Freelance translator in USA living abroad
Thread poster: Tradfrances
Tradfrances
Local time: 06:52
French to Spanish
+ ...
Jan 9, 2008

I'm going to sign a contract as translator with a company in USA and I'm living and I'm working in France. For that, I'll be declared as Sole Proprietor in USA. I would like to have information on how to determine my tax obligations and how to report my income to the French tax inspector. I would also like to know whether or not I'm required to reflect VAT tax on my invoices.
Thank you very much in advance.


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xxxLatin_Hellas
United States
Local time: 06:52
Italian to English
+ ...
General Information Jan 9, 2008

You really need to contact both a US and French tax accountant for official advice.

As for the US, assuming that you are a US citizen or US permanent resident, generally speaking, as a sole proprietor abroad, you still must file, specifically a 1040 Schedule C Profit & Loss on Business, and, unless you register with the French public pension system, you must pay US social security tax (self-employment tax) which is roughly 14.13% of your net business income (net of business expenses).

You also have to file the general 1040 form, but you can claim an exemption of your foreign earnings up to around $86,000 I believe. That, combined with many other exemptions and credits, you will probably wind up paying no regular income tax. Nonetheless, as mentioned, unless you join the French public pension system and report that to the US, you will have to pay US social security tax. I suppose that decision will be based on how long you plan to stay in France. Upon retirement, you could conceivably collect social security checks from the two national entities.

These are the general basics, but, again, please contact professional tax accountants for official advice.

Enjoy living in France!


[Edited at 2008-01-09 11:43]

[Edited at 2008-01-09 11:45]

[Edited at 2008-01-09 11:47]

[Edited at 2008-01-09 11:47]


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Tradfrances
Local time: 06:52
French to Spanish
+ ...
TOPIC STARTER
General Information Jan 9, 2008

Thank you very much for your prompt and helpful reply.
Yes, I am registered with the French public pension system, and administration matters are not simple, but fortunately I enjoy living in France.


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xxxLatin_Hellas
United States
Local time: 06:52
Italian to English
+ ...
Pay only French pension tax Jan 9, 2008

Tradfrances wrote:

Thank you very much for your prompt and helpful reply.
Yes, I am registered with the French public pension system, and administration matters are not simple, but fortunately I enjoy living in France.


I believe that the US and France have a double taxation treaty, so you will not have to pay social security tax twice. However, assuming that you are a US citizen, or US permanent resident and you want to maintain your status, you must file in any case, indicating that you are also exempt from social security tax. You will probably need the help of a professional to fill out the returns, at least the first few times. It's a bit of a headache, but probably well worth it if you plan to return to the US one day.

As a resident in France, it appears that you will be fully subject to all French tax rules, for better and for worse (at least you have access to the best health care system in the world), so you really should establish a relationship with a tax accountant there as well.

All the best!


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Daina Jauntirans  Identity Verified
Local time: 23:52
German to English
+ ...
Freelance or employee Jan 9, 2008

What kind of contract are you signing? Freelance or employee? If you're solely working for that company, you're not a sole proprietor - you're an employee and would be paid differently/have different tax obligations.

[Edited at 2008-01-09 13:58]


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Williamson  Identity Verified
United Kingdom
Local time: 05:52
Flemish to English
+ ...
No VAT in the USA Jan 9, 2008

If you are based in France, you export a service to outside the E.U. and that transaction is free of VAT. The USA does not have a VAT-system, only sales-tax.

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Freelance translator in USA living abroad

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