Withdrawal from the 2nd pillar (LPP): taxation in France of capital received by a cross-border worker

A French resident receiving a lump-sum retirement payment from the Swiss second pillar must declare this payment in France. The BOFiP (Official Bulletin of Public Finances) classifies lump-sum retirement benefits as pensions: they are taxable in the country of residence. The instructions for form 2041-GG stipulate taxation according to the progressive tax scale, or, upon express and irrevocable request, a withholding tax of 7.5% on the capital after a deduction of 10%. Switzerland, for its part, may withhold tax at source, the refund of which follows Swiss procedures.

This page presents the French and Swiss versions side-by-side. It does not differentiate between them: they address two different questions, and some documents from the proceedings are not available online. It is therefore intentionally incomplete.

Capital qualification in France

The BOFiP BOI-INT-CVB-CHE-10-20-60 (version of 15/07/2013) sets out two rules.

• Paragraph 110 states: "Pensions paid in respect of private salaried employment are taxable only in the state of residence of the beneficiary."«
• Paragraph 120 states: "Capital retirement benefits for private and public sector employees are considered pensions." Those paid to self-employed workers who may, by choice, benefit from occupational pension schemes remain "subject to the provisions of Article 23 of the Convention" (BOFiP wording, not extended to other self-employed individuals).

Article 20, paragraph 1, of the Convention of 9 September 1966 concerns "pensions and other similar remuneration paid to a resident of a Contracting State." The Additional Protocol contains no provisions relating to lump-sum benefits. The acronym "LPP" does not appear in the BOFiP (Official Bulletin of Public Finances): the guidance page refers to "lump-sum retirement benefits.".

One exception. The BOFiP (Official Bulletin of Public Finances) points out that Article 21 reserves taxation to Switzerland when the sum is paid by the Swiss State, a political subdivision, a local authority, or a public legal entity to a Swiss national residing in France. This does not apply to private sector employees.

What the Swiss administration says for pensioners

The page "Swiss Retirees" (updated 12/05/2026) states that private sector pensions are taxable in France. For a pension paid as a lump sum, it says: "refer to the explanatory note." This page does not address the 2nd or 3rd pillar pension schemes, nor Swiss withholding tax. The explanatory note it refers to, a step-by-step guide published by the Haute-Savoie prefecture, was illegible at the time of writing; therefore, this page relies on form 2041-GG.

Progressive scale or 7.5% levy %

The 2041-GG form read here (year 2026, income 2025) distinguishes between two approaches. Capital received in 2026 is considered income for 2026: the corresponding instructions should be reviewed before taking any action, as the rates, allowances, and boxes in the instructions are not set for this type of income.

The text specifies: "The benefit of the 7.5% withholding tax is reserved for payments made in full." This page does not compare the two options in euros: the information sheet does not provide a pension scale applicable to a lump sum, and the result depends on the entire household income.

Social charges

Regarding social security contributions, the instructions indicate that capital subject to the withholding tax is reported on form 2042 C and in section VIII of form 2047, in box 8SA for the rate of 8.3% of %, 8SB for 3.8% of %, or 8SD for the median rate of 6.6% of %. The CSG (General Social Contribution) paid on this capital "is not deductible." The tax base for these levies is not specified in the pages consulted: it is not quantified here.

The notice also applies to individuals "covered, in any capacity whatsoever, by a mandatory French health insurance scheme." Its application to second-pillar pension benefits received by a cross-border worker is not addressed in the notice; the two sections are separate. The choice of health insurance is discussed on the related page concerning the right of option under the Swiss Federal Law on Health Insurance (LAMal).

Swiss withholding tax and its reimbursement

The BOFiP stipulates that beneficiaries can obtain a refund of the Swiss withholding tax, "at the latest within three years of the expiry of the benefit", from the cantonal administration of the institution's headquarters.

The Federal Tax Administration (FTA, updated 22/09/2026) outlines the procedure for a pension or lump sum payment from the second pillar: complete form Q-IS, have it certified by the tax authority of your country of residence, and then send it to the tax office of the canton where your pension fund is headquartered. In the form (version 01.2026), France is listed first among the countries. The tax authority must confirm that it has "effectively taxed the benefit," and a tax certificate must be attached. Individuals residing in France must also include "the method of calculating the actual tax liability." For a lump sum payment, a copy of the institution's payment statement is required.

The canton of Geneva, for its part, describes the withholding tax on pension benefits. It applies to a person who does not reside in Switzerland when the institution has its headquarters or a permanent establishment in Geneva and "there is no double taxation agreement (DTA)", or when the agreement "stipulates that Switzerland must tax you" (page updated on 26/05/2026).

These two levels are not contradictory: the BOFiP (French Official Tax Bulletin) specifies where capital is taxed for a resident of France, while Switzerland describes its withholding tax and how to recover it. This page does not resolve the question of which withholding tax applies to your specific case: the AFC (Federal Tax Administration) publishes cantonal tax rates for pension benefits starting in 2026, without the rates listed here.

Capital withdrawal: numerical example (fictitious profile)

Situation. Paul, a former cross-border worker in the private sector, resides in France. His Swiss pension fund will pay him a gross lump sum of €200,000 on September 15, 2026 (fictitious figures, single payment). He meets the conditions for opting for the 7.5% withholding tax (%), and he can justify the deductibility of the contributions. Calculation assumptions: the 7.5% withholding tax rate and the 10% allowance are those in the information leaflet (2025 income); the information leaflet for 2026 income, applicable to a lump sum received in 2026, should be reviewed.

Issue. Evaluate the income tax due in France under the option, and find out the deadline for claiming the Swiss withholding tax.

Strategy. Apply the 10 % allowance then the 7.5 % rate from notice 2041-GG, and move the three-year deadline from BOFiP to the calendar.

Result (CALCULATION).

This calculation only covers income tax under the option. It does not include social security contributions (base not specified), any potential amount of Swiss withholding tax, or a comparison with the progressive tax scale.

How many withdrawals?

The Federal Social Insurance Office (FSIO, page published on 05/01/2026) states, in its section on flexible retirement (partial retirement subsection), that when old-age benefits are received as a lump sum, "withdrawal can be made in a maximum of three stages." The same page specifies that the pension fund may authorize more than three stages; this clarification follows the rule concerning annuities, and the page does not explicitly link it to lump sums: you should check your pension fund's regulations. The three-stage rule is similar to a French condition: the 7.5% levy is reserved for non-split payments. The two texts are not linked in the pages consulted. Anyone considering a multi-stage withdrawal should read both conditions together.

The FSIO's FAQ on withdrawals upon leaving Switzerland assumes a permanent departure from the country. It does not address cross-border workers: it is not used here to determine whether or not a cross-border worker can withdraw their capital.

What this page doesn't say

• If your cross-border worker status allows for the withdrawal of capital from the compulsory or supplementary asset.
• The processing of the 3rd pillar and buybacks.
• The Swiss withholding tax rate applicable to your fund.
• The numerical comparison between progressive scale and levy of 7.5 %.
• The basis for social security contributions on capital.

What changes depending on your situation

• Your status : private sector employee, public sector employee with Swiss nationality, or self-employed worker who can opt for occupational pension provision (article 23).
• The canton of the seat from your pension fund.
• The splitting of the withdrawal : one or more steps.
• The origin of the payments and their deductibility in the state that had the right to tax.
• Your household income, which determines the tax according to the scale.

The rule depends on your situation. No results are guaranteed.