You just got the job you’ve been dreaming of for years, the only problem, you’re going to have to change your place of work and leave… abroad on a long-term mission! You will join the large expatriate family for a few years or for your whole life. What about the tax system, social security, retirement or unemployment insurance for expatriates? Before you pack your bags, sign the lease of your new accommodation and arrange your relocation: you are told everything about expat status.
When is you considered an expatriate?
When an employee goes to work in a foreign country on a long mission,at least 3 months, he is considered an expatriate employee. Its professional activity can be done on behalf of a French company abroad, for a local company, or independently. Unlike the seconded worker, as long as theexpatriate goes to work abroad, he is no longer covered by French social protection.
Occupational mobility is perceived by employees as a real professional opportunity, but also a personal one. Indeed, for French employees, mobility is also synonymous with more well-being at work. While expatriation has manyinterests, which often means hierarchical evolution, wages, access to a better standard of living but also more development at work, it also means having to give up certain advantages of one’s country of origin. Leaving France in particular, we leave behind a complete and reassuring social coverage.
What about tax for expatriates?
Where should the expatriate pay his taxes? To find out, you have to look at the country of tax residence of the mobility employee. According to the French administration, there are several criteria for determining it. Tax residence is the place where the expatriate – and his family if she also resides there – stays most of the year. He must live there at least 183 days a year and this place must also be that of the main activity of the expatriate to which he devotes most of his time. However, it does not have to be the most lucrative activity.
In determining an expatriate’s tax residence, it is also necessary to take into account the country in which the employee receives most of his income in general, whether they are professional or real estate for example. If the expatriate’s home, source and source of income are located in France, the expatriate will be domiciled in France. In the event that the employee has gone abroad alone and returns to see his family in France, he will probably remain a French tax resident.
Note: France has established tax treaties with many foreign countries to avoid double taxation. Find the list of these countries and all the details on the website impots.gouv.fr. In some countries where taxes are lower, it may of course be advantageous to establish your tax residence there. Discover the best countries for expats and what makes them particularly attractive.
What health coverage for expats?
By moving abroad, the employee will no longer depend on French social security and will have to be affiliated with the social protection of the country where he works. The expat’s family will also depend on the social security coverage of the foreign country, regardless of whether they live there or not. However, the new country’s health insurance plan may be less comprehensive and require membership in other organizations.
Joining the CFE: expat social security.
In addition to contributing to the compulsory scheme of his new country of residence, the expatriate can choose to continue to contribute in France by joining the Caisse des Français de l’étranger (CFE). It allows to be protected during his expatriation but also anywhere in the world – France included therefore – and to be reimbursed for his medical expenses on the same basis as the French social security. Upon her return from expatriation, she automatically re-enters the general French social security system.
Contracting international health insurance “at the first euro”
Signing up for complementary health care can be essential in many countries to cover the rest of the burden, especially in those where health care costs are extremely expensive. Particularly recommended for expatriates, international health insurance “at the first euro” allows to be reimbursed from the first euro spent and up to a certain ceiling depending on the contract signed.
What pension scheme for expatriates?
Theexpatriate depends on the pension insurance plan of the country in which he works. In the context of an expatriation to Europe, all periods worked in a member country of the European Union or the European Economic Area are taken into account when calculating the employee’s retirement. For an expatriation outside the European Union, if no agreement has been signed with France, the rights acquired in France are lost. To avoid this situation, it is simply enough to adhere to the voluntary old-age insurance of the CFE which allows to continue to contribute for his retirement in France. Once retired, the expatriate employee will receive a pension from each of the countries in which he has worked.
What rights to unemployment insurance as an expatriate?
If they lose their jobs, in order to be compensated, expatriate employees in a Member Country of the European Union are attached to the country’s local unemployment insurance fund. Each has its own legislation on the conditions, duration and levels of compensation in force. In a country outside the European Union, if the employee’s company is based in France, the expatriate will depend on French unemployment insurance, namely Pôle Emploi. If this is not the case, affiliation with unemployment insurance is optional. To benefit, it is possible to take out unemployment insurance from a local or international insurer.