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Please note that taxation and property are complex subjects and you should not take or refrain from taking any step without full independent advice on the particular facts of your case. The content of this article is of a general nature and no liability is accepted in connection with it.
PLEASE NOTE PARTICULARLY THAT THE INFORMATION BELOW DOES NOT CONSTITUTE FINANCIAL ADVICE WHICH WE ARE NOT REGULATED TO PROVIDE. YOU SHOULD ALWAYS OBTAIN INDEPENDENT ADVICE FROM A SUITABLY QUALIFIED IFA.
If you become French resident, you will find that UK investments which used to be tax free are now taxable – for example, ISA interest, certain movements within PEPs and premium bond winnings all become declarable and potentially taxable in France.
There follows a brief guide to the simplest and most common French tax-free investments (applicable only to French residents) according to the information available to us:
|
Name
|
Interest rate
|
Limit
|
Taxation
|
Social contributions (NI equivalent)
|
Other info
|
|---|---|---|---|---|---|
| Livret A / Livret Bleu | 2.25% fixed by law | €15,300 | Nil | Nil | One account per person |
| Livret Jeune | 2.25% minimum | €1,600 |
Nil | Nil | One account per person aged 12-25 |
| Codevi | 2.25% fixed by law | €4,600 |
Nil | Nil | Two accounts per tax household |
| Plan Épargne Logement (PEL) | Fixed by law | €61,200 |
Nil | 10% approx on interest and state premium | One account per person. Account is blocked for four years. |
| Compte Épargne Logement (CEL) | Fixed by law | €15,300 | Nil | 10% approx on premiums | One account per person. Must hold for 18 months before taking loan. |
| Plan d'Épargne Populaire | According to provider | €92,000 | Nil | 10% on interest | One account per person. Account blocked for at least 8 years. |
| Plan d'Épargne en Actions | €132,000 | Nil if shares held for at least five years. Income tax on dividends due to change in 2005. | 10% on capital gains | One account per person. Contains EU shares. |
Other tax-efficient investments include:
- Assurance-vie: a form of life assurance with income tax and particularly inheritance tax benefits;
- Investing in property with debt rather than outright;
- Letting property for a certain amount of time (dispositif Robien) or to certain types of people (dispositifs Besson and Lienemann);
- Sale/leaseback purchases;
- Being a loueur en meublé professionnel;
- Buying property requiring renovation or historic monuments; and
- Buying property in the DOM-TOM (French overseas territory).
Sykes Anderson LLP has experience in advising on tax planning.
We can also recommend an IFA specialising in French investments.