Q&A

Dominic Coyle answers your questions

Making tax return on French income

We own property in France, which we let on a short-term basis and need to make tax returns in France. I have been trying, unsuccessfully, to source an accountant in Ireland who can make these returns for us.

I have details of an accountant in France who would deal with this for us, but I would prefer to deal locally with a qualified person.

Do you know the name of anyone in Dublin who does this type of work?

Ms T.T., e-mail

As you say, you will need to make a French tax return on income from letting your property in France.

While most people will be happy to sort such matters out through a French accountant - and there is a certain logic of dealing through people who are intimately familiar with the local tax system - there is no obligation to do so.

Getting someone over here who is professionally qualified and familiar with the French regime is a challenge. The French tax system is seen as particularly complex - even within continental Europe - with national and local taxes possibly involved, depending on the location of your property.

One name that has been mentioned to me is Grant Thornton partner Bernard Doherty.

There are times when working through a larger company can have drawbacks, but this is a classic case of when it is an asset.

Not only is Mr Doherty very familiar with the French tax regime, but the practice also has offices in France.

Grant Thornton's number in Dublin is 01-6805805.

Calculating PRSI liabilities

I would be most grateful if you could help me find out some information on PRSI. I have been unable to get this information as I can't seem to get any answer at the helpline in the Department of Finance, which always seems to be engaged.

I am a 58-year-old teacher working in the VEC system and intend taking early retirement this summer. I am a widower and am presently paying PRSI at class D2, which means that I don't pay the health levy of 2 per cent.

When I retire, should I be paying any PRSI at all, seeing as I'm not liable for the health levy. If I do have to pay, at what rate will it be calculated?

Also what happens when I reach 66? Will I be entirely exempt from any contributions at that stage?

Mr R.O'B., Wexford

My understanding is that you are unlikely to be facing any PRSI liability when you retire.

In normal circumstances, a retired teacher would be on an occupational pension that is likely to be more than €440 a week and would therefore come under PRSI class K1 - which would leave you subject to a 2 per cent charge.

However, your current status as PRSI class D2 - rather than D1 on which one would expect to find a person in your occupation and earnings - indicates that you must be in receipt of a medical card, a one-parent family payment or, more likely in your case, a social welfare widower's pension.

That being the case, you will transfer to Class M once you retire and that will see you facing no PRSI liability - or exposure to the health levy.

As you will already be exempt from any contributions, there will be no change when you reach 66.

Transferring pension savings

I am 59 and am going to a job that has no pension scheme. I have a deferred pension based on nearly 32 years' service with a previous employer, plus five years added in a redundancy deal.

Also, I have four years of pension credits with my current employer - 5 per cent of salary from the employer and 5 per cent from the employee.

Assuming retirement at 65, is it worth my while taking out a PRSA? Should I cash in the pension fund with my current employer and buy a bond or equities, or would it be better to defer collecting that pension until I am 65?

Mr P.M., Dublin

You seem better prepared for retirement, when that eventually comes, than most people in the private sector on the basis of the information outlined.

As I understand it, you have a defined-benefit pension amounting to 37 years (32 years worked plus the five years added under the redundancy deal).

You also have a defined contribution pension scheme for the past four years.

Should you open a PRSA? If your new employer does not provide an occupational pension plan, you should - your employer is obliged to offer that facility at least, regardless of whether they contribute, although you can choose to open one elsewhere.

With one significant deferred pension already, my suggestion would be to look at transferring the four years' contributions to that PRSA if possible or examine the possibilities and investment flexibility of a buyout bond.

Please send your queries to Dominic Coyle, Q&A, The Irish Times, D'Olier Street, Dublin 2 or e-mail to dcoyle@irish-times.ie. This column is a reader service and is not intended to replace professional advice.

Due to the volume of mail, there may be a delay in answering queries. All suitable queries will be answered through the columns of the newspaper. No personal correspondence will be entered into.