the 183 days rule
French Tax Residency
In terms of french tax residency, there is a lot of divergent information circulating on the criteria for tax domicile in France.
The criterion of 6 months (183 days) minimum presence in France is often misused. Under French law, you are tax domiciled in France if your household is in France.
According to the French tax authorities, an individual’s home is his or her habitual and permanent place of residence. They will examine first and foremost the center of family interests. In other words, if your spouse or civil union partner and children are or remain in France, even if you have to stay in another country temporarily or for most of the year due to professional needs, the tax authorities will consider that your tax home is located in France.
Determining one’s tax residence allows one to know one’s tax regime in terms of income tax, inheritance tax, gift tax, or real estate wealth tax.
This is why it is essential that we define this notion together.
Article 4A of the French General Tax Code establishes an essential division around the notion of tax residence:
Individuals domiciled in France are subject to income tax on all their worldwide income,
Other individuals not domiciled in France are only taxed on their French source income.
It is therefore essential to know if your tax residence is in France or not.
How is your residence determined?
f you are unable to determine a household, the tax domicile is defined by your main place of residence. This is the place where the person has stayed the longest. Thus, if a person has stayed in France for more than 183 days during the same year, he or she automatically has his or her tax domicile in France.
Moreover, if the duration of the stay in France, even if it is less than 183 days, is longer than the duration of the stay abroad, the tax authorities will consider that the criterion of tax domicile is met.
Internally, whether you are French or not, the French tax authorities consider that your tax residence is in France if you meet one of the following criteria :
you have your home in France. If you do not have a home, your tax residence is defined by your main place of stay: To meet the criterion of main stay, you must stay more than 183 days on French territory;
you carry out your professional activity in France, whether you are employed or not, unless it is accessory;
you have the center of your economic interests in France. This is the place of your main investments, the seat of your business, the center of your professional activities, or the place from which you derive most of your income.
You only need to meet one of these criteria to be considered a French tax resident.
French tax residency : in the absence of being able to determine a home or main place of residence in France
The tax authorities examine the professional criteria. It will consider that you are domiciled in France for tax purposes if you carry out a professional activity in France, whether salaried or not, unless it is incidental;
Otherwise, if you have the center of your economic interests in France (your main investments, the headquarters of your business, the center of your professional activities, or the place from which you derive most of your income), the French tax authorities will consider you to be a French tax resident.
In other words, you are a French tax resident if you meet any of these criteria:
your home is in France
your main place of stay is in France
you have a non-ancillary professional activity in France
the center of your economic interests is in France
NB : You can be considered a tax resident of several countries at the same time. In the case of multiple tax residences, the application of possible international tax treaties will allow the avoidance of double taxation.