Valley International / pensions

UK pensions and SIPPs once you are tax resident in France

The UK to France route is the oldest expatriate path in Europe, and pensions are where it goes wrong most often. The mistakes are made early, usually in the first year, and they are rarely reversible.

Once you are tax resident in France, a UK pension is allocated by the France-United Kingdom double tax convention of 19 June 2008, whose pensions provisions distinguish private pensions from those paid for service to a state or local authority, and treat lump sums separately again. Private company and personal pensions are generally taxable in France; pensions paid in respect of government service usually remain taxable in the United Kingdom, though they may still be counted in France for rate purposes. A single household with one corporate pension and one civil-service pension is therefore taxed under two different rules at once, and the split has to be established from the scheme documents rather than inferred.

The type of scheme decides what can move

This distinction decides more than any tax question. A defined contribution pot, including a SIPP or a personal pension, is a sum of money that belongs to you and can in principle be moved. A defined benefit or final salary scheme is a promise: an income for life, usually escalating, generally with a survivor's benefit. Converting the second into the first exchanges a guarantee for a market exposure, and it cannot be undone. UK regulation reserves that analysis to an authorised adviser for schemes above a threshold set by UK law, and in practice the analysis concludes against transferring far more often than not.

The state pension follows its own logic entirely. It cannot be transferred anywhere, it is paid abroad, and its annual uprating depends on the arrangements between the United Kingdom and your country of residence rather than on your own contribution record.

The lump sum that France does not recognise

UK pension rules allow part of a pot to be taken as a lump sum free of UK tax. France has no equivalent concept, and the French treatment of that payment is not settled by the fact that the United Kingdom exempted it. Depending on how the payment is characterised, it may fall to be taxed as a pension under article 79 of the French tax code, or it may qualify for the flat-rate levy of article 163 bis, which applies only on express and irrevocable election and only where two conditions are met together: the payment is not made in instalments, and the contributions were deductible from taxable income, or attached to income exempted in the state where the beneficiary was then domiciled. Where neither route applies, the sum follows the ordinary income tax scale, possibly with the smoothing mechanism of article 163-0 A.

The practical consequence is uncomfortable but simple: the decision to take a tax-free lump sum should be taken before instructing the scheme, not after receiving the money. Once paid, the characterisation is fixed by facts you can no longer change.

QROPS, seen from France rather than from a brochure

A Qualifying Recognised Overseas Pension Scheme is a non-UK scheme that HMRC accepts as able to receive a transfer from a registered UK scheme without that transfer being treated as an unauthorised payment. HMRC publishes a list of schemes that have told it they meet the conditions. That list is information, not approval: it does not amount to verification, and responsibility for checking rests with the member. A scheme can leave the list, and a transfer to a non-qualifying scheme becomes an unauthorised payment taxed as such.

For a resident of France the honest answer is usually that there is nothing to gain. No French retirement vehicle appears on the HMRC list as available for this purpose, so the products marketed to this audience sit in third jurisdictions, most often Malta and Gibraltar. That adds a third legal system and a second layer of charges to a file that already has two of each. The UK also applies a flat charge to certain overseas transfers, whose rate and exclusions are set by UK finance legislation and were materially changed in 2024, which is why most notes still circulating on this subject are out of date.

What has to be reported, whatever you decide

A UK pension arrangement held by a French resident may fall within article 1649 A of the French tax code if it takes the form of an account held abroad, or within article 1649 AA if it is analysed as a capitalisation contract or similar investment taken out with a provider established outside France. The fine for an unreported bank account under article 1736 IV is €1,500 per account per year, and it applies whether or not anything was drawn. The characterisation is done on the scheme's own documents; a SIPP and a trust-based occupational scheme do not necessarily land in the same place. Reporting foreign accounts, contracts and trusts in France sets out the four separate obligations in full. The wider changes Brexit made to what still works for a British portfolio are covered in UK nationals in France: after Brexit, the map changed.

ÉTHIQUE ET PATRIMOINE, a French simplified joint-stock company (SAS), registered office at 41 rue Saint-Ferdinand, 75017 Paris, France, Paris Trade Register no. 803 414 796, VAT no. FR 40 803 414 796, registered with ORIAS under number no. 24001817 (www.orias.fr) — Financial investment adviser (CIF) no. 18002418, member of ANACOFI-CIF, a professional association approved by the Autorité des marchés financiers, and Anacofi-Courtage for its brokerage activity. Presence: Paris, Montpellier, Singapore, Hong Kong, Bangkok, Shanghai and Dubai.

Written by Stéphane Molère, Président d'Éthique et Patrimoine — page last reviewed on 2026-08-30 — rules quoted are those in force at that date.