URSSAF’s Summer Robbery (and Autumn Reimbursement)

Back in 2016 I wrote my very first article about French taxes. I noted that I had to send two written corrections to the Ministry of Finance by registered mail, asserting (with my French accountant gently nudging me forward) that I, in fact, did not owe taxes to the French on my foreign income. It was only after the second letter (they had tried to get away with simply a reduction in the first reply) that they removed all liability.

Reflecting on that incident now, I remember being surprised that it could have happened. I had only been living in France for about three years at that point. I had the idea that tax returns go into a machine, and that the machine double-checks your own calculations, and then voila, you get your September attestation. This situation turned me on to the idea that sometimes, the machines can screw up, even with something so banal as number-crunching.

Summer 2024 marked a new milestone for me. As is the case for most of my summers in France since 2015, I was away from Paris for the majority of the time. That also meant if “administrative issues” occurred, I probably wouldn’t be able to deal with it until after the rentrée, for various reasons. In this particular case, URSSAF suddenly started pulling out seven times my normal monthly social contribution out of my business bank account.

I say “suddenly” but the truth is that URSSAF sends a “regularization” notice for your social contributions (just as the Ministry of Finance sends one for your personal taxes). The latter normally comes in September but with the new integration of URSSAF with your tax filings, the former came as part of a regular email notice that I ignored. Revenue for my French business had been more or less the same in relation to the previous year so I thought my contributions would remain the same.

Wrong.

For whatever reason, URSSAF had taken my foreign earnings amount, which I have to declare on my French personal return, and decided that all of it was taxable French business income. I only learned that because I sent an email to my personal and business accountants (in September, when I knew everyone would be back) asking what could have happened, and did I miss some new major tax that had been levied on small businesses?

The same accountant who all those years ago helped me stand up to the Ministry of Finance wrote back:

The XXX€ amount represents US source earnings for which you paid social charges in the US. URSSAF should not be using this amount in their calculation.

This happened to one other client and after correspondence with URSSAF by the client’s French accountant, he was able to correct his calculation.

The explanation should be that this is US source income and per the social security tax agreement (Totalization agreement) it is taxed in the US thus exempt from French social charges.

She helpfully enclosed the link for me to share with URSSAF in correspondence.

I duly forwarded my objection to URSSAF and a couple of weeks later I got a new regularization and a large portion of the overcharge refunded to my bank account for the 2023 number. Now that I’ve gotten clarity on what happened, I’m going to restate estimated numbers for 2024 to URSSAF (quite easy since it’s almost the end of 2024), and once they process that, I will probably get the remaining amount of the overcharge refunded.

Two key takeaways:

As doli recently noted in her dogged pursuit of the French to pay her back for the locks they broke, it’s about persistence. Most people, even the French, often cave on personal administrative injustices, as confrontation with the authorities is emotionally draining, and life is hard enough. Stay dogged.
The French bureaucracy is going to make mistakes, even nonsensical ones sometimes. Stay patient and make sure you have good help.

Speaking of good help, for years we have been dogged by the question, “Do you know any good accountants?” My accountant (the one referred to in this story) stopped taking new clients in 2018 so I’ve not been very helpful in recent years other than to send links to some accountants we had found online but had not gotten to know. But thankfully, we now have a resource. You’ll see short interviews done with these firms in the weeks ahead to give you a bit more context. When you reach out to them, let them know The American in Paris sent you. It’s one more way you can support our work. 🙂

If you’d like a laugh from a fellow immigrant, Tatty Macleod, who understands the pain of URSSAF, click here.

Photo by George Becker.

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This story also appeared on Medium.

Mailbag: No, You Can’t Do That

Posted by Stephen Heiner

It’s hard to believe it’s been almost two years since our last mailbag, a series in which I answer questions that don’t necessarily make sense as an article, but provide useful information. Funnily enough, the last mailbag also had a two-year interval. Sometimes you have to wait for the mail to pile up, I guess.

“I’d like to travel around France for a year to decide where to live”

This was brought up in our Facebook group and I had to chuckle at the hopeful naiveté of the poster. This task would be something difficult to pull off even in the United States. Where are you going to get your mail? Where will you file taxes? Where will you bank? How will you get around if you don’t own a car? If you don’t have a French driver’s license, how will you insure your car? Those questions are valid in your home country should you decide to nomad around. Why would they not be relevant in France?

