Changes to Wealth Tax in France and Spain
In 2018, the law on Wealth Tax in France changed. Wealth Tax is now only payable on real estate and not on worldwide assets above €1,300,000 as was the case with the previous general Wealth Tax in France. Real estate owned and used by a company for its business is outside the scope of the tax.
For the purposes of French Wealth Tax, if you are French resident, the whole of your worldwide real estate assets are considered, and if you are non-French resident then only your real estate assets in France are considered.
The deadline to file your 2019 Wealth Tax return is fast approaching, although the exact date has still not been confirmed by the French tax authorities. It is predicted that the deadline for filing the return for non-French tax residents will be 16 May 2019 and for French tax residents will be 21 May 2019.
In Spain, a Constitutional Court has ruled that Catalonia’s new Wealth Tax on non-productive assets held by corporate bodies is not illegal. The new tax would charge companies on certain assets which were not being used for the business’s purposes and which were located in Catalonia. These assets include real estate, cars, art, jewellery, boats and planes.
The Catalonian Government is yet to pass enabling regulations to bring the tax into effect.
Top Tip: If you have assets in France or Spain and think you might be affected by Wealth Tax consult a tax expert.
For advice on Tax matters, please contactour International and Cross Border Tax team.