The Court of Justice of the European Union ruled against France concerning the CSG and CRDS levy on income from the assets of non-resident taxpayers, both French and foreign. They may demand reimbursement within two years after payment of social security contributions.
France does not have the right to charge social security contributions to persons not benefiting from social security. The European Court of Justice (ECJ) delivered a ruling to this effect on Thursday 26 February 2015. The judicial authority ruled that France is not entitled to deduct CSG and CRDS from the income of non-resident taxpayers domiciled in France. More specifically, the Court ruled in favour of France against a Dutch national working in the Netherlands but domiciled in France to whom it applied social security contributions on life annuities concluded in the Netherlands.
According to European case law, a taxpayer does not have to pay social contributions from several countries on these incomes. In other words, it is only accountable to one social security system: in practical terms, a French frontier worker working in Germany whose income is already subject to social security contributions in the United Kingdom does not have to pay French social security contributions. A ban which has been in force for income from employment and replacement (salaries, retirement pensions, allowances, etc.) since 2000 and which now officially applies to income from property assets (land income, interest on a life insurance policy, etc.).
REIMBURSEMENT AND PRESCRIPTION
The conflict decided by the ECJ dates back to the summer of 2012. The first finance law of François Hollande's mandate introduced the application of social security contributions at 15.5% on the property income of non-residents and their real estate capital gains. The measure has since been strongly contested, notably by wealth management professionals and Frédéric Lefebvre, UMP deputy for French expatriates in North America.
As a consequence of the judgment handed down by the Luxembourg court, taxpayers who have had to pay social security contributions since the measure came into force may demand reimbursement. However, a two-year limitation period applies to claims. It runs from the date of payment of social security contributions. In fact, some taxpayers are no longer able to obtain compensation: a request for reimbursement had to be made before December 31,2014 for the real estate capital gains realized in 2013. Conversely, social security contributions on land income received in 2012 and taxed in 2013 can still be reimbursed. In this case, the request must be made before 31 December 2015.
Our office assists you with complaints in order to guarantee your reimbursement.