TLDR: In France, an individual is a tax resident if they have their home or main place of stay in the country, carry out their main professional activity there, or have the center of their economic interests there. International tax treaties may override this rule, particularly in cases of dual residency, where hierarchical criteria (permanent home, center of vital interests, habitual abode, nationality) determine the single residency. Residency is assessed individually, not per tax household.
National tax residency criteria
Under French domestic law, Article 4 B of the Code général des impôts (CGI) defines three alternative criteria for establishing an individual’s tax residency:
- Having their home (family nucleus) or main place of stay in France;
- Carrying out a professional activity in France, whether employed or self-employed, unless the activity is secondary;
- Having the center of their economic interests in France.
These criteria are cumulative: satisfying just one is sufficient to be considered a tax resident in France.
Primacy of international tax treaties
Bilateral tax treaties may take precedence over national criteria. If an individual meets the conditions of Article 4 B of the CGI but, under a treaty, is not considered a tax resident in France, the treaty provisions apply. Tax residency is then assessed at the individual level, not at the tax household level.
Resolving dual residency conflicts
In cases of dual residency, tax treaties provide a hierarchy of criteria to determine the single tax residency:
- Permanent home: any dwelling available to the person on a lasting basis, regardless of its legal nature;
- Center of vital interests;
- Habitual abode;
- Nationality.
If these criteria do not resolve the issue (e.g., dual nationality, statelessness), the individual may use the mutual agreement procedure so that the competent authorities of the relevant States can reach an agreement.
Treaty definition of residency
An individual is considered a resident of a State if, under that State’s legislation, they are liable to tax there by reason of their domicile, residence, place of management, or any other similar criterion. Individuals who are liable to tax solely on income from local sources or on property located in that State are not considered residents. Similarly, individuals exempt from tax due to their status or activity are not considered subject to tax for treaty purposes.
Special cases and exclusions
Company directors whose business is headquartered in France and generates an annual turnover exceeding €250 million are presumed to carry out their main professional activity in France, unless proven otherwise. This presumption also applies to companies controlling other companies under the conditions set out in Article L. 233-16 of the Code de commerce.
Limits and clarifications
Tax residency criteria do not automatically apply if an international double taxation treaty establishes that the individual is not a resident in France. Additionally, tax residency is determined individually, even within the same family household.