Legal news

The starting point of the five-year limitation period that company members may invoke against the creditors of an SCI cannot differ from the starting point that may be invoked directly by the company itself.

Case law indeed considers that the starting point of the limitation period for actions brought by creditors against the members of a company cannot be the date on which proceedings against the legal entity are exhausted, even though such exhaustion is a necessary prerequisite.

1. For a Société Civile Immobilière (SCI), i.e. a partnership, the members are personally liable without limit for the company’s debts, in proportion to the number of units each member holds (Article 1857 of the Civil Code).

II.Although the articles of association may provide for a different allocation, such provisions cannot be invoked against third parties (unless they have accepted them).
The members’ liability is therefore not limited to their contributions, unlike in other types of companies.

Under Article 1858 of the Civil Code, creditors may, however, only take legal action against the members after having previously and unsuccessfully pursued the legal entity. The following article adds that such actions become time-barred after five years.

This means that the right to proceed against a member is subsidiary: the company remains the principal debtor and must therefore be pursued first. Moreover, the two proceedings cannot be conducted simultaneously.

Conclusion: third-party creditors may bring an action directly against the members, but they have a five-year limitation period to do so.

The question before the courts then became: when does this limitation period begin to run?

III. An SCI named “Hippopotame” (this is not made up) took out a 20-year bank loan. When it failed to meet its repayment obligations, the legal entity was subjected to enforcement proceedings initiated by the bank with a view to a forced sale of the property the company had purchased.

A voluntary sale was permitted, and the draft distribution order was approved by the enforcement judge on 3 January 2012.

However, the sale did not allow the company’s debt to be fully cleared… yet the bank let time pass and only issued a payment order against the SCI on 27 February 2017 with a view to seizure.

A certificate of unsuccessful recovery was drawn up on 6 March 2017, which forced the bank to sue a member for the outstanding balance on 14 June 2017.

The dates are crucial here for calculating the limitation period.

A technical debate arose between the parties regarding the starting point of the limitation period that the member sought to invoke against the third-party creditor. Two theories were put forward:

1. The starting point should be considered the date on which proceedings against the company are exhausted.
2. The five-year period would thus begin to run on the day when the creditor has fully exhausted proceedings against the company and is then compelled to turn to the members.
3. This was also the Court of Appeal’s position.
4. It upheld the bank’s claim and considered that, in this case, the starting point of the limitation period for the action against the individual member of the SCI for the unpaid loan was the date of the certificate of unsuccessful recovery, i.e. 6 March 2017.
5. From that date, the bank therefore had a new five-year period. The summons of 14 June 2017 was therefore far from being time-barred.
6. Or should the starting point of the limitation period be the same with respect to both the company and its members?
7. The creditor would then have a strong interest in acting quickly against the company, otherwise they risk no longer being able to pursue the members. This is precisely the core issue of the present ruling, which has the distinction of being published in the Bulletin (Court of Cassation, 3rd Civil Chamber, 19 January 2022, No. 20.22.205).

By setting the starting point of the five-year limitation period at 6 March 2017, the date of the certificate of unsuccessful recovery following an ineffective payment order, the lower courts found that the summons of the member for the outstanding amount had been brought well within time. They therefore ordered the member to pay the remaining balance of the bank loan.

Med venlig hilsen / Kind regards

Cabinet Nicolas BRAHIN

Advokatfirma i NICE, Lawyers in NICE

Camilla Nissen MICHELIS

Assistante – Traductrice

1, Rue Louis Gassin – 06300 NICE (FRANCE)

Tel :   +33 493 830 876      /    Fax : +33 493 181 437

Camilla.nissen.michelis@brahin-avocats.

www.brahin-avocats.com

This calculation is an essential step in the context of a gratuitous transfer, whether it involves movable property, real estate or agricultural enterprises.

The aim is to determine the taxes that each heir, donee or legatee must pay, depending on the value of the transferred assets, the applicable tax allowances, the relevant tax rates, and any possible reductions.

This text sets out the principles and steps involved in calculating inheritance tax based on the applicable legal and tax provisions.

1. General Principles for Calculating Inheritance Tax

Traditionally, inheritance tax is calculated on the net share received by each beneficiary. This calculation is based on three main steps:

• Application of tax allowances: Allowances may be general or specific and are applied to each taxpayer’s net taxable share.
  • Calculation of tax according to a progressive rate: The applicable rate varies depending on the family relationship between the deceased and the beneficiary.
  • Application of any reductions: Certain situations may give rise to tax reductions based on specific criteria.

