“Alexis, I don’t understand: I’m a resident of Portugal — why is the French tax authority claiming 17.2% in social levies on my rental income from Lyon?”
This question from a client illustrates the classic pitfall of non-resident taxation.
My answer was that of a compliance audit: “Because you are not affiliated to a social security scheme of the EU or the EEA.”
I am Alexis Sagnier.
As an Augmented Wealth Engineer, I do not merely observe the tax; I model the trajectories. For this client, a switch to the LMNP regime (Non-Professional Furnished Lettor) made it possible to wipe out this charge thanks to depreciation.
At Balmont Conseil, we turn the tax constraint into a performance lever. For a non-resident, France is not merely a territory of taxation — it is a field for high-precision international wealth strategies.
Determining tax status: Beyond mere physical presence
Before talking figures, we must talk law. The assessment of tax residence is not simply a matter of counting 183 days. The French authorities use a body of indicators (home, centre of economic interests, professional activity).
The importance of international tax treaties
To avoid double taxation, we analyse bilateral international tax treaties. It is they that arbitrate which country has the right to tax your dividends or your rental income. Our role is to secure your expatriate tax status in order to avoid any risk of reclassification, while optimising the tax exemption provided for by certain treaties.
The most common mistake is to believe oneself protected by one’s foreign residence when the bulk of one’s income comes from France. If your major economic interests remain within France, the French tax authority may invoke Article 4B of the CGI to consider you a French tax resident, with taxation on your Worldwide Income.
Taxation of rental income for non-residents: The 20% wall and the avoidance solutions
The minimum-rate mechanism
20% on the portion of net taxable income below a certain threshold (around €27,000).
30% above that.
However, if you can prove that your average rate of taxation on your worldwide income would be lower, you may request the application of that average rate. This is where the expertise of Balmont Conseil comes in: we calculate this worldwide rate for you to optimise your tax return.
Expatriate social levies (CSG/CRDS): The geographical criterion
1. Residents outside the EU/EEA/Switzerland zone: You pay 17.2% in social levies.
2. Residents within the EU/EEA/Switzerland zone: Thanks to the de Ruyter ruling and to legislative developments, this rate falls to 7.5% (solidarity levy), provided you are not a charge on a French social security scheme.
The 2026 rental-income return: Anticipating Form 2044-SPE
One entry error, and you are guaranteed an automatic tax audit triggered by the authorities’ AI.
Ready to structure your future?
Your wealth deserves expertise commensurate with your ambitions.
Whether you are in Lyon or on the other side of the world, Alexis Sagnier and the Balmont Conseil team are at your service.
Advanced strategies: European SCPIs and bare ownership
For the non-resident, the objective is often to disconnect the performance of the assets from French taxation.
SCPIs for non-residents: The power of Europe
Investing in SCPIs that hold assets in Germany, Spain or Ireland makes it possible to benefit from the tax treaties of those countries.
- Advantage: The income is not treated as rental income from a French source. It therefore escapes social levies (17.2% or 7.5%) and the minimum rate of 20%.
Bare ownership: Wiping out the IFI
The Real Estate Wealth Tax (IFI) strikes only French property assets above €1.3m. By investing in bare ownership, you take the asset out of your IFI base for the entire duration of the dismemberment (often 10 to 15 years), while preparing an optimised transfer of wealth.
Expatriate financial investments: Arbitrating for liquidity and security
The investments to avoid
- Equity Savings Plan (PEA): Although it can be retained, it loses its tax advantages in many countries of residence. In the USA, for example, it is treated as a PFIC (Passive Foreign Investment Company), entailing punitive taxation and complex reporting obligations (Form 8621).
- Livret A and PEL for expatriates: Although they remain accessible, their return is often eroded by inflation and by the impact of exchange rates if you live in a dollar or Swiss-franc zone.
The recommended investment products
Non-resident life assurance is the cornerstone of any expatriate wealth management. At Balmont, we recommend Luxembourg life assurance.
- Luxembourg security triangle: A legal separation between clients’ assets, the insurer’s own funds and the custodian bank.
- Tax neutrality: Luxembourg does not tax non-residents. Only the country of tax residence applies its rules upon withdrawals.
- Multi-currency management: Crucial for neutralising currency risk.
The Exit Tax and anticipating the return to France
The Exit Tax is not a tax on departure, but a deferral mechanism. It targets taxpayers who have been resident in France for at least 6 of the last 10 years and hold securities exceeding €800,000.
Managing the payment deferral
Support from Balmont Conseil makes it possible to:
- Calculate the latent capital gain precisely.
- File the appropriate forms (2074-ET) in order to benefit from the automatic payment deferral within the EU, or under guarantees towards third countries.
- Track the limitation period (2, 5 or 10 years depending on the case) so that the tax is definitively wiped out without ever being paid.
Anticipating the return: The Inbound Assignee Regime (Art. 155 B)
If you are planning a return, the expatriate tax status turns into an opportunity. The regime of Article 155 B allows a 50% exemption on the inbound-assignment bonus and on 50% of financial income from foreign sources. A windfall that is prepared before signing the employment contract in France.
The Balmont approach: Augmented engineering at the service of the non-resident
360° wealth audit
Delegated property management
Estate-planning vigilance
Non-Resident Taxation in 6 key points
Your wealth deserves a borderless vision
Being a non-resident offers exceptional opportunities for capital growth — provided you do not let non-resident taxation absorb your performance. At Balmont Conseil, we combine the expertise of Alexis Sagnier with technological power to secure every euro invested in France or internationally.
Do not let fiscal complexity curb your ambitions.
Book an appointment for a bespoke non-resident tax audit
Alexis Sagnier
With more than 17 years’ expertise in financial engineering, Alexis Sagnier supports company directors and expatriates in securing their cross-border interests.
Sources & References:
- General Tax Code (CGI): Art. 4B, 155 B, 167 bis, 244 bis A.
- Official Bulletin of Public Finances (BOFiP): RPPM and RFPI series.
- Regulation (EU) No 650/2012 (International successions).
- ANACOFI 2025 Member Handbook – Cross-border compliance standards.
- OECD Model Tax Convention.
- Yield SCPI comparison for expatriates: net-net return