Reporting obligation.

Article 1649 A of the French General Tax Code (CGI) requires French residents to declare bank accounts opened abroad.

Failure to declare the account may result in a fine of €1,500 (article 1736 of the CGI).

This declaration must be made at the same time as the tax return.

If there is a foreign bank account, it is likely that income is paid into it.

Foreign income must be declared in France by French tax residents.

However, the conditions laid down in bilateral agreements between France and the country where the income originates or where the bank account is located must be verified.

As regards the statute of limitations, under article L.169 of the Livre des procédures fiscales (Tax Procedure), the tax authorities have 10 years in which to make a recovery, unless the credit balances on foreign accounts do not exceed €50,000 at any given time during the year, in which case the statute of limitations is reduced to 3 years.

Right to make a mistake.

Since Law No. 2018-727 of August 10, 2018 for a State serving a society of trust, individuals have had a right to error.

From then on, a person who has disregarded, for the first time, a rule applicable to their situation or who has made a material error, cannot be subject to a penalty if theyhasve regularized their situation on their own initiative or after being invited to do so by the administration. The late payment interest due is reduced in the event of rectification, and no surcharge or fine will be added. The discount is 50% when the initiative comes from the individual, or 30% when the initiative comes from the administration.

Wealth tax or real estate wealth tax.

Given the statute of limitations, the taxpayer may also be liable for wealth tax on foreign accounts or foreign income until 2018, or for real estate wealth tax from that date.

It is therefore advisable to check the situation.

Our firm and tax specialist partners can help you regularize the situation.