Have Tax Questions? Ask a Tax Expert for Answers ASAP
I do indeed want to offset French tax against the UK tax liability on French income which is taxable in the UK. The problem is that because the French tax year is a calendar year, the UK tax and the French tax are paid in different tax years.
When I have claimed relief for foreign tax paid on foreign income against the UK tax liability on the same income for a client, I take the actual foreign tax liability on the foreign income for the foreign tax year which ends in the UK tax year that you want to claim relief against.For example, I would disclose the French income for the year end 31 December 2014 in the UK tax return for the year ended 5 April 2015 and claim the French tax paid on that income against my UK tax liabilty on that income for 2014/15, regardless of when the French tax is actually paid. I used to do this frequently with clients who had US dividends and it became accepted practise as the US companies provided a certificate of the income and US tax withheld for the calendar year.
As you have discovered, you cannot offset foreign tax against a UK tax liability where there is no foreign income.
That doesn't work for French income; you can't even submit a French tax declaration for 2014 until June 2015. So you would have to lie on your 2014/5 UK tax return, claiming that you had paid French tax when you hadn't.