Special rules relating to the location of assets

When an estate includes assets located in different territories—such as mainland France, the overseas departments, French Polynesia, Saint-Pierre and Miquelon, Wallis and Futuna, or the French Southern and Antarctic Lands—inheritance tax is calculated on the total value of the estate, taking into account the relevant allowances, charges, and deductions.

However, the tax due is only payable in proportion to the value of the assets located in the territories covered by the French Tax Code (Code général des impôts).

2. Content of the Inheritance Tax Return

The inheritance tax return must include the information necessary for calculating the tax, including:

• Determination of the taxable shares allocated to each heir, donee or legatee.
  • Calculation of the tax owed by each person, taking into account exemptions, allowances, rates and possible reductions.

Specific Allowances Depending on the Degree of Kinship

1. Main allowances for direct and collateral relatives

• The parents and children of the deceased are entitled to an allowance of €100,000 on their inheritance share.
  • The deceased’s siblings may benefit from an allowance of €15,932, unless the conditions of Article 796-0 ter of the French Tax Code are met.

2. Nephews and nieces

• Nephews and nieces of the deceased are entitled to an allowance of €7,927 on their inheritance share.

3. Special allowance for heirs with disabilities

• Heirs with disabilities are entitled to a special allowance of €159,325, regardless of their degree of kinship with the deceased.

4. Allowance in the absence of any other allowance

• If no other allowance applies, an allowance of €1,594 is granted for each inheritance share. This applies to any heir or legatee, regardless of kinship—even in the absence of any family relationship.

Special Rules Related to Kinship

• Transfers between foster parents and children raised by the State or by the Nation may, under certain conditions, benefit from the tax rate applicable to direct descendants.
  • In cases of simple adoption, kinship is not taken into account when calculating inheritance tax.

Conclusion

In matters of inheritance tax, the applicable allowances vary mainly depending on the degree of kinship between the deceased and the heirs. The most substantial allowances apply to parents, children, siblings, and nephews and nieces.

Heirs with disabilities benefit from a special allowance, while a standard allowance of €1,594 applies if no other allowance is available, regardless of kinship. These rules allow the tax burden to be adjusted according to family proximity and specific personal circumstances.

The calculation of inheritance tax is based on general principles, including the application of allowances, the calculation of tax according to progressive rates, and potential reductions. Special rules apply when estate assets are located in different territories.

Finally, the inheritance tax return must contain all the necessary information to determine the tax owed by each beneficiary. These rules help ensure a fair and legally compliant distribution in accordance with the tax laws in force.

Med venlig hilsen / Kind regards

Cabinet Nicolas BRAHIN

Advokatfirma i NICE, Lawyers in NIC

Camilla Nissen MICHELIS

Assistante – Traductrice

1, Rue Louis Gassin – 06300 NICE (FRANCE)

Tel :   +33 493 830 876      /    Fax : +33 493 181 437

Camilla.nissen.michelis@brahin-avocats.com

www.brahin-avocats.com

A société civile immobilière (SCI) is a legal structure composed of at least two people, each holding the status of partner, allowing the management of one or more real estate properties for non-commercial purposes. The property portfolio is owned by the SCI, and each partner receives shares proportional to their contribution.

There are different types of SCIs depending on your needs, such as:
• management or rental SCI,
• time-share use SCI,
• family SCI,
• etc.

Like all companies, an SCI has articles of association governing its functioning. Drafting these articles makes it possible to define decision-making procedures, for example, unanimous approval or majority voting.

In addition, the partners of an SCI appoint a manager (gérant), who is responsible for the day-to-day management of the company’s property or properties, without needing to carry out formal procedures with the other partners.

SCI and joint ownership: what is the difference?
Co-owning a property with several people most often occurs under the regime of joint ownership (indivision). This structure requires no formalities and applies automatically, particularly in inheritance situations involving several heirs.

Under joint ownership, each co-owner holds an ideal (undivided) share, but their rights extend to the entire property. In contrast, in an SCI, each partner holds only the shares they have contributed, and their rights are limited to those shares.

SCI: what are the advantages?
An SCI makes it easier to manage and transfer a real estate portfolio.

Management of properties within an SCI
In an SCI, debts and profits generated by the company’s properties are shared among the partners. If work needs to be carried out on the properties the company owns, the costs are borne by all partners in proportion to their shares.
Furthermore, selling a property requires at least the approval of partners representing the majority of the company’s shares. In the event of disagreement or conflicting intentions, the SCI structure helps protect the property portfolio. This makes an SCI particularly well-suited for managing family property.

