November 29, 2017
Repayment of Social Contributions Paid by Non-Residents: A New Window Open
Recently, a French first-degree administrative court reopened the debate on the imposition of social contributions to non-resident individuals with French source property income or gains (Administrative Tribunal of Strasbourg; July 11, 2017).
Invalidating a previous European court of justice decision confirming the impossibility to claim social contributions from non-residents not affiliated to French social security schemes, the French parliament changed the budget allocation of these contributions in order to disconnect them from the direct financing of social insurance schemes, with the aim of maintaining its payment by non-residents even if not subject to French social security regime.
Since 2016, these contributions were then still claimed on French source property income and gains attributable to non-French residents.
The Administrative Court of Strasbourg ruled that notwithstanding these changes and because of the remaining links between these contributions and the French social security regime, the European treaties still prevent from imposing these contributions to non-resident individuals persons who are not subject to French social security regime.
Accordingly, European Union and Swiss citizens subject to social security regime in another EU Member State or in Switzerland have good arguments for claiming the repayment of the social contributions paid on French source property income or gains in the last two years.