Tax officials in France have clarified their stance on double taxation, revoking earlier suggestions that British expats could end up being taxed twice on UK-generated income such as pensions and rental earnings, but confusion continues over the rules on any income below the UK personal tax threshold.

Krish Soopramanien, tax partner at RSM Tenon, said: 'This is a fair and welcome decision and in line with the spirit of the double taxation agreement between the UK and France. However there is still confusion for those expats whose UK income falls below the UK personal allowance which may potentially be taxed in France.'

A slight change in the rules governing the double-tax agreement between the two countries last year opened the way for some French tax offices to suggest they could charge tax and social security contributions on the UK-generated income.

The recent clarification from the Direction Generale des Finances Publiques makes clear that income from property rental or pensions derived from UK sources which has been taxed will be exempt from further taxation.

However, doubt still remains over the position of income received by British expats which falls below the personal allowance threshold and so is not subject to tax in the UK. Expats in France have to file a tax return based on their worldwide income, with credits given for tax paid in another country which has signed the double taxation agreement, which can be set against any French tax charges. However, if the UK income has not been taxed then no credit is available.

Soopramanien said this particular point would require further clarification still, particularly as individual French tax offices were interpreting requirements in different ways which was giving rise to some disparity and confusion.