Transfer of property within an SCI
An SCI also makes it easier to transfer property. If, as parents, you wish to transfer a property to your children, you may gradually transfer shares in the SCI to them. This allows you to benefit from the tax allowances applicable to direct-line inheritance, amounting to €100,000 per child for each donation, renewable every 15 years.

What steps are required to create an SCI?
To set up an SCI, you must:
• draft the articles of association, specifying the manager and the company’s registered address (which may be the manager’s residence),
• contribute and deposit the company’s capital in a bank,
• publish a notice of incorporation in a legal announcement newspaper,
• register the company online.

What taxation applies to an SCI’s profits?
Your SCI can generate profits if the properties it owns are rented out and you receive rental income.

Real estate income received through an SCI is subject to personal income tax. Each partner must declare the amounts they receive from the SCI in their personal tax return.

If your SCI rents out furnished properties, this may be considered a commercial activity. This is the case if the SCI engages in commercial activity to an extent that is no longer incidental to its civil purpose—i.e., if it exceeds 10% of turnover excluding VAT. In such cases, the company becomes subject to corporate tax.

Med venlig hilsen / Kind regards

Cabinet Nicolas BRAHIN
Advokatfirma i NICE, Lawyers in NICE
Camilla Nissen MICHELIS
Assistante – Traductrice
1, Rue Louis Gassin – 06300 NICE (FRANCE)
Tel : +33 493 830 876 / Fax : +33 493 181 437
Camilla.nissen.michelis@brahin-avocats.com www.brahin-avocats.com

Confusion between life insurance and death insurance is common. However, they are two very different types of contracts. What characterizes these contracts?

How and for what purpose can you take them out? Explanation.

Life Insurance: What Are Its Features?

Life insurance is a medium- to long-term savings product.

Once the contract is opened with an initial deposit, you can make contributions (also called premiums), regular or not, without any limit on the amount.

When the contract ends, the beneficiaries (yourself or a third party designated in the contract) receive the accumulated capital or a lifetime annuity.

Life insurance is also an interesting investment tool for estate planning. It allows you to designate one or more beneficiaries through the beneficiary clause.

Contracts taken out in the name of a spouse, civil union partner (PACS), certain non-profit organizations, or in favor of siblings, may under certain conditions be exempt from inheritance tax.

In other cases, the capital may be taxable depending on:

• the date the contract was opened,
• the date of payments,
• your age at the time of payments,
• the amount of capital paid to beneficiaries.

What Are the Main Types of Life Insurance Contracts?

When you take out life insurance, you can choose between two main types of contracts:

• Single-asset contracts, also called euro funds,
• Multi-asset contracts, also called unit-linked contracts.

Contributions made to a euro fund are guaranteed, but the return is limited.

Multi-asset contracts usually include a portion in euro funds and a portion in unit-linked investments. Unit-linked life insurance is riskier than euro funds.
Important: there is no guarantee you will get back your full investment if you choose unit-linked funds.

You may suffer capital losses depending on financial market fluctuations. That’s why it’s recommended to invest over the long term to smooth out market volatility and maximize potential returns.

Investing in unit-linked funds gives you access to a wide range of financial instruments with varying degrees of volatility.

Thus, before investing in unit-linked funds, it’s important to determine your risk profile with your bank advisor or insurance company, your wealth goals, and your investment horizon.

Unit-linked funds are typically invested in shares of mutual funds (UCITS) that hold stocks or bonds. Your payments can also be invested in property funds through real estate investment companies (SCPI).

Life Insurance: A Flexible Investment

Life insurance is notable for its flexibility.

When you take out a life insurance policy, you are free to request partial redemptions or a full withdrawal of your accumulated capital at any time.

This option is subject to the beneficiary’s acceptance (which may be a different person than the contract holder). The beneficiary must provide written consent if they have accepted their designation according to the legal procedure.

A full withdrawal terminates the contract. You can also ask your insurer for a loan (advance) on your contract. This advance is a loan granted by the insurance company, and interest is charged at the rate set in the contract.

What Are the Tax Rules for Life Insurance?

Life insurance is attractive in part due to its tax advantages. Only gains are taxable when you make a withdrawal (partial or full).

The taxation of life insurance depends on several factors:

• the date of premium payments,
• and the contract’s duration.

Since September 27, 2017, gains from premiums paid after that date are subject to a flat tax (PFU) of 30% if the contract is less than eight years old.

