Capital Gains Tax in France 2026: Rates, rules, and US expat obligations
Tax-year scope:
This guide focuses on French gains realized in 2025 and reported in 2026, while flagging material 2026 rule changes where they affect the answer. That distinction matters because France changed social levies on many securities gains while the standard French real-estate regime continues to use a 19% income-tax rate and, in the ordinary case, 17.2% social levies.
Capital gains tax in France: Quick answer guide for US expats (2025)
For 2025 French real-estate sales, the standard tax is 19% plus 17.2% social charges, before exemptions, holding-period reductions, or the separate surtax on taxable property gains above €50,000. US citizens must also calculate the transaction under US rules and report a taxable gain on Form 8949 and Schedule D.
France taxes an ordinary taxable property gain at 19%, but a US citizen must separately calculate and report the transaction for US federal tax purposes, normally through Form 8949 and Schedule D. French tax paid may support a Foreign Tax Credit, subject to US creditability and limitation rules.
For a broader US-side explanation, see TFX’s guide to capital gains for US expats.
For securities gains realized in tax year 2025, the French prélèvement forfaitaire unique (PFU) is 30% – 12.8% income tax plus 17.2% social levies. Starting from January 1, 2026, social levies on affected securities gains rise to 18.6%, producing a 31.4% PFU for gains realized in tax year 2026 and reported in 2027.
What is capital gains tax in France?
Capital gains tax in France applies to profits from disposals of assets including French real estate, shares, and other investments. For private real estate, France generally taxes the adjusted gain at 19%, with separate social charges and possible abatements based on ownership duration.
France imposes CGT, known as a tax on a plus-value, when an asset is disposed of for more than the applicable tax basis, but the rate and relief rules depend on the type of asset.
The mechanics differ sharply between a plus-value immobilière on real property and France's capital gains tax on investments such as listed securities. TFX explains the parallel US treatment in its guide to capital gains tax on foreign property.
A US citizen or green card holder can have two calculations for the same transaction. French law determines the French taxable gain, while the US calculation uses US basis, holding period, foreign-currency, and reporting rules.
What is the CGT in France? CGT in France is not one single rate. A 2025 private property gain generally starts with a 19% French income-tax component, while securities gains follow the rules for financial gains and can fall under the PFU regime.
Does France have capital gains tax? Asset types covered
Yes. France taxes gains across several asset classes, but the rules are not interchangeable: a French home, listed stock, cryptocurrency, and a business interest can each produce a different tax calculation. For 2025–2026, the applicable rate can range from asset-specific exemptions to a 30% PFU on 2025 securities gains, rising to 31.4% for gains realized from January 1, 2026.
The following 5 broad asset categories can fall within French capital-gain or equivalent gain-taxation rules:
- Real estate – houses, apartments, land, and certain interests in property-rich entities.
- Listed and unlisted securities – shares and similar financial interests.
- Business assets or ownership interests – with separate regimes depending on structure and circumstances.
- Digital assets – private cryptocurrency gains have their own French calculation and reporting rules.
- Certain investment and insurance products – treatment depends on the product and how the gain arises.
US holders of digital assets should also review TFX’s guide to reporting cryptocurrency transactions on a US tax return.
A US expat capital gains analysis should identify the asset first. The words “capital gain” do not tell you whether French real-estate abatements, securities PFU rules, business provisions, or digital-asset rules govern the transaction.
Capital gains tax rates in France: Property, shares, and more
The capital gains tax rate in France depends on the asset and the year of disposal. A typical 2025 private French property gain uses 19% income tax plus 17.2% social levies, while social levies rise to 18.6% (31.4% PFU total) for securities gains realized from January 1, 2026.
