USA. Is this right?
 
#26
Where you have to pay your taxes is where you physically live.

The rest is blablabla as I said. If you have multi millions dollars business owner who leave France every single year since 2012 it's because there is no other solution for them. And trust me, they have the money for get the best tax lawyer as possible.

I'm French, I do some business, I quite the country because there is no other solution for me.

You can ask all the question you want, find all the tips and tricks about the French Taxman you want. The truth is simple : leave France, or pay your taxes there.
 
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#27
W4rhol said:
Where you have to pay your taxes is where you physically live.

The rest is blablabla as I said. If you have multi millions dollars business owner who leave France every single year since 2012 it's because there is no other solution for them. And trust me, they have the money for get the best tax lawyer as possible.

I'm French, I do some business, I quite the country because there is no other solution for me.

You can ask all the question you want, find all the tips and tricks about the French Taxman you want. The truth is simple : leave France, or pay your taxes there.
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Thank you @W4rhol. I don't like the scheme with residence in another country as it's still illegal. I'm currently trying to understand DTAAs. Looks like I don't fully understand it's concepts. If I got main source of income (~95%) from outside of France and there are DTAAs with these countries, doesn't this mean that I shouldn't pay taxes on this foreign income in France but they should be paid in countries of origin?
 
#28
No you have to pay all your cotisation and taxes to the URSAFF in France.

Exemple :

I live in France, I receive my salary from a Singapore company
-> I have to pay my taxes in France and All the cotisation for the URSAFF as Well.
Because of DTAA, I pay my taxes in France, so I don't have to pay double taxes in Singapore (because I don't live there)

I live in Singapore, I receive my salary from a Singapore Company (or whatever)
-> I have to pay my taxes in Singapore, and because of DTAA I don't have to pay my Taxes in France.
 
#29
W4rhol said:
No you have to pay all your cotisation and taxes to the URSAFF in France.

Exemple :

I live in France, I receive my salary from a Singapore company
-> I have to pay my taxes in France and All the cotisation for the URSAFF as Well.
Because of DTAA, I pay my taxes in France, so I don't have to pay double taxes in Singapore (because I don't live there)

I live in Singapore, I receive my salary from a Singapore Company (or whatever)
-> I have to pay my taxes in Singapore, and because of DTAA I don't have to pay my Taxes in France.
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I see... So, it's impossible to pay Singapore taxes in Singapore and French ones in France?
 
#30
I don't mean to be rude WhiteAngel but read the text of the DTA everything is explained clearly there is no point in guessing how it works.;)

If however you feel your are smarter than over 20,000 French millionaires/billionaires and their financial advisory teams and have a solution then go with it. Otherwise just accept reality but if I see smart people rushing for the exit I don't hang around to see whats going on :eek:
 
#31
Martin Everson said:
I don't mean to be rude WhiteAngel but read the text of the DTA everything is explained clearly there is no point in guessing how it works.;)

If however you feel your are smarter than over 20,000 French millionaires/billionaires and their financial advisory teams and have a solution then go with it. Otherwise just accept reality but if I see smart people rushing for the exit I don't hang around to see whats going on :eek:
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I'm just trying to better understand "why" it doesn't work so in the future, when my conditions change (e.g. I change the country, I create a company, ...), I'm able to find the best tax solution myself without bothering you.
As far as I understood from @W4rhol answer, DTAA is useful only for non-residents of the country, so they don't pay taxes once more in an abroad country.
 
#32
@Martin Everson I got one more question:
Imagine, my parents / relatives open an offshore company on theirs name and hire me as a worker in this company (they are going to be officially CMC). They will pay all required taxes in theirs tax favorable country and I will receive just a non-taxable amount of money as salary. Does this sound legal? Are there any problems in working in your relatives company?
 
#33
WhiteAngel said:
@Martin Everson I got one more question:
Imagine, my parents / relatives open an offshore company on theirs name and hire me as a worker in this company (they are going to be officially CMC). They will pay all required taxes in theirs tax favorable country and I will receive just a non-taxable amount of money as salary. Does this sound legal? Are there any problems in working in your relatives company?
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CMC ???

You are going to pay yourself annually just under 10k euros and pay from that your CSG and CRDS just to have zero tax rate? ns2

I wouldn't advise you to do this even if it is legal. If the taxman can prove you have control over the company regardless of whether your parents are on paperwork it will cause you problems.
 
#35
WhiteAngel said:
CMC - Central Management and Control.
Are there any possibilities to prove that the real control over the company is in my hands? Actually, I don't need any control. I'm absolutely OK with the fact that my parents are going to be an effective management and I will just work as a freelance dev in this company. Are there any flaws I'm missing?
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Well CMC will be in France. You will be controlling the company. You are the person with significant control over the company. I doubt your parents if cross examined would survive the lie.
 
#37
So your parents are going to be brains behind the company i.e form it, operate it, operate account and handle all communications with authorities etc? so you are not the person behind it all? Read my last comment. If your parents are cross examined and could survive the lie then there is no issue.pa##¤

I think somehow you have already decided the answer bor&%#
 
#38
Martin Everson said:
So your parents are going to be brains behind the company i.e form it, operate it, operate account and handle all communications with authorities etc? so you are not the person behind it all? Read my last comment. If your parents are cross examined and could survive the lie then there is no issue.pa##¤

I think somehow you have already decided the answer bor&%#
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OK. Great. I don't see any lie here but I got your idea. Thank you, @Martin Everson !
 
#39
So your plan to avoid tax is to outsmart the taxman!
Wow!
My plan has always been to be out of reach of the taxman.

Besides, France is a terrible country. Each time I'm going there, there are strikes. I also remember being ill there, and I had trouble buying medicine as I didn't have the French health insurance card.
 
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#40
WhiteAngel said:
Do you know the full process how they arranged all of this? Do they send any notifications to taxman or did they declare that they've moved out of France?
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I'm assuming they notified the French authorities they moved out of France and broke all financial ties. Getting the Andorrian residence at that time was a rubber stamp. My guess is many of the French millionaires also moved their assets to Andorra as well and it's not just a place of residence.
Andorra has done a good job to shake off the tax haven title and also become compliant with other EU states without being a member.
Living in Andorra - No More Tax
 
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