Leaving France: what remains taxable after departure

Becoming a non-resident for tax purposes does not mean that France ceases to tax you. Certain income and assets remain taxable in France, even after a properly planned departure. Knowing what remains taxable avoids unpleasant surprises—and allows you to make informed decisions.

The myth of departure that erases everything

Many people mistakenly believe that a change of tax residence eliminates all French obligations. This is incorrect.

The rule is clear: once you are a non-resident, you are no longer taxed in France on your worldwide income. However, France retains the right to tax income and assets of French origin . This is the principle of territoriality.

Global income versus income from French sources

French tax resident: taxation on all income, wherever it is generated.

Non-residents: taxation is limited to French-source income only. The difference is considerable. It is also the reason for relocating. However, it leaves pockets of taxation that must be identified.

French property income

This is the first pocket of residual taxation.

Why your rents remain taxed

Real estate located in France generates income from French sources. This rental income remains taxable in France, regardless of your place of residence.

The minimum rate applicable to non-residents

Non-residents are subject to a minimum tax rate on their French-source income. This rate can be waived if the taxpayer demonstrates that an average rate calculated on their worldwide income would be more advantageous. This calculation should be done on a case-by-case basis.

The applicable tax treaty determines how this income relates to taxation in your country of residence — often by exclusion from calculation or by tax credit.

French real estate capital gains

Selling a property located in France after your departure triggers capital gains tax in France.

Sell before or after departure?

The decision is not neutral. For a primary residence, an exemption is possible under certain conditions—often lost after moving out. For a rental property, the capital gains tax regime for non-residents applies. The timing of the sale therefore changes the outcome. This decision must be made beforehand, not after moving in.

The IFI on French real estate assets

The Real Estate Wealth Tax does not end with departure.

A tax that follows the property, not the person

Non-residents remain liable for the French wealth tax (IFI) on their real estate assets located in France , provided their net value exceeds the threshold of €1.3 million. The threshold and tax rates will remain unchanged in 2026.

What you lose when you leave is the French wealth tax (IFI) on your worldwide real estate assets. What remains is the IFI on the French portion. For real estate assets largely held outside France, the savings are significant. For assets primarily held in France, they are limited.

Pensions, dividends and other income from French sources

Other income retains a French connection and may be subject to withholding tax.

The role of tax treaties

Dividends from French companies, certain pensions, and royalties: depending on their nature, these incomes may be subject to withholding tax in France, the rate of which is governed by the applicable tax treaty. The treaty allocates the right to tax between the two countries and prevents double taxation.

This is why no relocation is conceivable without an analysis of the bilateral agreement. Understanding the taxation of non-residents requires reading both French domestic law and the agreement applicable to the chosen destination.

Reporting obligations after departure

Leaving France does not cancel all declarations.

The transition year

The year of departure is unique. You remain liable for French taxes for the period during which you were still a resident. This means two overlapping tax returns: one in France and one in your new jurisdiction. This is the most challenging period to manage.

Form 2042-NR

This form is used to declare income received during your period of residence in France, specifically the year of your departure. It must be filed on time. Its preparation should be coordinated with your French tax advisor.

After the separation, non-residents continue to declare their French-sourced income. For example, maintaining ownership of rental property results in an annual reporting obligation.

How to integrate the French residual into the strategy

What remains taxable is not a problem. It's a factor to consider.

Keep, sell or restructure

Three options are generally available for French real estate assets: keeping them and renting them out, selling them before leaving, or restructuring them—holding them through a company or making an early gift. Each option has different consequences for the French wealth tax (IFI), rental income, and inheritance. The best approach depends on the individual's circumstances.

This analysis is part of our method : the French situation is never treated separately, but integrated into the overall strategy.

Monitoring obligations over time

Assets held in France generate recurring reporting obligations, years after departure. Maintaining these obligations meticulously is part of overall consistency—a point covered by our long-term support .

Leaving doesn't mean cutting all ties.

It's a persistent misconception: to be credible, you have to sell everything and leave everything behind. Wrong.

It is possible to retain real estate in France, to have partial economic interests there, to keep family there — provided that the tax implications of these residual ties are properly managed.

The question isn't about cutting everything out. The question is what remains taxable, at what rate, under which agreement, and with what obligations. Once these answers are clear, leaving becomes an informed choice rather than a leap into the unknown.

Accurately assessing what remains taxable in France after your departure is a step that Coreway incorporates into every departure analysis.