French wealth tax: How it affects some UK citizens
The deputy prime minister, Nick Clegg, has suggested it might be a good idea to introduce a wealth tax in the UK.
A few UK citizens already pay such a thing - but in France, where a wealth tax has long been established.
This is a tax not only on wealthy French people, but also on foreigners who have financial interests in that country.
They will be aware that recently the French tax system seems to have been going backwards and forwards more frequently than the Eurostar.
And the latest U-turn on wealth tax may have taken some of them by surprise.
It not only affects those who are resident in France for tax purposes, but also affects those who may be resident anywhere in the world but still have significant wealth located in France.
This second category of people has often escaped the tax in years gone by.
But the French tax authorities have been tightening up on collection recently, and the much-publicised changes to the tax make it more difficult to avoid.
The recent changes
The former French President Nicolas Sarkozy cut the wealth tax for 2012 and beyond.
Then his recently elected replacement, President Francois Hollande, brought the rates for 2012 back to what they had been in 2011.
This has been presented as a one-off "exceptional contribution" to the government's efforts to raise more revenue.
But it seems likely the new rates will remain for the foreseeable future, not least in the light of the general economic background.
When the tax bites
The tax only applies if the value of the assets concerned is above 800,000 euros (£635,000).
Under the Sarkozy plan for 2012, a flat rate of 0.25% was to have been charged on a total value up to three million euros, and a flat 0.5% on a total value above three million euros.
The Hollande rates for 2012 start at 0.55% for wealth valued between 800,000 euros and 1,310,000 euros.
The rates then increase progressively on bands of wealth above that level.
The highest rate is 1.8% for the taxable wealth that exceeds 16,790,000 euros.
For most people affected, the tax will generally already have been paid, or at least set aside, for 2012, on the basis of Sarkozy's reduced rates.
So this extra tax will be an unwelcome surprise, with some people being faced with demands to pay many thousands of euros more than anticipated.
For example, someone with taxable wealth of 2,999,999 euros would have anticipated a tax charge of 7,500 euros, but the charge will now be 15,480 euros, an increase of 7,980 euros.
Location, location, location
For the French tax authorities, the key issue for deciding if you should pay wealth tax is the location of your principal home.
Someone who decides to retire to France and sells their home in the UK would automatically become tax resident in France.
On the other hand, someone who keeps a home in the UK and only spends the summer months in France is not likely to become tax resident there.
If you have more than one home - one in the UK, one in France - then the location of your centre of economic interests is what matters.
It may be that this is, in fact, determined to a greater or lesser extent by the country in which you spend the most time.
However, factors such as the country from which you derive your main income are also key elements in this calculation.
It is important to note that being tax resident in France depends less on the amount of time that is spent in the country, than is the case in the UK.
Weighing up these matters, the French tax authorities may deem you to be tax resident there and thus potentially liable to the wealth tax.
Who has to pay?
UK citizens with no significant wealth in France, who spend a few weeks or even several months holiday in France, will not be taxed.
At the other end of the scale, UK citizens who have moved there will fall fairly and squarely into the grasp of the French tax authorities.
They will be charged the wealth tax if they have enough assets that qualify.
But as I mentioned above, there is another group that needs to be aware of the rules.
People who have significant assets in France, such as properties and money in bank accounts, may still be liable to pay the wealth tax, even if they spend no time there at all.
So another important distinction comes into play.
A French tax resident faces the wealth tax on their worldwide assets.
But someone who is not tax resident in France - but who still has assets there substantial enough to attract the wealth tax - still pays the tax, but only on those assets that are located in France.
What is taxed?
The type of asset most commonly affected is property, including your own home.
But the tax extends to all personal assets, including cash and investments.
Business assets and historic items - for example, most antiques and art collections - are excluded.
Someone who is not tax resident in France is much more likely to be able to mitigate their exposure to the French wealth tax than a French resident.
This is because a non-resident can control what wealth is kept in France, and may even be able reduce the value of taxable assets that cannot be moved elsewhere.
For example, a French holiday home can be mortgaged: whilst the proceeds of the mortgage would also be taxable if they were invested in France, a non-resident can keep the proceeds out of France and so avoid the tax arising on them.
While someone moving to France with no other home will automatically become resident there, there is a special exemption from the wealth tax for the first five years of residence.
Someone who wants to live even exclusively in France for only a few years should therefore be able to escape the wealth tax entirely.
They would likely be subject to French income and other taxes during their time there though.
The opinions expressed are those of the author and are not held by the BBC unless specifically stated. The material is for general information only and does not constitute investment, tax, legal or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Links to external sites are for information only and do not constitute endorsement. Always obtain independent professional advice for your own particular situation.