Retiring to France after Brexit
What changes will UK residents see? We look at residency, healthcare, taxation and the state of the property market
The Leggett Prestige team are fielding many calls from UK buyers who are still keen on retiring to France but want to know what has changed since Brexit.
As a third country national the process is a little more long-winded but a move to France still remains highly attractive both fiscally and in general quality of life.
You will need to apply for a visa before your move. There are many different types, available from your nearest French Embassy in the UK, but you will probably apply for a visa de long séjour valant titre de séjour visiteur, which is for people looking to spend longer than six months in France. There is an excellent visa wizard at www.france-visas.gouv.fr which should be your starting point. Once you have this and have moved across, you will apply for a 5 year carte de séjour, after which you can apply for a carte de séjour permanent. You will apply for these from your local Prefecture.
All residents need Healthcare and you will need to join the French system and get a Carte Vitale. If you are working (employed or self employed) this will happen automatically and you will pay via your cotisations. If you are a pensioner, then you will apply for your Carte Vitale as an S1 holder. If you are an early retiree, or economically inactive, you apply through the Protection Universalle Maladie (PUMa) scheme. Meanwhile, you can use your European Health Insurance Card (EHIC) whilst waiting to join the system, if this expires then you can apply for the new Global Health Insurance Card (GHIC).
If you are not planning to work in France you will need to prove that you have sufficient means to support yourself and not become a burden on the state. The guideline figures are based around the French minimum wage (known as the SMIC) and savings/UK rental income will be taken into account. The figures vary dependent upon situation and size of household but are widely available online.
There are no additional taxes if you are looking to purchase property in France, you should allow around 7% to cover the taxes, searches and Notaires costs (lower if you are buying a newbuild).
The standard Capital Gains Tax (CGT) remains at 19% and, of course, is only payable on a second home. However, the social levy charge for EU residents with a second home in France is 7.5%, be warned that this has risen to 17.2% for British homeowners as they are no longer EU residents.
A taper relief applies on both CGT and the social levy, both kicking in after five years of ownership. CGT reduces to zero after 22 years whilst the social levy reduces to zero after 30 years.
Wealth Tax applies only on real estate assets (the law was changed in 2017, before which it was levied on all assets). This applies to people holding net taxable real estate assets in excess of 1.3M euros.
The next election is due in May 2022.
The current market across France
The latest report from the Notaires de France states that “there had been a strong rebound in terms of post-confinement signings” but that sales volumes stagnated at the end of 2020. Regardless they expect to see 900,000 transactions, which is a remarkably robust figure given the impact of COVID-19 on movement within the country. They go on to say “the price curve has been unaffected by the change in volume….Covid-19 has not lasted long enough to significantly alter attitudes or prices”.
The Leggett Prestige team can confirm that both domestic and international demand remains extremely high, indeed the company posted record sales figures in 2020 and went into 2021 with a sales pipeline 40% higher than 12 months previously. There is a definite shift towards spacious country property, with good broadband and room for a home office. Indeed, we looked at the changing trends in buyer demand in the October 2020 edition of Leggett Prestige Market Comment.
The information above does not constitute financial advice and you should seek specialist advice from an accountant or lawyer where applicable.