French Taxation for Expats Living in France (2025)

1) When are you tax-resident in France?

You’re treated as French tax-resident if any one of these is true: your main home (foyer) is in France; you spend most of the year here; your principal professional activity is here; or your centre of economic interests is here. If one test fits, you’re resident for French income tax on worldwide income.

2) How French income tax works

• Household unit & “parts”: France taxes the household (foyer fiscal) using the quotient familial—your taxable income is divided by a number of “parts” (marital status, dependants), then the progressive scale is applied. The top marginal rate is 45%. Brackets are re-indexed each year.

• Pay-as-you-earn (prélèvement à la source, PAS): Tax is withheld from salaries and pensions during the year and reconciled when you file in spring. From 1 September 2025, married/civil-partnered couples are placed by default on an individualised PAS rate (each spouse pays a rate reflecting their own income). You can opt back to a single household rate.

3) What income is taxed—and at what rates?

Salaries & self-employment

• Salaries are taxed at the progressive scale after a standard 10% deduction (or you can elect actual expenses).

• Self-employed income is taxed as BIC/BNC (trader/professional), either with actual expenses or via a simplified “micro” regime depending on turnover (ask your accountant which regime fits you).

Pensions

• Foreign pensions received by a French resident are generally taxable in France (treaty may assign the taxing right to France), with a 10% pension allowance (subject to an annual cap).

• Social contributions on pensions (CSG/CRDS/CASA) depend on your household income and affiliation to the French system; some pensioners are partially or fully exempt based on means or social-security status.

Investment income (interest, dividends, capital gains on shares/funds)

• Default is the flat tax (PFU) at 30% = 12.8% income tax + 17.2% social charges. You can opt for the progressive scale instead if that’s better for you.

• For those affiliated to another EU/EEA/Swiss social-security system (e.g., certain S1 holders), the CSG/CRDS may not apply on investment income; instead a 7.5% solidarity levy often applies—documentation required.

Real-estate income & gains

• Rental income is taxable in France; unfurnished (foncier) and furnished (BIC) are treated differently (real vs micro regimes).

• Sale of French property: taxable 19% capital-gains tax + 17.2% social charges, with an additional 2–6% surtax on large gains; time-based abatements can reduce/erase the tax after long holding periods. Your main home is usually exempt.

4) Social charges (prélèvements sociaux)

In addition to income tax, most passive income attracts 17.2% in social charges (breakdown includes CSG 9.2%, CRDS 0.5%, etc.). Part of the CSG can be deductible from next year’s taxable income. Special rules and reduced rates/exemptions exist for certain non-residents and EU-affiliated residents.

5) Local property taxes

• Taxe foncière: paid annually by owners/usufruct holders (due if you own property on 1 January). Amount varies by commune; some reliefs exist.

• Taxe d’habitation: abolished for principal residences since 2023, but still due on second homes, and many communes now apply surcharges in tense areas.

6) Wealth tax (IFI)

France has no general net-worth tax, but there is IFI on real-estate wealth: if your net real-estate assets exceed €1.3m on 1 January, a progressive IFI scale applies (with specific deductions, reliefs and caps).

7) Foreign-asset reporting (major expat “gotchas”)

Alongside your annual return, residents must declare:

• Foreign bank/brokerage accounts and life-insurance/capitalisation policies held outside France—Form 3916/3916-bis (millésime 2025). Non-compliance can trigger per-account penalties.

• Crypto/digital-asset exchange accounts held abroad—report via 3916-bis.

• Trusts with a French connection (settlor/beneficiary resident or French-situs assets): event-driven TRUST-1and annual TRUST-2 filings to the Non-Residents Tax Office.

• Property occupancy declaration: manage your properties in “Gérer mes biens immobiliers” in your impots.gouv.fr space; the declaration can be updated year-round.

8) Double-tax treaties (eliminating double taxation)

France has an extensive treaty network that allocates taxing rights and avoids double taxation—either by exemption with progression or foreign tax credits. Example: the France–UK treaty generally taxes private pensions in the state of residence (i.e., France, if you live here). Always check your specific treaty article.

9) Inheritances & gifts

France taxes inheritances and gifts based on the relationship to the donor/deceased, with allowances and progressive bands (lineal heirs benefit from larger allowances; distant relatives/third parties can face 60% rate above small allowances). Civil-law and cross-border rules (habitual residence of deceased/heir; French assets) can bring non-French estates into scope.

10) Key dates (2025 campaign for 2024 income)

• Online filing opened 10 April 2025, with staged deadlines by department ending 5 June 2025. Paper filers had 20 May 2025. (Each year’s calendar is announced in spring—check the official schedule.)

Quick start checklist for your first tax year in France

1. Create your impots.gouv.fr account and set/confirm your PAS rate. From Sept-2025, couples are on individualised rates by default (you can opt for a single household rate).

2. List your worldwide income (employment, pensions, investments, rentals) and choose PFU vs barème for investment income.

3. Declare foreign accounts/policies (3916/3916-bis) and any crypto exchange accounts.

4. Check local taxes on any property you own (foncière; habitation for second homes).

5. Assess IFI exposure if your net real-estate wealth exceeds €1.3m.

6. Review treaty position for foreign pensions/interest/dividends and how relief is granted (exemption vs credit).

   
   

Common pitfalls for expats

• Forgetting to report foreign bank/crypto accounts (3916/3916-bis).

• Assuming your old country keeps taxing a pension: treaty rules often move private-pension taxation to France once you’re resident.

• Missing the social-charges angle on investments (standard 17.2% vs 7.5% solidarity levy if EU/EEA-affiliated).

• Not adjusting your PAS rate after big income changes (pay rise, retirement, rental start-up); you can update it online anytime.