Financial update September 2024 – France

I hope you all had a good summer. I very much appreciated the fact that it wasn’t too hot over the summer. My garden is certainly in a better shape thanks to the better weather. Now it is back to school and back to work and I am looking forward to setting up appointments and meeting people again.

For those who are eligible for the energy cheque but did not receive it this spring or if you did receive it but would like to review the amount received, you can now make a claim on the website chequeenergie.gouv.fr but you must make sure you do this before 31st December 2025.

On 1st August the interest rate of the LEP savings account reduced to 4%. To be able to open one of these accounts your taxable income needs to be below €22 419 (single person) or €34 393 for a couple. This rate reduction puts the LEP at only 1% higher than the other savings accounts such as the Livret A, the LDDS and the Livret Jeune which have an interest rate of 3%, set rate until February 2025.

If you are looking to save for your children there is a new savings plan called the Plan Epargne Avenue Climate (PEAC) which is available from 1st July 2024. It is a hybrid of the Livret A and the PER retirement scheme and allows you to save up to €22,950 with any gains being free of tax and social charges. There is no fixed interest rate, any gains will depend on the investment strategy but the investments are ESG and in “green” bonds. However not many banks or insurance companies offer this savings plan as yet preferring their own versions of assurance vies.

Since 31st July and until 4th December, those taxpayers who declared their income online can correct their declaration or amend any omissions by going onto their personal account on the impots.gouv.fr website under “accéder à la correction en ligne”. However, bear in mind that if the amendment results in less tax being paid or a higher tax credit, the tax office will probably contact you for more information or documents and can refuse to amend the tax return. If they do this, you need to make a complaint via the messenger service and, if this is refused, court action will be necessary. This comes from a decision of Paris administrative court of appeal of 28th June 2024 (no 22PA04610) whereby the the Court ordered the tax office to reissue the tax statement will the requested amendments. The online correction system does not let people know that their amendments can be refused.

As from September, if the amount of tax you pay is greater or less than the previous year, your monthly payments will change from 15th September. If you owe less or the equivalent to €300, the remainder will be taken on that date. If you owe more than €300, the payment will be spread out over four payments taken on 26th September, 25th October, 25th November and 27th December.

For those with Pru assurance vies or those thinking of investing in a Pru Assurance Vie, on Tuesday 27th August 2024 the Prudential Assurance Company (PAC) board reviewed the Prufund Expected Growth Rates (EGR) as part of the quarterly review process. Prufund aims to help customers grow money over the medium to long term ( 5 to 10 years) and it protects customers from some of the short-term ups and downs of the markets by using the unique established smoothing process. The Expected Growth Rate (EGR) is the forward looking element of the Prufund smoothing process. For this quarter the EGRs of the Prufunds in our assurance vie products remained unchanged for the € and $ but the Prufund Growth GBP dropped slightly from 7.7% to 7.3% and the PruFund Cautious GBP dropped from 7% to 6.6%. The Unit Price Adjustment (UPA) part of the smoothing process, which is a backward looking element, and which is formulaic and non-discretionary are also reviewed quarterly. This quarter there was an upward UPA for the Prufund Growth USD fund of +2.19%.

September is really the beginning of the year in France, more so than January, after the long summer holidays. Referrals are very important in our business and so is our reputation with clients. Therefore we are asking clients to kindly give a review of our advisers and our business on Trustpilot. I would be very grateful if you would kindly take the time to leave a comment using the link below: https://uk.trustpilot.com/review/spectrum-ifa.com

Please do get in touch to arrange a free, no obligation phone call or video meeting to discuss any financial or tax matters that you may need advice on. I look forward to hearing from you.