Every year, millions of taxpayers in France submit their income tax declarations during the April-June tax season. This includes the income from outside France, including India, and is explained in the DTAA between the two countries.
Income Tax declaration is done during the current year for the income earned in the previous calendar year.
For example, the 2024 declaration is done for the income earned from January to December 2023.
The various sources of income can be from salary, capital gains, bank interests, dividends, self-employment, rentals, etc. Some income sources can be tax-exempted but they have to be declared too.
DTAA – France and India
The Double Tax Avoidance Agreement (DTAA) is an agreement signed between two countries. These agreements cover a wide sources of income such as income from salaried employment, profits from business, dividends, royalties, bank interest, capital gains, etc.
These agreements provide guidelines and explain, which country holds the right to collect taxes on income. Generally, the country where the income originates retains the primary right to apply taxes on it, but the country of residency may also apply taxes, at a reduced rate.
A French tax resident’s worldwide income will be taxable in France, except when stated otherwise on the DTAA.
You can find the DTAA between France and various countries including India in Double Tax Avoidance Agreement (DTAA) between France and various countries
Declaration of movable assets
For all French tax residents, any Indian income from the following movable assets are taxable in France:
- Interest from fixed deposits in ordinary bank accounts, NRE, NRO, and FCNR accounts.
- Dividends
- Capital Gains from equity investments, etc
- Insurance policy maturity payments
- other similar assets
Sometimes, they are taxable in India too. In this case, the tax cannot exceed 10% of the gross amount but you can claim a tax credit in France. To avoid TDS and double taxation in India, you must submit Form 10F and a Tax residency certificate from France to the bank and Income tax department in India.
Government pension schemes from India can only be taxed in India.
Non-government pension schemes are fully taxable in France.
Declaration of immovable assets
For all French tax residents, any Indian income from the following immovable assets are taxable only in India:
- Capital gains from real estate.
- Rental income
However, they must be declared in France.
Disclaimer
- Any finance-related information shared is not professional legal, tax, or investment advice.
- The information provided is of an educational and general nature and is not investment advice within the meaning of Articles L. 321-1 and D. 321-1 of the French Monetary and Financial Code.
- Investment carries risks of loss and past performance does not guarantee future performance.
- For all professional advice, please consult a certified financial planner, CGP, CIF, tax consultant, etc.
Hi Prasanth,
Does the below statement mentioned in this article above means that there is no need to declare interest earned from PPF anywhere?
“Government pension schemes from India can only be taxed in India.”
Thanks,
Rohit
Hello Rohit bhai,
A PPF is a non-govt pension. So, it is taxable in France. I had explained the same in the Telegram group. Also, I will be uploading a step-by-step video on this topic very soon.
Excellent initiative Prashant !
Just one quick question – while ppf earning in India is taxable in France, is it the same for epf and gratuity as well or are they exempt here in France. How do we showcase exempt incom while filing taxes?
Hello Nikhil,
Yes, all these are taxable in France unfortunately. Please refer to my 2 video tutorials on this topic.
1. How to declare Income from Foreign Government Pensions? || Part 1: With Tax Credits || France
https://youtu.be/ZS2Yc8qVQMw
2. How to declare Income from Foreign State & Private Pensions? || Part 2: No Tax Credits || France
https://youtu.be/nq2hBW92fis
Cheers,
Prasanth
PS: If my articles and answers are helpful, please leave your feedback on Trustpilot
HI Prasanth,
Declaration of immovable assets
For all French tax residents, any Indian income from the following immovable assets are taxable only in India:
Capital gains from real estate.
Rental income
However, they must be declared in France. so it means it should be declared only but it is not going to add in your french income? do you know in which form we need to declared these immovable assests? thanks
Hello Vivek,
Yes these must be declared as exempt income via 2047 Annexure.
Cheers,
Prasanth
PS: If my articles and answers are helpful, please leave your feedback on Trustpilot
Hello Prashanth,
I checked your youtube but didnt find any videos for updating LIC maturity income declaration for french tax, can you please suggest where do we have to show them on french tax online site please,
Thank you and best regards,
Hello Nehal,
I have not made a video or article on this topic. Any foreign income declaration starts with 2047 annexure.
I will try to cover tis topic in detail after September. Currently, I am on a break until Sept and so unable to create any additional tutorials at the moment.
Cheers,
Prasanth
PS: If my articles and answers are helpful, please leave your feedback on Trustpilot