French residents are liable to wealth tax (namely Impôts Solidarité sur la Fortune) on their worldwide assets, based on the value of the assets as at 1 January each year. The tax is based on the wealth of the household, including spouse and infant children. Unmarried couples living together are treated as one household for wealth tax purposes.
Non-residents are liable to wealth tax on their French assets.
You will be considered a French resident if:
- Your family home (foyer) is in France;
- or you have your principal place of stay in France. This includes:
- Spending more than 183 days in France in a given calendar year;
- or spending less than 183 days in France but you have moved to a permanent home in France;
- or being a tax resident of no other country and making regular, substantial visits to France, but not necessarily more than 183 days in a given calendar year
- or you work in France - employed or self-employed and it is your main activity;
- or you have your centre of economic interest in France.
As tax residence rules differ from other countries, there are cases where you may end-up being dual resident. Double tax treaties between France and other countries in most cases ensure that the incidence of double taxation is mitigated by giving credit for taxes paid in one state against those in the other. But the application of those treaties is not applied in the same way in each country.
With regard to the rates, those have been amended in 2011. From 2012, the tax rates are reduced to two, ie:
- 0.25% for wealth between 1.3 million € and 3 million €,
- and 0.5% for wealth over 3 million €.
However, please note that the tax rate is charged on your total wealth, from the first euro, and not just on wealth above 1.5/3 million €.
Please note that if you are a newcomer to France, you will only be liable to wealth tax on your French assets for the first five years of your residence in France. If your French assets are below 1.3m €, then you will not be liable for wealth tax during this period.