What determines my French tax residency? A focus on criteria

Are you planning to move to France or already living there? Understanding your tax residency is crucial to avoid unexpected tax liabilities. But how is tax residency determined in France? In this article, we’ll explore the key criteria, including the 183-day rule, and provide guidance on navigating French tax law.

French tax residence: understanding the 183-day rule

The 183-day rule is a commonly used criterion for determining French tax residence. According to Article 4A of the French General Tax Code, a person is considered a tax resident in France if they meet one of the following criteria:

Having a home in France or a principal place of residence in France for more than 183 days. In this case, the main residence criterion takes precedence over the home criterion. For more information on setting up a home or business in France, see our page on company setting-up.
Carrying out a professional activity in France, whether as an employee or not, unless it is incidental.
Having the center of economic interests in France, which includes the main investments, the place of business, the professional activities or the main source of income. Our team can assist with business and commercial issues related to tax residence.

The concept of residence is a key element in determining the tax liability of an individual. OECD, Model Tax Convention on Income and on Capital, 2017

The criteria for determining French tax residence

To determine your French tax residence status, you must consider the following criteria:

If you have a home in France or a principal place of residence in France for more than 183 days, you will be considered a French tax resident.
If you carry out a professional activity in France, whether as an employee or not, unless it is incidental, you will be considered a French tax resident.
If you have the center of your economic interests in France, which includes the main investments, the place of business, the professional activities or the main source of income, you will be considered a French tax resident.

Tax treaties are essential for avoiding double taxation and fiscal evasion, and for promoting cooperation between tax authorities. French Ministry of Economy and Finance, “Tax Treaties”, published on February 10, 2020

Applying the 183-day rule

The 183-day rule is a key criterion for determining French tax residence. If you stay in France for more than 183 days in a year, you will be considered a French tax resident. For more information on tax residency and obligations, visit the French tax authority page on tax residence or the European Commission page on tax residence.

The 183-day rule is a key factor in determining tax residence, as it provides a clear and objective criterion for determining an individual’s tax liability. French tax authority, “Tax Residence”, published on January 15, 2022

Real-life implications of French tax residence

Let’s consider a few examples to illustrate the practical implications of French tax residence.

For instance, if you’re a freelancer who spends more than 183 days in France in a calendar year, you’ll be considered a French tax resident and will be subject to French income tax on your worldwide income. This means you’ll need to file a French tax return and report your income from all sources, including foreign clients, as explained by the OECD.
Similarly, if you’re an expat who has a home in France and spends more than 183 days in the country, you’ll be considered a French tax resident and will be subject to French wealth tax (IFI) on your worldwide assets.

In both cases, it’s essential to understand your tax obligations and seek professional advice from our tax experts to ensure you’re meeting your tax requirements and taking advantage of any available tax deductions and credits.

Key takeaways: the essential guide to French tax residence

French tax residence is a complex concept that requires a clear understanding of the applicable criteria and rules. We hope this article has helped you understand the 183-day rule and the criteria for determining your French tax residence status.

Key Criteria: French tax residence is determined by several criteria, including the 183-day rule, professional activity, and center of economic interests.
Tax Obligations: As a French tax resident, you will be subject to French taxation on your worldwide income.
Tax Treaties: France has tax treaties with many countries to avoid double taxation and fiscal evasion.
Professional Advice: If you are unsure about your tax residence status or obligations, it is recommended to seek professional advice from a qualified tax lawyer.

Get professional advice on French tax residence

At My French Lawyer, our English-speaking referenced lawyers are at your disposal to answer your queries on French tax residence. We will provide you with our best lawyer to handle the issue you face and provide you with accurate advice to determine your tax residence and obligations. Whether you are an individual or a corporate entity, our team is here to help you navigate the complexities of French tax law. Contact us today to schedule a consultation and ensure you are meeting your tax obligations in France.