If you’re living in France, or planning to move, and you own property overseas, one question almost always comes up sooner or later: “If I sell a property abroad, do I pay tax in France?”
The short answer is: sometimes yes, sometimes no, and timing matters more than most people realise.
This is one of the most misunderstood areas of French tax for foreigners, especially Americans and Brits moving to France. The rules aren’t intuitive, and many people only discover the implications after they’ve triggered a taxable event. Let’s walk through how it actually works.
Table of Contents
The starting point: French tax residency (not nationality)
Whether France taxes the sale of a property abroad depends first and foremost on your French tax residency at the time of sale.
French tax residency is defined by Article 4 B of the French Tax Code (Code général des impôts) and explained on impots.gouv.fr and Service-Public. There is no single “183-day rule” that applies automatically.
You are generally considered French tax resident if one or more of the following applies:
- France is your main home (foyer)
- France is the place of your main professional activity
- France is the centre of your economic interests
These criteria are assessed together, based on facts. Someone can spend fewer than 183 days in France and still be tax resident, or spend more than 183 days and not be.
This distinction matters enormously when selling property abroad.
Selling before becoming French tax resident
If you sell a property before becoming French tax resident, and the property is not located in France, then France generally does not tax the capital gain.
In other words:
- The sale is taxed according to the rules of the country where the property is located
- France is usually not involved, because neither the property nor the seller is within French tax scope at that time
This is why timing a sale before establishing French tax residency can materially change the tax outcome.
That said, it’s important to phrase this carefully:
France does not tax the gain because you are not resident and the gain is not French-source, not because France has “no interest” in foreign property as a principle.
Selling after becoming French tax resident
Once you are French tax resident, the picture changes.
France taxes residents on their worldwide income and gains, including capital gains from selling property located abroad.
That does not automatically mean you pay French tax on the gain, but it does mean:
- The sale must usually be declared in France
- The applicable tax treaty becomes critical
- French calculation rules may still apply in the background
This is where many expats get tripped up.
How tax treaties really work (and what they don’t do)
Tax treaties, including the France–US tax treaty, are designed to eliminate double taxation, not to eliminate taxation altogether.
For real estate capital gains, treaties usually state that: Capital gains are primarily taxable in the country where the property is located.
However, that does not mean France is irrelevant.
In practice:
- The gain is often taxed first in the country where the property sits
- France may still require the gain to be reported
- France then applies the treaty’s method to relieve double taxation
That relief is often a tax credit mechanism, but not always, and not always equal to the foreign tax actually paid. The exact method depends on the treaty and the nature of the gain.
> You might be interested in this article: Avoiding double taxation: A guide to the France-US tax treaty for American expats
Declaring foreign property sales in France
If you are French tax resident, foreign-source income and gains must be declared, even if no additional French tax is ultimately due.
This typically involves:
- Declaring the gain as foreign income (often via form 2047)
- Carrying it through to the main French return (2042 and related annexes)
The obligation is about reporting, not just paying tax. Failing to declare is a compliance issue, even when the treaty outcome results in zero additional tax.
What about main residence exemptions?
This is another area where assumptions cause problems.
France does have a main residence exemption for capital gains, but it is a French-law exemption with specific conditions.
It does not apply automatically just because:
- The property was your main home abroad, or
- You lived there before moving to France
Whether an exemption applies depends on timing, residency status, and how French law characterises the property at the moment of sale. It is not a blanket rule for foreign homes.
Holding period matters (and the 22 / 30-year rules)
When French capital gains rules apply, holding period abatements can significantly reduce, or eliminate, tax over time.
Under French rules:
- Income tax on capital gains is fully exempt after 22 years of ownership
- Social levies are fully exempt after 30 years
These two calculations are separate, which is why outcomes can feel counter-intuitive.
Depending on your situation and treaty treatment, French calculations can still interact with social levies even when income tax is relieved, another reason this isn’t plug-and-play.
Why getting this wrong causes long-term issues
The biggest risks usually aren’t dramatic, they’re administrative:
- Incorrect or missing declarations
- Misapplied treaty assumptions
- Later questions from the tax authorities
- Difficulty justifying historic transactions when planning future moves or investments
Selling property across borders while living in France is absolutely manageable, but it’s not something to “wing.”
Final notes
Whether France taxes the sale of a property abroad depends on three things working together:
- Your tax residency at the time of sale
- Where the property is located
- How the applicable tax treaty allocates taxing rights and relief
Sell before becoming French tax resident, and France is generally out of the picture. Sell after, and France becomes part of the conversation, even if the final tax bill ends up elsewhere.
This is why property sales should be planned as part of a broader relocation and tax strategy, not treated as a standalone event.
If you want to sanity-check timing, residency exposure, or how a treaty actually applies to your situation, that’s exactly where professional guidance saves money, and stress, later.
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