So, let’s be clear, while you might be able to find some crazy way to pull this off, it’s not something I would recommend. For those who are new to France, a prolonged stay at a single location, with plenty of vacations peppered in, is going to help you assimilate to France that much faster. Your language skills will have a chance to bloom in familiar surroundings with potential friends and neighbors and you’ll start to understand the rhythms of daily life in France. I’ve shared before that I was living in Paris for two years before I heard one day in the boulangerie someone ordering their baguette to a certain temperature and finish.

Even if I was dashing around France in a camper van or something similar, changing residence every month, how could I go through the administrative challenges of an OFII visit, which is tied to your address of record? Speaking of which, what address are you going to give the French if you keep changing it every month or quarter? Or to the French bank that you need to have statements from for your renewal? Or how about the renewal itself, which all of us on one-year cards dread until we qualify for a longer-term card and don’t have to go to the annual torture of renewal any more?

What might make more sense is, once a quarter, to spend a month in a different region of France you are considering living in. That allows you to maintain a single residence while getting to know France in an easy and unhurried way.

“I want to come to France as a visitor or Profession Liberale and then get a job”

While I fully understand the logic of this from someone who has never lived in Europe, it’s a thought process that is detached from the realities of the labor market in the European Union.

In short, the EU is a highly protectionist market. When I got a work permit two summers in a row in Switzerland (almost a decade ago now, wow), the process the Swiss followed then has similarities to what is followed in France now:

a detailed job listing has to be created and publicly posted
no one from Switzerland applies for the job, or if they do, it must be demonstrated that they are not sufficiently qualified
even after you are interviewed and found qualified, more time must be allowed to pass, in case anyone Swiss missed the listing
the work permit is issued weeks, not months, before the foreigner’s arrival
the employer must pay a bounty for hiring a foreigner, usually at least five figures for a full-timer, or four figures for a seasonal or part-timer
the employer must pay an additional tax every pay check for hiring a foreigner, as long as you are employed there, usually at least 10% of a paycheck

People used to being able to “find a job” in their industry in their home countries don’t realize just what kind of disadvantage they are at in the EU. The only reason I got the job in Switzerland two summers in a row was because I possessed a skill that no one in Switzerland (at the time) had: expertise in teaching American university entrance exams, specifically the ACT and the SAT.

So, if you are one of the few people trained in a particular field, or type of software, or have a particular security clearance (that would be relevant in the EU), or have NGO-specific experience, or have a particular set of skills a la Liam Neeson, you are not going to get a job here. That doesn’t make you any less of a person, it just means that the protectionist policies of the EU are working effectively, alas to your disadvantage.

Even should you land a job somehow, you won’t be able to keep your visitor or Prof Lib statuses. But thankfully, someone from the legal team of the company hiring you will, in all likelihood, help you apply for a change of status and wind up the previous statues you have.

As a final note, I must stress that a PL visa is not an employment visa. It is a freelancer visa, which allows you to work as an independent contractor, with an established annual income cap. An employment visa allows you to have a job, with no income cap.

“I’d like to count my URSSAF contributions as foreign taxes paid”

For those who don’t know, URSSAF charges are paid by business owners, large and small, to contribute to health care and other expenditures of the French state. They are social charges, not income taxes. Just as Americans don’t get any deductions for paying FICA or unemployment insurance, the French don’t get any credit for paying URSSAF charges, much less credit to a foreign government.

As always, consult your accountant on your business taxes in particular.

TAIP is 100% reader-supported through tipping. If you want to leave us a tip of any amount it would be highly appreciated. These tips help support our efforts to keep TAIP an ad-free environment. Just as at a cafe, the tips are split evenly among the team.

Profession Liberale Visa: Part 2 (90 Days Later)

Posted by Stephen Heiner

Ninety days after you obtain your profession libérale visa, assuming you have done everything correctly after that momentous day at the prefecture, you will have a number of new documents to present to the Prefecture for your follow-up visit.

Chief among those “correctly done things” is a visit to URSSAF within 24-72 hours after you obtain your visa. I went to the office near the BnF right when it opened, and completed my appointment within 20 minutes. I showed her my récipisse designating my new status, as well as answered some basic questions regarding where I lived and which specific classification I was looking for.