For 2025–2026, do not use one headline French rate for every asset: ordinary real property remains under the 19% plus 17.2% regime, while affected securities gains carry a 17.2% social-levy component.
| Asset type | French income-tax / CGT rate | Social charges | Headline combined rate | Notes |
|---|---|---|---|---|
| Private French real estate – standard case | 19% | 17.2% | 36.2% | Before holding-period abatements and possible >€50,000 surtax |
| Securities gains subject to PFU | 12.8% | 17.2% | 30% | For gains realized in tax year 2025; social levies rise to 18.6% (31.4% total) for gains realized from January 1, 2026. |
| Qualifying nonresident French property seller covered by EEA/Swiss social-security exemption | 19% | 7.5% solidarity levy | 26.5% | Conditions must be satisfied |
| Third-country nonresident French property seller | 19% | 17.2% | 36.2% | US residents commonly fall in this category |
France’s tax authority confirms that third-country nonresidents generally pay the 17.2% social levy on French real-estate gains, while qualifying EEA/Swiss taxpayers – and qualifying UK residents under the post-Brexit rule described by the administration – can be exempt from CSG and CRDS but remain subject to the 7.5% solidarity levy.
For US treatment of gains and losses, see TFX’s capital gains and losses tax guide.
Capital gains tax in France on property (plus-value immobilière)
Capital gains tax in France on property starts with the sale proceeds and adjusted acquisition cost, then applies qualifying costs and holding-period abatements. France permits a 7.5% acquisition-cost forfait in specified circumstances and, for property held more than 5 years, a 15% improvement-cost forfait when the relevant conditions are met.
The following 5 steps describe the standard calculation for a private French property disposal:
- Determine the sale price. Use the amount stated in the deed, adjusted for qualifying seller-paid sale costs where the French rules permit.
- Determine the acquisition price. Add eligible acquisition expenses. If qualifying actual costs cannot be substantiated, French rules permit a 7.5% forfait based on purchase price.
- Add qualifying improvement expenditure to basis. For property owned for more than 5 years, a 15% purchase-price forfait can be available in place of documented qualifying work.
- Apply holding-period abatements. The income-tax and social-charge bases decline at different rates.
- Apply the applicable taxes. The ordinary income-tax component is 19%, social levies are calculated separately, and a taxable real-estate gain above €50,000 can also trigger the high-value gain surtax.
The 7.5% and 15% French forfaits increase the acquisition basis rather than directly reducing the tax rate, so their effect depends on the property’s purchase price, holding period, and final taxable gain.
For another property-basis issue, review TFX’s guide to capital gains tax on gifted property. US taxpayers should separately establish their federal basis under US rules; the IRS describes the basis principles for a home sale in its official property basis and home-sale guidance.
France capital gains tax holding period allowance: How abatements work
The French capital gains tax holding period allowance eliminates the 19% property income-tax component after 22 years and eliminates the ordinary social-levy component after 30 years. The two bases decline at different speeds, so a property can be free of the 19% tax while social charges remain payable.
A French property held beyond 22 years can be fully exempt from the 19% income-tax portion, but the standard social-charge exemption requires 30 years of ownership.
| Completed ownership period | Income-tax abatement | Social-charge abatement |
|---|---|---|
| Years 1–5 | 0% | 0% |
| Each year 6–21 | 6% per year | 1.65% per year |
| Year 22 | 4% | 1.60% |
| Each year 23–30 | Fully exempt from 19% tax | 9% per year |
| After 30 years | Fully exempt | Fully exempt |
The capital gains tax France holding period discount therefore has two tracks rather than one. A seller at year 22 may have no 19% French income-tax charge on the property gain but still have a social-charge base.
Selling property in France: Principal residence exemption
A French residence that is the seller’s habitual and effective main home can qualify for a full French exemption from the private real-estate capital-gain charge. A US citizen must still perform a separate US analysis because IRC Section 121 has its own ownership-and-use tests and maximum exclusion amounts.
For US federal purposes, Section 121 can exclude up to $250,000 of qualifying gain for many single filers and up to $500,000 on a qualifying joint return, generally using a 2-out-of-5-year ownership and use test.
The principal residence exemption France applies under French domestic rules and does not automatically establish the US result. A gain can therefore be exempt in France but partly taxable in the United States.
