Foreign Perspectives

Archive for the ‘Places’ Category

One noticeable difference in the bookings this year is that we’ve had a lot more Americans staying with us.

Americans, in general, only get two weeks vacation time each year which obviously has quite an impact on the type of holiday that they take. For one thing, it’s rare for a working American to take a holiday longer than two weeks and therefore they are, for the most part, channelled into taking package holidays as that’s the only way you can really pack a lot of sightseeing into a short period. Moreover that short period means that they tend to concentrate on the highlights of a country or group of countries (“doing” Europe is quite common) so typically they will consider that they’ve “done” France if they’ve been to Paris.

Therefore, normally, the long-stay Americans are either students on a back-packing type holiday to Europe or retired people. However, it’s been noticeably different this year and we’ve had both more Americans and more varied categories of Americans staying with us. The couple who have just left us today were normal working Americans for instance and moreover they are planning to return as they were both quite taken with the region (and us!).

There’s something of a growth market in mortgage and loan quotation services at the moment both in America and here in the UK.

That’s indicative of quite a lot of shifting around in the interest rates and deals available so even if you’re not actively considering home loans, it’s a good time to have a quick look. Mortgages are usually by far the largest single expense and therefore even quite a small percentage reduction in the payments can have quite a large effect on your lifestyle. Something as small as 1% of a difference soon adds up: much better to have that money in your pocket than the banks for sure!

Loans are another flavour of the month thing too with Christmas being so close (one month and 10 days to go!). Rather than dump the whole lot on the credit cards, it’s probably better to put some thought into it as it’s easy to save quite a bit with some of the current deals (from 4.9%!).

One of the chief characteristics of French tax and social security administration is that when you start out in business they send you bills based on an estimate of what an established business would be earning, not what a start-up would be bringing in.

Although typically a new business will earn very little after start-up expenses in its first year, it will typically receive bills for thousands of euros no matter how small it might be. Clearly that’s something of a drag on start-ups in France and the effect is that considerable chunks of business activity are done on the black ie without registration. This, of course, helps nobody in that the businesses which do register have to shoulder the tax burden for those that don’t which forces many down the unregistered route or alternatively into bankrupcy, neither of which is beneficial for the country.

Take for instance Marcus who’s done some calculations as to what tax a start-up could expect to be paying in the first couple of years. His example was of a business making EUR 5000 per year right from the start and includes just the social security contributions (ie there would be addition taxes). Year one bill: EUR 4914, year two 2780, year three 2183 ie over 98% tax on the first years income.

Even if you change the parameters of the calculations to reflect zero income in the first two years followed by EUR 5000, the bill for the second year is EUR 4080! Still, at least in the third year you get a refund of EUR 281 in that case, which you could put towards the wind-up costs of your business.

Is it any wonder why the black economy in France is so large?

We’ve just received yet another ludicrous bill from one of the French tax offices.

Apparently since we didn’t return the 2005 figures for the business until a few weeks ago and haven’t yet returned the 2006 figures (both thanks to our duff accountants), we must obviously have earned EUR 155,000 in 2006 and therefore they are taxing us on the basis of that. Since 2005 was our first full year with the business we were still investing substantial sums and therefore didn’t make any money at all in 2005 and it’s only in 2006 that things started heading towards a more normal level. Sadly, still a long way short of EUR 155,000 though.

As in all areas, they are incredibly optimistic about the performance of the French post office too and seem to believe that a letter which they printed on October 31st would be delivered within two days even though they didn’t even post it until the 6th of November!

Anyway, we’ll have yet another go at rattling the cage of our accountants to see if they can head off the attempt to collect on one of the largest direct debits I’ve seen (which’ll bounce anyway as the sum involved is actually more than our total income for the year!). Still, at least that should give me the opportunity to change back to paying them by cheque: it’s never a good move to pay any French tax place by direct debit as we’ve found.

James started in the local nursery school in September last year as the only non-French child.

When you look at any of the “moving to France” TV series, no matter what the age, the kids are put into the local school and are fluent in about three months. Over a year down the line, James uses single french words now and again but never a complete phrase. How come?

Ironically, I think it’s an aspect of them being helpful from the start in putting him in a class with the teacher who speaks a little english (they’ve even moved her up to the next class with him). The effect of that was that the children started speaking english which, of course, meant that he didn’t need to speak any french, so he didn’t.

Unfortunately, that’s going to mean that next year they will surely refuse him entry to the primary school and instead will insist that he goes to the CIPPA class in Perpignan. That’s simply not viable as you could hardly expect a six year old to negotiate two buses plus cross a very busy road by himself and besides it’s a class for 16 to 18 year olds who already speak french.

All this, of course, creates something of a problem for us as from September next year.