A couple wrongly assessed for social charges obtain redress in their complaint to the French tax authorities.

Regular readers will be aware that over the past year or so we have been running something of a campaign over the number of retired expats in France who are being wrongly assessed for the payment of the social charges*.

As a result of the publicity we have given to this issue, with our assistance, an increasing number of you have made successful claims to the French tax authority for reimbursement of the sums which you have wrongly been charged.

The latest couple to have been vindicated in their claim are Ann and Alain Bibb, who live in Agde, in the Hérault department of Languedoc-Roussillon.

They have been fighting a battle with their local tax office over the payment of one of social charges, the Contribution au Remboursement de la Dette Sociale (CRDS), on their retirement pension for the past six months.

The tax office was adamant in asserting that they were liable for the tax, despite the couple having produced their UK issued E121 certificate of entitlement to health care in France. The tax authority in Beziers even threatened to sequester their bank account due to the non-payment of the tax.

In fact, none of the social charges (prélèvement sociaux) are payable on the retirement pensions of those of retirement age from the EU by virtue of the fact that their health cover is arranged through an E121/S1.

Indeed, early retirees are also exempt on their pension income if they hold health cover through an E101/S1.

Nevertheless, many local tax offices in France are not aware of the right of exemption of those on an E/S form, as a result of which they impose the charges.

Tax offices frequently assume that because expats health insurance cover is administered through the local health authority (CPAM) they are affiliated to the French health system.

In fact, the CPAM merely act as agents in the administration of the E/S forms, in the same way the health authorities in the UK and other EU states act as agents for French nationals on an E form living in another EU country.

Accordingly, as with other readers who sought our assistance on this issue we provided the advice to Ann and Alain which enabled them to take their case to the Conciliateur Fiscal, the ombudsman for tax matters in France. Each department of France has its own Conciliateur Fiscal.

Last month they received a letter from their Conciliateur Fiscal stating confirming that they had been wrongly assessed and that they would be given a full refund of the CRDS they had paid in 2009.

The Conciliateur Fiscal drew attention to the need for the couple to produce to the tax office suitable evidence of their exemption from the tax. It seems in this case the E121 they produced was not enough.

However, he was finally persuaded by sight of their health card, their Carte Vitale, which stated on it ‘hospitalisation et soins externes hors budget global’, which it seems was enough to convince him that they were indeed exempt from any social charges on their pension.

* The ‘social charges’ are known as the prélèvement sociaux, comprising three different taxes:

• Contribution Sociale Généralisée (CSG)
• Contribution au Remboursement de la Dette Sociale (CRDS)
• Prélèvement Social (PS)