One of the most common questions that crops up every year is, “Do expats pay taxes in France?”
For most Americans living in France, the answer will likely be yes.
But, it’s not necessarily intuitive as to why that’s the case.
To understand why expats pay taxes in France if they live in France, Americans need to understand how the US taxation system works. Then, they need to understand how France’s taxation system works. And then, because when you’re an expat, everything is at least a little harder, and some things, (like taxes), a lot harder, you need to declare in reverse order: France first, then the US.
If this all feels very overwhelming, don’t worry – it’s totally normal
Questions abound concerning whether or not it matters where the income was sourced (if you’re a tax resident of France, it does not) and whether or not you need to declare all your income to France (if you’re a tax resident of France, you do).
Believe it or not, after you go through your first year or two, the steps become pretty reflexive. Especially on the French side: Things are very straightforward compared to the US. For a reference point, this will be my fourth year filing taxes in France. And, I’m feeling comfortable enough to write an article about how this stuff works!
(That said, I need to mention that this is entirely for educational purposes and should not be taken as cross-border tax, legal, or any other professional advice. Always consult with a professional when in doubt, and ideally, before you’re in merde.)
Below, I’ll go through a high-level overview of how taxes work for US expats. Then, we’ll move into French taxes and filing obligations.
I’ll share common scenarios that make me shake my head and grimace, and do my best to point you in the right direction. At the end is a checklist of steps you can take to ensure that you (or at least, your bank account) come out of this tax season unscathed.
US expats will always have two tax returns to file
First things first: We all know that the United States Is Special. But one of the most important differentiators between the Land of the Free and the rest of the world will likely surprise people: how US citizens are taxed.
The US (and the East African nation of Eritrea) are the only two countries in the world to impose tax based on citizenship. This is known as citizenship-based taxation and applies to every US citizen residing outside of the US.
It doesn’t matter whether you make $10,000 a year or $1,000,000. Every year, you must file a tax return with the IRS. And, potentially other forms with other government agencies.
What’s more, this filing requirement is not limited to just US citizens. Permanent residents (AKA green card holders) and those with certain financial ties to the US must also file.
Another sneaky group that gets roped in here is Accidental Americans
Accidental Americans hold US citizenship by being born there or being registered as a citizen by an American parent. However, they often have no formal ties to the US.
In some cases, they may not even remember living there if they moved as a young child. Or, they may have never lived there at all.
In any case, Accidentals technically need to file an annual tax return with the IRS. But that could be the subject of a whole separate post. If you think you might have this status, I encourage you to confirm with a US tax expert. Then, check out supportive resources such as The Association of Accidental Americans.
So, you have to file US tax returns no matter what. But, what about French taxes?
Whether or not you file French taxes typically depends on whether France considers you a tax resident.
Many US expats make the mistake of thinking that if their income is sourced from the US, then they pay US tax on that income.
For example, a common type of US-France tax question I see frequently is something along the lines of this:
Scenario #1
“I live in France and work remotely for a US company. I pay taxes in the US because my income is US-sourced, right?”
Wrong.
While that may seem to make sense, if you think about it, it doesn’t make sense to pay taxes to the US if you reside in France.
Or this:
Scenario #2
“I work remotely for a US company and am moving to France soon, can I keep my US LLC and continue paying taxes to the US? All of my clients are there, so it’s US-sourced income.”
This is a complex question, but, as a baseline, you will at least need to create a micro-entreprise in France and pay your taxes in France. You cannot simply live in France (as a tax resident) and continue using your US LLC the same as you would if you were living in the US.
Let’s dig into the scenario of an American residing in France full-time, working remotely for an American company or as a self-employed person
Sorry, one sec. Swinging up onto my high horse here.
📢 📢 If you’re an American living in France, you have access to a lot of benefits, including:
- Universal healthcare for typically less than 100 euros a month
- Free education, or education at a highly reduced cost for yourself and/or your spouse/children
- Extensive public transport systems in major cities
- Free public schooling for all children from age three
- And so forth.
Additionally, French taxes support the infrastructure of traditional employment in France, which many US expats also benefit from. Just a couple of these include:
- Some of the strongest worker protections in the world, including extensive PTO for holidays, parental leave, sick days, and additional leave benefits
- Extensive unemployment benefits
All of these things that make France such a great place to live cost money, and the money to support this infrastructure largely comes from taxes. Bearing all this in mind, France (and every other country in the world, besides Eritrea) taxes based on residence.
Residence-based taxation in France
Understanding whether you qualify as a tax resident is typically calculated based on where you live for over half the year. In days, this looks like where you spend your time for 183 days or more during a calendar year.
Again, this is not the only test applied to gauge tax residency, but it’s generally a reliable starting point.
Basically, if you fall into one of the following categories, you are likely a tax resident of France.
You moved to and now live in France as:
- The spouse of a French citizen
- A self-employed person (profession liberale or entrepreneur visa)
- Someone employed on a CDD or CDI contract
- A retiree
Save for later: What You Need to Know About Visas in France
If you are a tax resident, then you need to declare in France and the US – typically in that order (more on that later)
Note that students are not included on this list because it depends on what type of student you are, whether you’re working, and, in some cases, the type of program you’re doing. The important thing to remember is that you will always have a US filing obligation, so as a student, the key question to answer is whether or not you need to file in France. Again, the French return will nearly always be filed before the US return, so if you mess this up, it will be an administrative headache.
Special mention #1: TAPIF program participants
The Teaching Assistant Program in France (TAPIF) is a cultural exchange program supported by the French government in collaboration with the US.
