Changes to French Trusts: What You Need to Know

Following recent changes in French tax legislation, we understand that some UK resident Trusts may be required to report and pay tax in France.

  • DFK news
  • 16 August 2020

Following recent changes in French tax legislation, we understand that some UK resident Trusts may be required to report and pay tax in France.

Our DFK colleagues in France have explained that any trust with either of the following may be subject to the new rules:

•    French tax resident Settlor, Beneficiary or Trustee
•    Non-French tax resident Trusts which hold French stock market listed shares or bonds, property, or other rights located in France as at 1 January 2020. This could include investments held within an Investment portfolio (if you have a managed investment portfolio and you are not sure whether there are any French assets held within the portfolio, you should contact your investment manager as soon as possible to check)

If the Trust meets either of the above conditions, it may be deemed to have a French Nexus.
Trusts with a French Nexus may be subject to French taxation and may need to make an annual return to the French tax authorities. Failure to do so could attract significant penalties.

What next?
If you believe that you fall into either category, and you have not yet made a declaration in France, please contact the CBW tax team urgently. We will then be able to put you in touch with one of our DFK International colleagues in France who will be happy to help.

Author: Michaela Lamb

Author

CBW