Leaving France for Hong Kong: tax residency, exit tax, and what the agreement changes

Moving to Hong Kong only terminates French tax residency if none of the three criteria in Article 4 B of the French General Tax Code (CGI) are met. If you hold significant securities, exit tax may apply: Hong Kong is not included in the list of automatic deferrals listed in form 2074-ETD for transfers in 2025. Between France and Hong Kong, an agreement signed in 2010 distinguishes between residency and habitual residence, adding nationality for France or the right of residence for Hong Kong. Pensions are taxable in the country of origin.

Leaving French tax residence: only one criterion is needed to remain there.

The tax authorities (BOI-IR-CHAMP-10) establish three alternative criteria: the principal residence or place of residence, the primary professional activity carried out in France, and the center of economic interests. The tax authorities state: "It is sufficient for one of these criteria to be met." The principal residence generally corresponds to more than six months of the year, but this rule is not absolute. Maintaining a residence in France, a primary activity, or one's principal investments may therefore be sufficient to remain domiciled in France, regardless of the number of days spent in Hong Kong.

Exit tax: Hong Kong is not included in the automatic deferral list

The exit tax imposes unrealized capital gains on securities upon transfer of tax residence. Two conditions: having been domiciled in France for at least six of the ten previous years, and holding securities worth at least €800,000 (the notice states "greater than", the information sheet "at least": the threshold is verified) or at least 50% of the social profits of a company.

The 2074-ETD notice lists, for transfers since January 1, 2025, the non-EU countries for which payment deferral is automatic. Hong Kong is not included (case no. 1 of § A). Outside this list, the tax is generally immediately due, unless a deferral is requested: a 2074-ETD declaration is filed "within ninety days preceding the transfer" according to the notice ("no later than 90 days before" according to the information sheet), a tax representative established in France is required, and guarantees are in place. This notice applies to transfers in 2025; for a departure in 2026, the applicable notice should be consulted.

The tax relief is granted after 2 years (if the value of the shares is less than €2,570,000) or 5 years (if it is more), provided you have not sold, repurchased, or cancelled your shares, and if the company is not in liquidation. Details can be found on our exit tax page and on our forms page.

What the 2010 agreement changes for a departure

The France-Hong Kong agreement is detailed on our dedicated page. Four of its rules apply from the date of departure.

• Residence (Article 4 § 2). If both territories consider you a resident: first, your permanent home, then your center of vital interests, then your habitual residence, then your nationality (France) or right of residence (Hong Kong), and finally, the agreement of the authorities. The concept of resident status as defined by the agreement takes precedence over your internal tax domicile.
• Pensions (Article 17). They are taxable in the country where they originate. A pension paid by a fund recognized or regulated by France is considered to be of French origin. Our page on French retirement pensions for non-residents provides further details.
• Participation of 25 % or more (article 13 § 3). Capital gains on shares in an interest entitling the holder to 25% or more of the profits are taxable in the state of the company. Capital gains on all other assets are taxable only in the state of the transferor (§ 5).
• Salaries (Article 14 § 2). The threshold of 183 days in any twelve-month period is one of the conditions for an exception to taxation in the state where the employment is performed.

What France continues to impose after departure

Non-residents are generally not taxed in France on capital gains from the sale of securities (Article 244 bis C of the French General Tax Code). The exception applies to those who, along with their family group, have held more than 25% of the rights to profits from a company subject to corporate income tax and headquartered in France at any point during the last five years: the tax is levied at 12.8%, increased to 75% for individuals domiciled in a non-cooperative state or territory. According to impots.gouv.fr, investment income of a non-resident is not subject to social security contributions; withholding tax applies to dividends. This tax administration page was modified on July 4, 2022: do not infer any tax rates from it.

The year of departure: one or two statements

Form 2042 reports your income from January 1st to your departure date. Foreign-source income received during this period should be declared on form 2047. Form 2042-NR reports, from your departure date to December 31st, only French-source income taxable in France. If you still have such income, the Non-Resident Tax Office will be your tax administrator. Update your address in your online account.

On the Hong Kong side: residence, stay and permits

Residence. The agreement protocol defines a resident as someone who stays in Hong Kong for more than 180 days during a tax year, or more than 300 days over two consecutive tax years, including the year in question. The tax year begins on April 1 and ends on March 31. The IRD page on the automatic exchange of information uses the same threshold.

Stay. According to the French consulate in Hong Kong, French citizens are not required to have a visa for stays of three months or less; the passport must be valid for one month after the end of the planned stay; the tourist visa does not allow the holder to study or work; a work visa must be requested before arrival.

Long-term securities. The Hong Kong Immigration Department publishes three avenues which we relied on:

• the «New Capital Investment Entrant Scheme»: net assets of at least HK$ 30 million and investment of at least HK$ 30 million in eligible assets; initial stay of no more than 24 months, extensions of no more than three years; ;
• the «Top Talent Pass Scheme» (category A): annual income of at least HK$ 2.5 million in the year preceding application, initial stay of 36 months; approval is entirely discretionary and the page does not say whether the scheme is open today; ;
• The "General Employment Policy": real job offer, appropriate training, market-competitive remuneration.

These pages do not have a legible revision date, only a footer. They should be checked before any project.

An arrival in October or November: a numerical example (fictitious profile)

Situation. A fictional entrepreneur from Lyon moves to Hong Kong on October 1, 2026. Another entrepreneur, with the same profile, arrives on November 1, 2026.

Issue. They want to know if they are residents of Hong Kong from the first year of taxation within the meaning of the protocol of the agreement.

Strategy. They count their days in the 2026/27 tax year (from April 1, 2026 to March 31, 2027) and compare to the 180-day threshold.

Result. Arriving on October 1st, the first individual spends 182 days in the 2026/27 tax year: the threshold of more than 180 days is exceeded by 2 days. Arriving on November 1st, the second individual spends 151 days: the threshold is not reached that year. With a full 2027/28 tax year of 366 days (including February 29, 2028), this would total 517 days over two consecutive years, exceeding 300. This calculation does not take into account French tax residency, which is assessed separately, nor Hong Kong tax.

What changes depending on your situation

• The date of the transfer and the value of your securities on that date.
• The location of your home, your main occupation, and your economic interests.
• Your residency rights in Hong Kong and your nationality.
• The nature of your income: pensions, dividends, gains, salaries.
• A previous contribution-sale, which modifies the analysis of the departure.

These points are examined on a case-by-case basis. No tax results can be announced without this review.