After eight years, you benefit from an annual tax exemption of €4,600 (or €9,200 for married or civil union couples filing jointly), and a reduced tax rate of 24.7% on gains (income tax and social contributions) if the total premiums paid are less than €150,000.

Tax on Gains from Premiums Paid Before September 27, 2017

For premiums paid before this date, your gains are subject to either:

• the progressive income tax scale via your tax return, or
• a withholding flat tax (PFL) if you choose it.

In all cases, social contributions of 17.2% also apply.

Tax on Gains from Premiums Paid After September 27, 2017

For premiums paid after this date, gains are taxed based on the contract’s duration and the amount of premiums paid.

The €150,000 limit applies to all your life insurance contracts combined.

According to the tax authorities, when your total premiums across all contracts exceed €150,000, only the portion of gains related to the first €150,000 in premiums qualifies for the 7.5% rate.

If you wish, you can opt for taxation under the progressive income tax scale, but this will then apply to all your investment income.

Additional Notes:

Individuals whose reference taxable income (revenu fiscal de référence) in year N-2 is below €25,000 (or €50,000 for joint taxpayers) may request exemption from the non-liberatory withholding tax (12.8% or 7.5%).

After 8 years, you benefit from an annual exemption of €4,600 (€9,200 for married/PACS couples filing jointly) on your withdrawal gains — this portion is not subject to income tax.

In Which Cases Can You Be Exempt from Tax?

You may be exempt from income tax on withdrawals or contract termination if you are:

• dismissed from your job,
• liquidated due to bankruptcy,
• forced into early retirement,
• officially recognized as disabled (categories 2 or 3).

You must be the policyholder or their spouse/PACS partner, and the contract must be closed by the end of the year following the qualifying event.

Lifetime Annuity Payments: How Are They Taxed?

Life insurance allows you to convert your capital into a lifetime annuity. Your insurer guarantees periodic payments (monthly, quarterly, or semi-annually) until your death.

This option is irreversible: you permanently give up control over the capital in your contract. Therefore, you cannot pass on your life insurance at death.

The annuity amount depends on:

• the size of the capital,
• your age when the annuity begins.

The annuity is taxable (income tax and social contributions).

The taxable portion of the annuity depends on your age at first payment and is fixed as follows:

• 70% taxable if you are under 50,
• 50% if you are between 50 and 59,
• 40% if you are between 60 and 69,
• 30% if you are over 69.

Death Insurance: What Is It?

Death insurance is a protection policy. You pay premiums to the insurance company, which pays a lump sum or annuity to your beneficiaries upon your death.

Unlike life insurance, you cannot be the beneficiary yourself. You must designate one or more people as beneficiaries when signing the contract. The amount to be paid is also fixed at the time of signing.

There are two types:

• Term death insurance: valid for a set period,
• Whole-life death insurance: valid indefinitely.

Insurance to Protect Your Loved Ones

Death insurance is a tool to protect your family financially against unexpected life events, especially if you die or become permanently disabled.

Depending on the policy, additional coverage may include:

• Accidental death,
• Total and irreversible loss of autonomy,
• Illness (if diagnosed after the contract starts),
• Temporary unemployment.

How Much Does Death Insurance Cost?

The cost of death insurance varies by contract and the capital to be paid to beneficiaries.

The premium also depends on your personal situation:

• your age at contract start,
• your lifestyle,
• your health condition.

What Tax Applies to the Capital From Individual Death Insurance?

The capital paid to the designated beneficiaries is not part of the estate and is therefore not subject to inheritance tax.

However, this exemption depends on certain conditions:

• Premiums paid after age 70 are included in the estate and subject to tax, with a €30,500 allowance for all premiums paid.
• If you die before age 70, only the premiums paid in the last year of the contract are taxable, at a rate of 20%, after a €152,500 allowance. For amounts above €700,000, the rate is 31.25%.

Full tax exemption applies if the beneficiary is the deceased’s spouse or **PACS partner.

Med venlig hilsen / Kind regards

Cabinet Nicolas BRAHIN

Advokatfirma i NICE, Lawyers in NIC

Camilla Nissen MICHELIS

Assistante – Traductrice

1, Rue L

ouis Gassin – 06300 NICE (FRANCE)

Tel :   +33 493 830 876      /    Fax : +33 493 181 437

Camilla.nissen.michelis@brahin-avocats.com

www.brahin-avocats.com

The adoption of the Finance Act for 2025 followed an unusual timeline. In fact, the examination of the draft law, which was presented in October 2024, was interrupted by the resignation of the government on December 5.

