Roche & Cie

Non-Residents: Update on Tax Representation in France

Citizens of a third country to the EU must always call on a tax representative.

The Government clarified that it did not intend to limit the obligation to appoint a tax representative to persons who have their fiscal domicile in States which have not concluded an administrative assistance agreement to combat fraud and tax evasion.

For capital gains realized on disposals made since January 1, 2015, and in accordance with Article 244 bis A-IV of the French Tax Code, as drafted under section 62 of the LFR for 2014, the obligation to designate A tax representative no longer applies when the transferor is domiciled, established or incorporated in a Member State of the European Union (EU) or in another State party to the Agreement on the European Economic Area (EEA).

On the other hand, assignors, natural or legal persons or bodies domiciled, established or incorporated outside an EU Member State or another State party to the EEA Agreement, In all cases, to appoint a tax representative.

Assignors domiciled, established or incorporated outside the EU or the EEA are, in principle, obliged to appoint a tax representative to pay the levy. The same applies to shareholders, persons or legal entities domiciled, established or incorporated outside the EU or the EEA of companies or groupings:

Which fall within the scope of Article 8 of the French General Tax Code, Article 8 bis of the CGI or Article 8 ter of the French Tax Code (CGI), whose registered office is in France;
Whose tax regime is equivalent to that provided for in those articles and whose head office is located in the EU or the EEA.

By way of derogation, the tax authorities grant an automatic dispensation from a tax representative:

  • In the case of disposals whose price is less than or equal to € 150,000;
  • In the event of an assignment benefiting from the realized capital gain from a total exemption from taxation, with regard both to income tax and social contributions, taking into account the duration of possession of the property, in application of Provisions of Article 150 VC-I of the CGI and Article L. 136-7-VI-2 of the Social Security Code, irrespective of the transfer price.

The Government was questioned by Frédéric Lefebvre on the possibility of extending the deletion initiated by the aforementioned Article 62 to assignors domiciled, established or incorporated outside the EU or the EEA in order to limit this obligation to appoint a tax representative to Only those persons who have their fiscal domicile in the States which have not concluded an administrative assistance agreement to combat fraud and tax evasion (ETNC).
He has just answered negatively.


Cabinet Roche & Cie, Expert-Comptable à Lyon