For related basis and property-sale issues, see TFX’s guide to capital gains on inherited property.
Capital gains tax in France on shares and financial investments
Capital gains tax in France on shares changed materially for the 2025 filing cycle. Current French guidance states that securities gains realized from January 1, 2025 can fall under a 31.4% PFU, made up of 12.8% income tax and 18.6% social levies, rather than the former 30% total.
For affected securities gains realized in 2025, the current official French rate is 31.4%.
The following 4 features matter when applying French capital gains tax on investments:
- PFU is the default regime for qualifying private securities gains.
- A global election for the progressive income-tax scale may be available instead of the flat 12.8% income-tax component.
- Holding-period abatements are restricted, including rules tied to securities acquired or subscribed before January 1, 2018.
- The legal character of the security matters, particularly for interests connected with property-rich entities or special regimes.
The phrase capital gains tax France stocks therefore covers rules distinct from the real-estate system. The IRS separately explains US treatment of stock transactions in its official stocks, options, splits, and traders guidance.
Capital gains tax in France for non-residents
Capital gains tax in France for non-residents can apply even when the seller lives permanently outside France. A non-resident selling taxable French real estate generally faces the 19% French income-tax rate, while the social-charge rate depends on the seller’s residence and social-security position.
The following 3 nonresident rules are especially important:
- A resident of a third country outside the EU, EEA, or Switzerland generally faces 17.2% social levies on the French property gain.
- A qualifying person covered by another EEA or Swiss compulsory social-security system can be exempt from CSG and CRDS while remaining liable for the 7.5% solidarity levy. French guidance also preserves this treatment for qualifying UK residents.
- A fiscal representative can be required for non-EU sellers, but automatic exemptions apply in specified cases, including where the sale price is €150,000 or less per seller or the gain has become fully exempt by the 22-year/30-year holding rules.
A France capital gains tax non-resident analysis must therefore distinguish tax residence from nationality. A US citizen resident in France and a US citizen resident in the United States can face different French social-charge outcomes on an otherwise similar sale.
For the US side, TFX explains when nonresidents can owe US capital gains tax.
Capital gains tax France: Second home and vacation property
A French second home normally does not qualify for the principal-residence exemption. For a standard 2025 sale, capital gains tax France second home treatment can therefore include the 19% property tax, 17.2% social levies, holding-period abatements, and potentially the surcharge on taxable real-estate gains above €50,000.
A French vacation property becomes fully exempt from the 19% income-tax component after the required 22-year holding period, while the ordinary social-charge exemption takes 30 years.
Selling property in France capital gains tax treatment does not end the US analysis. A US citizen selling a second home generally reports the transaction under US capital-gain rules, and Section 121 normally will not protect a property that does not satisfy the US principal-residence requirements.
The gain must also be computed in US dollars for the federal return. Changes in the EUR/USD rate between acquisition and disposition can make the US dollar gain differ from the French euro-denominated gain.
How to calculate capital gains tax in France: Worked example
To calculate a standard French private-property gain, first establish the adjusted French acquisition basis, then apply the separate holding-period abatements for income tax and social charges. In this illustration, a property bought for €200,000, held for 10 years, and sold for €320,000 starts with a €120,000 gross gain.
Based on our client scenario at TFX: A US citizen bought a French apartment for €200,000, held it for 10 completed years, and sold it for €320,000. Assume the taxpayer is entitled to use both French forfaits and is subject to the standard 17.2% social-charge rate.
The following 7 calculation steps apply:
- Gross gain: €320,000 − €200,000 = €120,000.
- 7.5% acquisition-cost forfait: €200,000 × 7.5% = €15,000.
- 15% improvement forfait: €200,000 × 15% = €30,000.
- Gain before holding-period abatements: €120,000 − €15,000 − €30,000 = €75,000.
- Income-tax abatement: Five completed years beyond year 5 × 6% = 30%; €75,000 × 70% = €52,500 taxable base. The 19% charge is €9,975.