To ensure the continuity of public services at the beginning of 2025, Parliament adopted special Law No. 2024-1188 on December 20, 2024, as provided for by the Organic Law on Finance Acts. This law made it possible to collect taxes and raise loans to finance state and social security expenditures.

The draft law returned to Parliament’s agenda in January 2025, and the adoption process led to the enactment of Finance Act No. 2025-127 of February 14, 2025, for the year 2025.

Below is an article-by-article presentation of the main tax measures adopted in the law.

Individuals: Measures in the 2025 Finance Act

Increase in the income tax scale.

Income Tax – Key Measures in the 2025 Finance Bill

Adjustment of income tax brackets

The income tax (IR) scale brackets, along with the associated thresholds and limits, will be increased by 1.8%.

Donations to organizations helping people in difficulty

Organizations that support individuals in difficulty will continue to be eligible for tax-deductible donations.

Associations that support victims of domestic violence will now also qualify for tax deductions for donations made to organizations that assist people in need.
All amounts donated for this purpose from January 1, 2024, onwards will be considered, up to a limit of €1,000.

Tax Exemption for Tips

Tips given by customers for services have been exempt from social security contributions and income tax since 2022.

This exemption will be extended into 2025.

Introduction of a Differential Contribution for High Incomes

A new contribution will be introduced to ensure a minimum taxation rate of 20% on the highest incomes (above €250,000, or double that amount for a couple), with a reduction mechanism to avoid sharp threshold effects.

Increase in Penalties for Polluting Vehicles

The CO2 tax (“malus CO2”) and the weight-based tax (“malus masse”) will be increased, and the deduction system will be adjusted to better account for the depreciation of used vehicles.

• The CO2 tax will be gradually increased and, by 2027, will apply from 103 g CO2/km, with a maximum amount of €90,000.
• The weight-based tax will apply to vehicles weighing over 1,500 kg from 2026.
• The deduction on the penalty tax will be adjusted and become more favorable for newer vehicles.
• A retroactive penalty will be introduced in 2026 for vehicles that were not taxed at the time of their first registration.

How does the penalty tax on polluting vehicles work?

Reduced VAT for Heating-Related Work

The reduced VAT rate of 5.5% will be extended to include district heating systems powered by renewable energy.
Boilers using fossil fuels will be excluded from this reduced rate, except for maintenance and repair of existing equipment.

Tax Exemption for Gifts to Descendants for Home Purchase or Renovation

Gifts made to children, grandchildren, great-grandchildren, or, in their absence, nieces or nephews, intended for the purchase or energy renovation of a home, will be exempt from gift tax within a double limit:

• €100,000 per donor per recipient, and
• €300,000 per recipient in total.

Med venlig hilsen / Kind regards

Cabinet Nicolas BRAHIN

Advokatfirma i NICE, Lawyers in NIC

Camilla Nissen MICHELIS

Assistante – Traductrice

1, Rue Louis Gassin – 06300 NICE (FRANCE)

Tel :   +33 493 830 876      /    Fax : +33 493 181 437

Camilla.nissen.michelis@brahin-avocats.com

www.brahin-avocats.com

It should first be recalled that holding a bank account abroad by a French tax resident is in no way prohibited under current law. However, pursuant to article 1649 A of the French General Tax Code (CGI), a reporting obligation applies to the taxpayer.

The latter must declare to the tax authorities all accounts opened, held, used, or closed outside the national territory. This is done by means of Form No. 3916-3916 bis. In addition, the taxpayer is subject to a regularization obligation.

To this end, he or she must file with the local tax office a regularization dossier indicating the bank accounts held abroad and must be able to justify the origin of the funds placed abroad.

The scope of this provision has furthermore been extended to include life insurance policies taken out abroad (art.1649 AA CGI) as well as certain trust-related arrangements (art. 1649 AB CGI). In the event of failure to comply with the reporting obligation, the taxpayer is liable to a flat fine of 1.500 euros per undeclared account.

The penalty is increased to 10.000 EUR per undeclared account when the account is held in a jurisdiction that has not concluded an agreement with France for the prevention of tax fraud and tax evasion.

With regard to the conditions for calculating the tax due, the general rules relating to the determination of the taxable base are set out in Articles 4 A, 4 B and 12 of the French General Tax Code. The taxable base includes, in particular, income derived from accounts, such as interest and fixed-income investment income (Article 124 CGI), dividends and profit distributions (Article 108 CGI), as well as capital gains on securities (Article 150-0 A CGI).

