The TIEA with France and the Pension exemption at Article 10: how to obtain it

"Following an exchange of e-mails and a telephone conversation with Edouard Marcus of the DGFIP at Bercy, the French administration have confirmed as follows:

- The Pension exemption applies for fiscal years starting 1st January, 2011.

- It is a norm higher in the constitutional legal structure than the Code Général des Impôts, and, once ratified, is therefore of automatic application and does not require any implementing decree.

- Any Jersey resident, who is ordinarily resident in Jersey, and therefore subject to Jersey tax on the French pension, can therefore obtain an exemption from withholding tax on the pension form the organisme which pays it.

- The exemption should also apply to "contribution sociales", which are now subject to the income tax collection rules; however any demand for reimbursement of these will be dealt with by the DRESG, as separate office charged with the application of article 10 of the TIEA. That issue will be considered on a case by case basis initially as there may still be a hesitancy upon whether the term "income tax" and the TIEA catch all definition at article  3(1)(a) actually covers these contributions now they have been transferred into the income tax collection mechanism and assimilated to it.

Please contact Overseas Chambers for advice on how to obtain a reimbursement where the Pension fund has notwithstanding deducted a withholding tax - it is normal that the withholding be continued until the Jersey resident establishes his or her entitlement, and makes the demand to the Pension provider.

The request for reimbursement is dealt with by a department in the Non-Resident Tax Office, which will apply the principle of the exemption, and reimbursement of sums withheld as it sees appropriate.

The DGFIP is only competent as to principle and not as to its application.

Further information will be available in due course. "