French exit tax when leaving with a substantial portfolio

No. It applies only if you were French tax resident for at least six of the ten years before leaving and your securities and company shares are worth more than €800,000, or you hold at least 50% of a company’s profits; securities held in a PEA or a PEA-PME are left out of the calculation. Earn-out receivables and gains already deferred before departure follow separate rules.

No, in most cases. Payment is deferred automatically if you move within the European Union, or to a state bound to France by administrative assistance and tax-recovery agreements that is not a non-cooperative state; elsewhere, deferral is granted on request, with a representative in France and guarantees equal to 12.8% of the gains concerned. The tax is then cancelled if you still hold the shares at the end of the holding period, which for a departure since 1 January 2019 is two years, or five years if your shares were worth more than €2.57 million on departure; for an earlier departure, the period in force when you left applies.

Not if you still held the shares when the relief period ended. For a departure since 1 January 2019, that period runs from the date of departure and lasts two years, or five years if your shares were worth more than €2.57 million in total on departure, and it ends earlier if you become French tax resident again. The tax calculated on departure on the rise in value of the shares is then cancelled, or refunded if it was paid, and the sale no longer falls under exit tax for that part. This relief does not cover earn-out receivables or gains deferred before departure, which follow their own rules. A sale before the period ends makes exit tax payable, in principle on the gain measured on departure, with relief for the part that exceeds the gain actually made. For an earlier departure, the period in force when you left applies; it was fifteen years just before the 2019 reform.

At least one return, the year after you leave: the gains and receivables concerned are declared with your income on form 2074-ETD (article 167 bis, IX.1). A return every year is then required only if your deferral covers an earn-out receivable or a gain already deferred before departure; it then also covers your unrealised gains (IX.2). The year after the deferral ends, after a sale for example, you declare the event and pay the tax due (IX.3). Missing any of these returns makes the deferred tax payable at once (IX.4), even if you file in your new country.