- Social-charge abatement: Five × 1.65% = 8.25%; €75,000 × 91.75% = €68,812.50. At 17.2%, social charges are approximately €11,835.75.
- High-value real-estate gain surtax: Because the income-tax taxable gain is €52,500, the separate surtax rules must also be checked. Under the €50,001–€60,000 formula, the surcharge is approximately €675 in this scenario.
That puts the illustrative French charge at approximately €22,485.75, before any other fact-specific adjustments.
The holding-period abatements and permitted basis additions reduce the effective French rate below the raw 36.2% headline rate, but the €50,000 surtax threshold can add tax back into a property-sale calculation.
For US reporting, the acquisition and sale figures must also be translated into dollars under appropriate exchange-rate conventions. TFX explains the separate annual-rate issue for account reporting in its FBAR exchange-rate guide, but a property gain should not be calculated by converting one finished euro gain using an FBAR year-end rate.
Get US reporting help for a French property sale
Selling French property can create at least 2 separate tax calculations – one under French law and one for the US return. TFX can assist with the US reporting of the transaction, including the relevant capital-gain and foreign-tax-credit forms.
US–France tax treaty and capital gains: Article 13 explained
Article 13 of the US–France income tax treaty permits France to tax specified gains connected with French real property, while the United States generally continues to tax its citizens on worldwide income. For a US citizen, relief commonly depends on the Foreign Tax Credit and Article 24 coordination rules, not on making the French gain disappear.
The following 4 treaty points matter for US-France tax treaty capital gains:
- France can tax gains from real property situated in France.
- Article 13 also contains rules relevant to interests in entities whose assets consist principally of real property.
- The treaty’s saving-clause structure preserves substantial US taxing rights over US citizens.
- Double-tax relief must then be analyzed under the treaty and US Foreign Tax Credit rules rather than assumed from Article 13 alone.
TFX’s US–France tax treaty guide explains the treaty in a broader expat context.
The US- France tax treaty Article 13 capital gains rules therefore do not mean a French property sale is taxable in only one country. A double taxation treaty analysis for France has to determine which country taxes the gain first for credit-relief purposes and whether the French levy satisfies US foreign-tax-credit rules.
Investors using cross-border ownership structures should also review TFX’s discussion of US tax forms for foreign and US property investors.
Reporting French capital gains on your US tax return
A US citizen generally reports a taxable French asset sale under the same federal capital-gain system used for other capital assets. For a French property transaction, Form 8949 and Schedule D are normally central, while Form 1116 can apply if qualifying French tax is available as a Foreign Tax Credit.
The following 5 US reporting steps cover the standard workflow:
- Translate the transaction into US dollars. Translate acquisition basis using the relevant acquisition-date rate and sale proceeds using an appropriate sale-date rate or another consistently applied IRS-acceptable convention. Do not simply calculate one euro gain and translate it once.
- Report the disposition on Form 8949 when that form is required, classifying the gain as short-term or long-term under US law.
- Carry the Form 8949 totals to Schedule D.
- Calculate any available Foreign Tax Credit on Form 1116, subject to the creditability, source, category, and limitation rules.
- Check separate foreign-account disclosures. French bank or brokerage accounts holding the proceeds can affect FBAR or Form 8938 obligations.
TFX’s foreign financial asset disclosure guide explains how the asset-reporting forms interact.
A Form 8949 French property calculation may differ substantially from the French notarial calculation because basis additions, holding-period relief, and currency translation do not necessarily match. The same difference flows through Schedule D foreign capital gains reporting.
Foreign Tax Credit vs. Foreign Earned Income Exclusion for French CGT
The Foreign Earned Income Exclusion does not exclude a French capital gain because capital gain is not foreign earned income for Form 2555 purposes. The main US mechanism for potentially relieving double taxation on qualifying French CGT is instead the Foreign Tax Credit on Form 1116, subject to its statutory limitations.