Teaching assistants are not required to file a French tax return because the wage associated with the position is very low, however, US participants in the program must still file a US tax return per citizenship-based taxation requirements. (1)
Typically and if they file their US return correctly, US teaching assistants owe $0 in taxes to the US government.
Special mention #2: Fulbright scholars in France
US citizens residing in France as Fulbright Scholars will have the dual tax filing requirement in both France and the US.
Typically, no tax will be owed to the US. However, the way you file with the IRS will differ depending on how your grant is categorized and the activity you exercise. (2)
French Taxes
The French tax year follows the calendar year (January 1st through December 31st).
The tax-governing authority in France is called the Direction Générale des Finances Publiques, (DGFiP). Declarations are made via the reporting website, impots.gouv.fr.
In my experience, the French tax system is very efficient. Every spring, depending on your department’s tax filing deadline, the tax office will notify you via email when declarations are open and it’s time to complete your return.
The instructions are clear and, compared to attempting a US tax return from abroad, it’s relatively easy to advance through the process of filing French taxes online. When a question arises, I’ve always been able to find an answer on a French government page, and the following Facebook groups have served as useful resources:
- Strictly Fiscal France (3)
- US Expat Tax Questions (4)
What are the tax filing deadlines in France?
The French tax office strongly encourages taxpayers to file their returns online and incentivizes doing so via favorable extensions and office communication conditions. However, the deadline for online returns depends on which of the 101 départements you live in:
- May 25th: Online deadline for départements 1-19
- June 1st: Online deadline for départements 20-54
- June 8th: Online deadline for départements 50-101 and Overseas France
French tax rates
French tax rates vary depending on whether or not you are employed or self-employed.
Below is a breakdown of the rates for those employed under traditional contracts.
Note that French taxes are imposed at a progressive rate, meaning that only the portion of income that falls into each band is taxed at that rate. It would be incorrect to say, for example, that someone who earns a salary of 50,000 euros is taxed 30% on that income; that would be a flat tax. (5)
| Income brackets | Income tax bracket rate |
| Up to €11,294 | 0% |
| From €11,295 to €28,797 | 11% |
| From €28,798 to €78,570 | 30% |
| From €78,571 to €177,106 | 41% |
| More than €177,106 | 45% |
Source: Quel est le barème de l’impôt sur le revenu ?
Social security taxes in France
The US has a Totalization Agreement with France that prevents Americans from having to pay social security taxes to both countries (which one they pay depends on how long they intend to live there).
Note: A Totalization Agreement is highly beneficial to US expats because it is a bilateral social security agreement. This type of agreement is important because it helps avoid double taxation on income concerning social security taxes. It also ensures they can combine work periods in both countries to qualify for retirement, disability, or survivor benefits, thus protecting benefits while working or living abroad. The US government only has them in place with select countries worldwide. (6)
For those who do have to pay French social security taxes, the exact rate and means of payment depend on their employment status.
Employees have social security taxes immediately withheld from their paychecks by their employers, typically at a rate between 20% and 23%.
Self-employed individuals must make social security payments every month or quarter. (The timing depends on the type of payment plan they selected when creating their business entity.) Those who participate in the simplest micro-entrepreneur scheme typically pay roughly between 13% and 24%.
Other self-employed people with more advanced structures can pay much higher rates but also have access to more complex business accounting and business expensing activity.
How to approach filing taxes in France
If you’ve made it this far in the article, congratulations! You’ve already taken a solid step towards a successful French tax filing season!
Filing taxes in France becomes relatively straightforward from a planning perspective when you understand the basics.
As a recap for American expats in France
- US citizens will always need to file a tax return, regardless of how long they’ve lived in France
- If you are a tax resident in France, then all of your income is declared to the French tax office, regardless of where it is sourced
- You make your French declaration first and will receive an email notification from the tax office when filing is open
- As a US expat, you receive an automatic extension until June 15th, however, you will likely want to extend your deadline to October 15th, which you can do for free, online
- Take care to research exceptionally carefully when filing your US tax return, or be very selective about who you choose to work with. In many cases, no tax should be owed to the US government, and there are special provisions associated with the US-French tax treaty that you or your expat CPA can claim to ensure your tax liability is mitigated as much as possible.
- I personally recommend using a CPA specializing in US returns for expats, ideally expats in France, due to the reasons outlined in the previous bullet.
References
- Teaching Assistant Program in France: Before Returning Home
- Fulbright Grants – IRS
- Strictly Fiscal France (Facebook group)
- US Expat Tax Questions (Facebook group)
- Is A Progressive Tax More Fair Than a Flat Tax?
- Totalization Agreements – List of All Countries
Do Expats Pay Taxes in France – FAQ
What is the expat tax rate in France?
In 2024, expats living in France who qualify as French taxpayers will pay up to 45% in taxes, depending on variables such as their income and filing status. Note that taxes in France are applied at a progressive rate, meaning that different parts of your income may fall into different tax bands.
What happens if you don’t declare tax in France?
The consequences of not making a proper declaration to the French tax authorities are potentially huge. Especially if you receive and ignore notices that you have outstanding returns to file or French taxes owed. In this case, you will receive a “‘mise en demeure.” This is a formal request for you to correct the situation. If you receive this notice, a penalty tax between 10% to 40% will be assessed on your outstanding tax owed. Additionally, if the authorities discover that income is missing from your declaration, your penalty charge could go as high as 80%.
How long can you live in France before you pay tax?
A good general rule of thumb is 183 days. But, it’s important to note that other factors may go into determining your tax residency in France.
