TLDR: Private pensions from foreign sources received by taxpayers fiscally domiciled in France are subject to income tax withholding, unless exempt under an international tax treaty. The withholding is calculated on the net taxable amount, following the same rules as for French-source pensions. Foreign-source pensions are not subject to withholding tax if the debtor is based outside France.
Conditions for applying the withholding tax
Foreign-source private pensions are subject to income tax withholding if they are taxable in France. This also applies when pensions qualify for a tax credit equal to the foreign tax, except in cases provided for by international tax treaties.
Calculation of the withholding tax
The withholding tax is calculated on the net taxable amount of pensions, following the same rules as for French-source pensions. Pensions exempt from tax under domestic law, international tax treaties, or agreements are not subject to withholding.
Exceptions and special cases
Foreign-source pensions are not subject to withholding tax if the debtor is based outside France. However, they remain subject to the withholding tax. If an international tax treaty provides for a tax credit equal to the foreign tax, the pension remains subject to withholding in France.
Taxable base for the withholding tax
The taxable base for the withholding tax on foreign-source pensions consists of the net amount taxable under income tax. This means the same rules for determining taxable income apply as for French-source pensions.
Role of international tax treaties
International tax treaties may influence the application of the withholding tax. For example, if a treaty provides for tax exemption, the pension is not subject to withholding. If the treaty provides for a tax credit equal to the foreign tax, the pension remains subject to withholding in France.
Verification of taxability
French tax authorities may request additional information to verify the taxability of foreign-source pensions, particularly if the debtor is based in a state with which France has an administrative assistance agreement.
Tax treatment of foreign pensions
Foreign-source pensions are treated the same as French-source pensions unless an international agreement states otherwise. This means the same tax rules and withholding calculations apply.