A foreign tax credit calculation for France is not automatically dollar-for-dollar in every case. Form 1116 limits the credit by foreign-source income category and US tax attributable to that category, so timing, source, and the character of the French levy matter.
The IRS also states that it will not deny a credit for French CSG and CRDS merely because of the US–France Social Security Agreement. Those payments still have to satisfy the ordinary US rules for a creditable foreign tax.
Unused qualifying foreign tax in a category that permits carryovers can generally be carried back 1 year and forward 10 years under the 2025 Form 1116 instructions.
FBAR and FATCA compliance when selling French assets
Selling French property does not make the property itself an FBAR account, but sale proceeds deposited into a French account can create or increase foreign-account reporting obligations. An FBAR is required when aggregate reportable foreign financial accounts exceed $10,000 at any point during the calendar year.
The following 4 disclosure checks should be made after a French asset sale:
- FBAR France: determine whether the combined maximum value of reportable foreign financial accounts exceeded $10,000.
- FATCA compliance France: check whether Form 8938 applies based on filing status, residence abroad, and year-end or maximum specified foreign financial assets.
- Directly owned real property: the building itself is generally not a foreign financial account merely because it is located in France.
- Sale proceeds: once cash moves into a French bank or brokerage account, the account can count toward the applicable reporting thresholds.
For FBAR mechanics, use TFX’s detailed FBAR filing guide.
For Form 8938, taxpayers living abroad generally face higher thresholds than US residents. Depending on filing status, the foreign-living thresholds can reach $300,000 for an unmarried or married-filing-separately taxpayer and $600,000 for a joint return. Failure to file Form 8938 can start with a $10,000 penalty and rise after continued noncompliance following IRS notice.
TFX’s guide to FATCA noncompliance penalties provides the penalty context.
France exit tax on capital gains upon emigration
France’s exit tax can apply when a person who has been a French tax resident for at least 6 of the previous 10 years transfers tax residence abroad and holds qualifying securities worth at least €800,000 or representing at least 50% of a company’s profit rights. The regime can tax unrealized gains.
The France exit tax emigration capital gains rules focus primarily on qualifying securities, deferred gains, and specified receivables rather than ordinary household property. The €800,000 and 50% tests make asset ownership immediately before departure central to the analysis.
Deferral rules depend on the destination country and France’s administrative-assistance and collection relationships with that jurisdiction. A move outside the EU does not automatically mean immediate payment in every case, so the destination-country rules need to be checked before departure.
TFX’s France exit tax guide for US expats covers the broader US-expat context.
French social charges (prélèvements sociaux) on capital gains
For standard 2025 private real-estate gains, French social charges remain 17.2% before applicable holding-period abatements. The rate is separate from the 19% French property income-tax component, which is why the familiar unadjusted combined property rate is 36.2%.
French social charges do not produce identical results for every nonresident. Qualifying taxpayers insured under another EEA or Swiss compulsory system can be relieved from CSG and CRDS on French real-estate gains while remaining liable for the 7.5% solidarity levy; French guidance extends the described relief to qualifying UK residents.
The US credit issue must be examined separately. The IRS specifically states that French CSG and CRDS are not treated as social-security taxes covered by the bilateral totalization agreement for this purpose, removing that agreement as a basis for denying the credit, but ordinary Foreign Tax Credit requirements still apply.
Capital gains tax changes in France: Recent developments
France capital gains tax changes affecting 2025–2026 include a higher social-levy rate on many securities gains and a change to the French gain calculation for certain furnished rentals. These are substantive differences, not merely proposed measures, so older articles quoting a universal 30% PFU can now be out of date.
For securities, current French guidance gives a 31.4% PFU for affected gains: 12.8% income tax plus 18.6% social levies.
French rules for certain location meublée non professionnelle property sales also changed in 2025. For affected LMNP dispositions, depreciation previously deducted can now reduce the acquisition-price component used in the capital-gain calculation, subject to statutory exceptions, potentially increasing the taxable gain.