URSSAF is in charge of social security contributions, among many other things, and feeds out its information to other agencies, including RSI, INSEE, CIPAV, Ram, and the Ministry of Finance. In turn all these agencies will start flooding your mailbox, asking you to send them follow-up documents. This is a dizzying number of acronyms so let me start with the easy one first, and perhaps the most important.

INSEE is the Institute de la statistique et des études economiques and is responsible for issuing you a national identification number, which you will need now that you are formally entering French society. It’s similar to the American “social security number,” though your French one is oddly longer but easier to decode.

RSI is the Régime Social des Indépendants and is a mutuelle — it’s a subassociation of URSSAF (which, by the way is Unions de Recouvrement des Cotisations de Sécurité Sociale et d’Allocations Familales). Without taking you too far into the woods of unnecessary and redundant and overlapping French agencies, RSI serves as a “mutuelle” for health insurance and pays the difference between what the national health insurance pays and what you owe.

Ram is a partner agency of RSI that works with small business owners and artisans. They are, in my case, responsible for issuing my Carte Vitale, which is what you use to pick up meds at the pharmacie and for all your medical visits.

Finally, there is CIPAV (still with me?) — Caisse Interprofessionelle de prévoyance et d’assurance vieillesse. They are in charge of your pension, and no, you cannot opt out of contributing.

If you end up getting employees (I have absolutely zero intention of doing so, given the draconian anti-business laws in this country) you will also need to know about one of the huge mutuelles, like Malakoff-Mederic, for example, who would handle health care, insurance, and retirement for your employees.

The Ministry of Finance, of course, handles your taxes and they have a very distinctive-looking envelope. As I was writing I turned to a colleague at my coworking space and told her, “Nothing good ever comes in this envelope!” She laughed in agreement. They want to know what space, if any, in your home is going to be dedicated to your work. I maxed that out.

Registering at URSSAF after you obtain your visa will trigger letters from all of these places. Don’t worry, you don’t need to register individually! You’ll also get schedules of future billing — membership ain’t free.

You will also need to bring your first 3-5 invoices from your new professional life, proving you’ve already started working. My agent raised her eyebrows at the four invoices I handed her. “Not bad!” she said in French and smiled. I reminded her that she was the agent who had approved my first long-term visitor renewal, back in 2014. “It’s a long way!” she said. My nod didn’t convey just how much I agreed with her sentiment.

And finally, you’ll need to show them your shiny new French bank account dedicated solely to your new business. If you aren’t well advised, when you go to open one you’ll ask for a professional account and pay all the fees that come with that designation. Both my accountant and my attorney advised me to get a simple personal account and dedicate it to my business, which I did.

I have been extremely satisfied with Société Générale, but by way of auditioning a new bank (and giving myself more options), I opened an account at BNP Paribas. With the recent implementation of FATCA and my US citizenship, this was anything but a smooth ride, but I’ll talk about that in another article.

So bring them most of this documentation (they don’t care about your CIPAV stuff, for example, but as I’ve said in previous posts, bring the second folder with all the “just in case they ask” material), along with “the usual,” i.e. your lease, renter’s insurance, passport, and récipisse.

Your agent at the prefecture will double-check all your paperwork, and then cross-check it with your file from 90 days before.

They will then print another récipisse and have you sign in two boxes in the application for your physical carte. Processing time is about 10 weeks at the moment. I got a July 13th pickup date from an April 21st appointment. And, thankfully I always keep all the paperwork that I’ve ever done for French immigration, as I have to bring the original police report I received when I lost my last card. And I get to pay extra (16€) for losing that card, despite having paid over 100€ to pay for the card in the first place. Remember, this is France, not Germany. 🙂

It’s sinking in. I work in France, legally. I’m on the long road to citizenship which comes with paying taxes here. I know that all these acronyms and agencies can be scary and intimidating, but honestly, it’s also a great filter to separate the dreamers from the doers. Those who want to be here will laugh through this process because a little (or a lot) of paper shouldn’t stand between you and your dreams.

Featured image comes from the Australasian Mine Safety Journal, under creative commons usage.