Law & Numbers - News Tax

Tax advantages for Expatriates in France


New guideline issued on July 30th 2009

The 4th of August 2008 law for the modernization of the economy established a special taxation regime in favor of the “expatriates” (art. 155 B of the French Tax Code). In two guidelines dated July 30th 2009 (BOI 5 F-13-09 and 5 K-2-09), the tax administration extensively comments on this new disposition.

This new special taxation regime is open to employees and managers who took office starting January 1st 2008. It also applies to independent workers, upon ruling.

The tax advantages are numerous:

The additional salary directly connected to the practice of a professional activity in France is, within certain limitations, exempted of tax up to it's actual amount. The expatriates directly recruited by a company established in France may opt for a standard evaluation of their expatriation bonus (30% of their income);
Exemption of the portion of the income related to the foreign activity;
An exemption of the income tax of up to 50% of the amount of certain private assets income perceived abroad.

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