The ordinary private real-estate regime remains distinct. French tax guidance continues to show 19% plus 17.2% for the standard private-property calculation, with the 22-year and 30-year abatement schedules.
Currency exchange gains and French property: USD reporting pitfalls
US reporting requires the French property transaction to be measured in US dollars, which can make the federal gain different from the euro gain used in France. A taxpayer who owned the property for 10 or 20 years can therefore see a material difference solely because the acquisition and sale occurred at different exchange rates.
The following 3 currency points matter for a foreign property disposal:
- Convert the acquisition-side basis components using appropriate rates for the dates those dollar-basis amounts arose.
- Convert sale proceeds using an appropriate transaction-date rate or consistently applied IRS-acceptable rate.
- Do not assume that converting the final French euro gain at one annual-average rate produces the correct US capital gain.
This is why currency exchange gain taxation needs fact-specific treatment. Foreign-currency movements can change the dollar-denominated gain even where the underlying euro property appreciation is unchanged.
For property context, see TFX’s guide to French property tax for nonresidents. The IRS separately explains federal treatment of losses on personal-use and investment property in its official guidance on losses from homes, stocks, and other property.
Catch up on unfiled US returns with French capital gains
A US expat who omitted French investment income or a property gain from prior returns may qualify for the Streamlined Foreign Offshore Procedures if the failures were non-willful and the nonresidency requirements are met. Eligible filings generally cover 3 years of returns and 6 years of delinquent FBARs.
Qualifying Streamlined Foreign submissions are not subject to the specified failure-to-file, failure-to-pay, accuracy-related, information-return, or FBAR penalties, although tax and interest remain due. This should not be confused with the domestic streamlined program, which has different rules and a 5% miscellaneous offshore penalty.
US residents considering that domestic route can review TFX’s guide to Streamlined Domestic Offshore Certification and Form 14654.
Frequently asked questions
For ordinary private French real estate, the headline 2025 rate is 19% plus 17.2% social levies, before abatements and any >€50,000 high-value-gain surtax. For securities gains realized in tax year 2025, the applicable PFU is 30% (12.8% income tax plus 17.2% social levies). Social levies on affected securities gains rise to 18.6% – a 31.4% PFU total – for gains realized from January 1, 2026.
Yes. France's capital gains tax for non-residents generally applies to taxable French real estate at 19%, with social charges determined separately. Third-country residents commonly face 17.2%, while qualifying EEA/Swiss and certain UK residents can receive CSG/CRDS relief and pay the 7.5% solidarity levy instead.
For ordinary French private real estate, the 19% income-tax portion becomes fully exempt after 22 years, while the standard social-charge liability is fully eliminated after 30 years. That abatement duration ownership rule is why the sale date can materially change the French tax calculation.
Not automatically. The US France tax treaty allows France to tax qualifying gains connected with French real estate, while US citizens remain subject to US taxation under the treaty’s saving-clause structure. Relief is commonly sought through Article 24 and the Foreign Tax Credit rather than through a blanket exemption.
A credit is different from a deduction. The IRS states that it will not challenge a Foreign Tax Credit for French CSG or CRDS solely on the basis of the US–France Social Security Agreement, but the tax still has to satisfy the normal Form 1116 creditability and limitation requirements.
A US citizen generally must calculate the disposition under US tax rules even when France already taxed it. Form 8949 French property reporting can flow to Schedule D, while eligible French tax may be considered on Form 1116. Paying France does not replace the US reporting obligation.
The French exit tax can apply to unrealized gains when a qualifying French tax resident moves abroad. Current rules include a 6-of-10-year prior residency test and asset thresholds such as an aggregate qualifying portfolio above €800,000 or a 50% profit-rights interest.
A typical US filing can involve Form 8949, Schedule D, and Form 1116. FinCEN Form 114 may also be required if foreign financial accounts exceed $10,000 in aggregate, while Form 8938 depends on separate FATCA thresholds. TFX’s guide to accounts and FATCA reporting exceptions provides additional context.
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