Finally, administrative tax guidelines (BOI-IR-DOMIC-10-20-20) provide that foreign-source income must be expressed in EUR, taking into account the exchange rate applicable on the date of receipt.

The calculation of tax also involves the application of the progressive income tax scale according to taxable income (Article 197 CGI), as well as social contributions (BOI-RPPM-RCM-20-15). Since 2018, there has also been a flat tax of 30% (prélèvement forfaitaire unique) on most investment income (BOI- RPPM-PFVMI-20-10). In addition, article 1727 CGI establishes the principle of late payment interest in the event of late payment or incomplete declaration, set at 0.20% per month.

Furthermore, article 1729 CGI provides for a surcharge in the event of non- compliance or failure to declare: this amounts to 40% in cases of deliberate non- compliance and 80% in cases of fraudulent conduct or abuse of law. Finally, administrative tax doctrine BOI-CF-INF-10-20-10 sets out the procedures for applying these surcharges.

As regards the calculation of any tax due, the principle of non-double taxation applies. This principle is implemented through agreements concluded between two or more countries in order to resolve issues relating to taxpayers’ cross-border taxation.

It is therefore necessary to verify the existence of a tax treaty between France and the foreign country where the relevant account is located. These bilateral conventions, available in particular on the impots.gouv.fr website, set out the methods for eliminating double taxation.

Two main methods of eliminating double taxation under such treaties are recognized: the tax credit method and the exemption method. In accordance with Article 23 B of the OECD Model Tax Convention, the tax credit method allows the foreign tax paid to be credited against French tax due, within the limit of the latter.

The tax credit thus corresponds to the tax actually paid abroad, capped at the amount of French income tax due on the same income base. The conditions and practical arrangements for this mechanism are specified by administrative doctrine (BOI-IS-RICI-30-10-20-10). Proof of taxation abroad is mandatory (BOI-INT-DG-20-20 § 100 et seq.).

Where the tax credit is equal to the French tax due, it cancels out French income tax liability, but does not exempt the taxpayer from social contributions. The exemption method, on the other hand, consists in exempting in France certain foreign-source income, subject to the conditions laid down in the applicable tax treaty.

The principles of this method are also set out in Article 23 B of the OECD Model Tax Convention, while details of the implementation of double taxation relief are provided by administrative doctrine (BOI-INT- DG-20-20-100).

Finally, a further mechanism deserves mention, namely the additional tax payable in cases where taxation abroad is lower than the taxation that would have applied in France. Three scenarios can be identified.

First, when the tax paid abroad is lower than the amount that would have been due in France, the taxpayer must pay the difference to the French Treasury (article 23 B of the OECD Model Convention). Second, in the absence of any taxation abroad, the taxpayer is fully taxed in France.

This is notably the case when the taxpayer is unable to provide proof of actual payment of foreign tax (BOFiP–BOI-INT- DG-20-20, § 90). Finally, there are particular situations: on the one hand, cases where income is exempt abroad but taxable in France, the treatment of which depends on the terms of the applicable bilateral treaty; on the other hand, cases where income is subject to foreign withholding tax, in which event the taxpayer must provide evidence of the amount actually withheld, by means of a certificate or a statement (BOFiP–BOI-INT- DG-20-20, § 100 et seq.).

Ultimately, the tax regularization of accounts held abroad by a French tax resident cannot be reduced to a mere reporting formality. It falls within a demanding regulatory framework combining reporting obligations, financial penalties, and methods of tax calculation.

The application of international tax treaties, in conjunction with domestic law, plays a decisive role, as it allows either the allocation of a tax credit corresponding to foreign taxation or the exemption of the income concerned. This coordination is intended to prevent the risk of double taxation while ensuring that the French tax authorities can collect the tax owed.

The combination of these various rules reflects the legislator’s and the administration’s intention to guarantee fair taxation of foreign-source income while combating tax fraud and evasion.

Med venlig hilsen / Kind regards

Cabinet Nicolas BRAHIN

Advokatfirma i NICE, Lawyers in NIC

Camilla Nissen MICHELIS

Assistante – Traductrice

1, Rue Louis Gassin – 06300 NICE (FRANCE)

Tel :   +33 493 830 876      /    Fax : +33 493 181 437

Camilla.nissen.michelis@brahin-avocats.com

www.brahin-avocats.com