Foreign Perspectives

Archive for the ‘Local Administration’ Category

Standing apart from the system these days we’ve not noticed first hand all of the chaos that has resulted in some of the reorganisations of UK government departments over the last year or two but can only laugh at some of it from afar.

Perhaps the best example is the Child “Tax Credit” and Child Benefit combination.

For political reasons, the Child Tax Credit is called a tax credit although, in all but name, it’s clearly a benefit payment. You claim it exactly like a benefit and it’s paid exactly like a benefit so it’s only the name that differentiates it. And that’s the problem: seeing as it’s been called a “tax credit” then it can’t be integrated with the Child Benefit systems thus saving a fortune on duplication of administrations and reducing the errors being made in payments.

That’s a recent one of course but the National Insurance Contributions have long been separate from Income Tax. The bands at which both are levied have been aligned for quite a while now so there’s no reason to keep them separate other than the political double-speak that called the National Insurance scheme an insurance scheme when in fact it’s merely another tax. If it were an insurance scheme then it would build up some money in the kitty but, of course, it doesn’t as the money is paid out as it comes in.

So when will common sense prevail and such nonsenses be put to an end? Somehow I can’t see it being anytime soon as there are just too many interested parties who it suits to have the current system perpetuated.

Once we get into the summer season, there’s really no chance of us keeping up with anything that isn’t essential to the day to day running of the place and one of those “non-essential” things is keeping the accounts up to date.

It’s not that we’ve no idea what money is coming in and going out as we go along, just that the formal accounts don’t get kept up to date over the summer period. This year is particularly bad as there was a lot of additional work needing doing with our UK side of the business and so it’s really only now that we’re getting settled down to get the finances up to date.

Naturally, that long period since the relevant transactions makes life more difficult as it’s that much easier to lose the odd document along the way of course and getting the whole lot into a sensible sequence takes a whole lot longer than it would do if we were keeping up to date as we went along.

Having said that, overall it seems to take us a lot less time to do when we do the whole lot in bulk. This morning we went through the majority of the receipts over a couple of hours for instance whereas doing it a little bit at a time would consume a lot more time when you added it all up. In fact the biggest downside is that the whole thing feels much more like a chore when you’ve a big heap of documentations to work through than when you’ve only a couple of bills to mark off.

Fingers crossed, we’ll have tidied it all up by next week and then it’s off to the accountant with it.

When we kicked off with the French taxation system we were constantly getting letters saying that we hadn’t paid this or that in time. Most of the time the initial demand for the money arrived in the same post that the reminder did and frequently the initial demand arrived a week after the reminder.

So, we started moving some things onto direct debit. Major mistake.

Even if you tell the authorities that their calculations are in error, they just collect on the direct debit. So, this year when they have calculated that we made EUR 155,000 the direct debits are a major joke. You’d think that the bank wouldn’t pay out on a direct debit that was going to put you thousands into the red but that’s not the case.

Anyway, we’re off to the bank tomorrow to attempt to cancel several of them. At least with the cheques we knew that they couldn’t take the money out.

Of course, that’ll no doubt require an appointment with our “banking counsellor” which might mean a delay of some weeks.

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.

The whole idea behind the common market, or European Union as we call it these days, was that borders between the countries participating would gradually cease to exist and, for the most part, that has been gradually happening over the last 20 or 30 years. How come then there’s almost always a queue at the border crossing between Spain and France then?

I used to think that it was just a case of “jobs for the boys” until I saw a number of cars and caravans being pretty much taken apart by the customs guys. Presumably they’re enforcing some import control then? Perhaps, but then anything that you can legally buy in Spain can be legally taken to France.

Whatever they’re doing it certainly causes major problems in the Summer when the queues of cars can reach right back to the toll booth (abour 6 kilometres!) and the hill leading up to the customs post is littered with cars that have overheated and had to pull in off the road.