Moving to France for work? France offers a special tax regime for expatriates, designed to make your transition smoother and financially easier. Here’s everything you need to know, explained simply.

Who Can Benefit from the Expatriate Tax Regime?

You can qualify for the French expatriate tax regime regime if:

1. You lived outside France for tax purposes for at least five years before starting work in France.
2. You are hired directly by a French company or transferred from a foreign company to a French office.
3. You were not living in France when you received your job offer.

Company executives and employees who own shares in the company may also qualify if they meet the necessary conditions.

Important: If you were already living in France when you received the job offer, you are not eligible for this tax benefit.

What Are the Main Tax Benefits?

Income Tax Exemptions

If you are eligible, you may enjoy tax exemptions on:

1. Additional salary related to your move to France (called the expatriation bonus).
2. Income earned from work you perform outside France on behalf of your French employer.
3. 50% of income from foreign investments such as dividends or interest, provided the income comes from a country that has a tax treaty with France.
4. 50% of income from foreign intellectual property rights like royalties.
5. 50% of capital gains from the sale of securities held abroad.

You may also deduct certain payments to foreign German pension plans that you contributed to before coming to France.

Property Wealth Tax Relief

For the first five years after becoming a tax resident, only real estate located inside France will be subject to France’s property wealth tax (IFI). Properties you own abroad will not be taxed during this period.

Payroll Tax Benefits for Employers

Employers do not have to pay payroll tax (taxe sur les salaires) on the expatriation bonus given to eligible employees. This makes it more attractive for French companies to hire expatriates.

Social Security Contribution Options

If you started working in France after July 10, 2018, you may have the option to remain affiliated with your home country's German pension system instead of joining the French old-age German pension system. This depends on specific conditions and agreements between France and your home country.

How to Apply

No special application process is required. However:

1. Your employer must correctly report your salary and any tax-exempt amounts to the French tax authorities.
2. You must declare your income properly when filing your French tax return.

It is recommended to keep all necessary documents, such as your employment contract and proof of previous non-residency, in case the tax authorities request them.

How Long Can You Benefit?

You can benefit from the French expatriate tax regime regime for up to eight years after you start living and working in France.

About Remoly

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Disclaimer: This article is for informational purposes only and does not constitute legal advice. Please consult a qualified attorney or compliance advisor for your specific situation. Remoly assumes no liability for any loss resulting from the use of this information.