Wealthy foreign residents who are living in France for a large part of the year and who do not declare themselves as tax resident – thus avoiding wealth tax and income tax – could be caught in a new tactic by the tax office which is starting to pay informers.
Shopping a tax dodger could earn the informant a handy little bounty from the tax man – but only if they are informing on someone putting money in an undeclared foreign bank account or denouncing a wealthy person living full-time in France and not paying tax.
The ‘fisc’ has said it will pay tax-payers who denounce tax evaders but only those informing about people committing ‘international-scale offences’ in a bid to avoid being swamped with ‘twitchy curtain’ neighbours turning in small-scale offenders.
Passed as part of the last finance law, the move is a first in France where informing on people has long been rejected but is already in widespread use in the US and Germany.
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The move is valid for two years and is aimed at large-scale offenders. It will apply to people putting money into foreign accounts or tax havens to avoid paying wealth tax in France – but also to people who are living in France but not declared as tax-resident and thus avoiding wealth tax and income tax.
The new measure also covers non-declared foreign accounts, declarations on accounts and policies – such as assurance vie and trusts – whether held in France or elsewhere.
The sum paid to the informant will depend on the role they play (amount of information) and the ‘benefit’ to the fisc.
- For information on tax residency in France and income tax, you can buy our helpguide 2017 French Tax Forms from this link – it costs €12.50 for a pdf or print copy (plus P&P for the print version).