Lobe Law stands out for its recognised expertise in international tax matters, offering comprehensive assistance to both individuals and businesses. With its specialist expertise, Lobe Law offers personalised, strategic advice on navigating the complex international tax landscape.
Whether you are an individual looking to optimise your international tax position, a business looking to understand and comply with cross-border tax regulations, or dealing with specific issues such as international donations, Lobe Law provides tailor-made support and in-depth expertise.
Lobe Law's commitment to excellence and in-depth knowledge of evolving international tax regulations positions it as a trusted partner for those seeking to maximise their tax benefits while remaining compliant with current laws and regulations.
To prevent the same income from being taxed twice, the tax treaty between France and the country concerned must be reviewed. The treaty determines which state is entitled to tax each category of income and generally provides a mechanism for eliminating double taxation. Depending on the applicable treaty, this may involve an exemption or a tax credit equal to the foreign tax paid or to the corresponding French tax. The income may still have to be reported in France, even where an exemption or tax credit ultimately applies.
Tax residence is not determined solely by the number of days spent in a country. Under French domestic law, the relevant factors include the location of the individual’s household or main place of residence, their principal professional activity and the centre of their economic interests. An individual may sometimes be treated as a resident by two countries under their respective domestic laws. In that situation, the applicable tax treaty provides criteria for resolving the dual-residence conflict, which take precedence over domestic rules.
The taxation of foreign income depends on the taxpayer’s residence, the nature and source of the income and the relevant tax treaty. A French tax resident is generally required to report worldwide income. The treaty may then provide an exemption, the effective tax rate method or a foreign tax credit. Salaries, dividends, property income, business profits and capital gains may each be subject to different rules. When foreign income must be reported in France, the taxpayer may notably be required to complete French tax form no. 2047.
An international tax lawyer reviews French tax law, the relevant foreign rules and the tax treaty applicable to the client’s circumstances. The lawyer may determine how income or assets connected with several countries should be treated, review reporting obligations and anticipate the consequences of a cross-border transaction. Advice may be provided to individuals and companies in relation to international investments, gifts, professional mobility or corporate reorganisations. This assistance helps secure the proposed strategy while ensuring compliance with the applicable domestic and international tax rules.
Expatriation may change an individual’s tax residence and the scope of income remaining taxable in France. For the year of departure, French-source and foreign-source income received before the departure date must be reported, together with any French-source income remaining taxable after that date. Individuals holding certain shares, earn-out receivables or capital gains subject to tax deferral may also fall within the scope of the French exit tax. The consequences depend on the destination country, the assets and income retained in France and the relevant tax treaty.
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