Question 1

Is assurance-vie the same as US or UK life insurance?

Accepted Answer

No. Despite the name, assurance-vie is a savings and investment product, not a protection product. It has no real equivalent in the US or UK system — the closest comparison is an ISA (UK) or a 529 plan (US), but assurance-vie is more flexible and covers a wider range of objectives.

Question 2

How is assurance-vie taxed in France?

Accepted Answer

During the contract: no tax on gains as long as you don't withdraw. On withdrawal after 8 years: €4,600 annual tax-free allowance per person (€9,200 for a couple), then 24.7% on the rest (7.5% income tax + 17.2% social charges). Before 8 years: 30% flat tax (PFU). At death: €152,500 tax-free per beneficiary on amounts invested before age 70.

Question 3

When can I withdraw money from an assurance-vie?

Accepted Answer

Anytime. Unlike a PER or a UK pension, assurance-vie is not locked. You can withdraw partially or fully at any moment. The 8-year holding period is purely about tax optimisation — you don't lose the money if you withdraw earlier, you just pay more tax on the gains.

Question 4

Can I have more than one assurance-vie?

Accepted Answer

Yes, with no limit. Many advisors recommend opening multiple contracts — one per long-term goal, or one per beneficiary. The 8-year tax clock runs separately on each contract, so opening contracts early (even with minimal initial funding) is a smart move.

Question 5

What's a good assurance-vie contract?

Accepted Answer

Look at three things: total annual fees (UC management fees should be under 0.5% — the bank versions are typically 1% or more), the range of available funds (a good contract offers low-cost ETFs), and the assureur's financial solidity. The best contracts are usually offered by online brokers, not traditional banks.

Question 6

Should US citizens hold an assurance-vie?

Accepted Answer

Caution. The IRS does not recognise the tax-deferred status of assurance-vie. For US citizens (subject to worldwide taxation), an assurance-vie can trigger PFIC reporting obligations and lose much of its appeal. Discuss with a cross-border specialist before opening one.

Question 7

Who can open a PEA?

Accepted Answer

Any individual fiscally domiciled in France, of legal age. Non-residents cannot open one — and if you become a non-resident after opening, your PEA can usually be kept but no further contributions are allowed.

Question 8

What's the PEA contribution limit?

Accepted Answer

€150,000 per person, lifetime. A couple can each have one, so €300,000 jointly. Within the wrapper, gains accumulate without counting toward the ceiling — so a PEA can easily hold significantly more than €150,000 in value after years of growth.

Question 9

What can I invest in inside a PEA?

Accepted Answer

Mainly European equities and equity funds. ETFs tracking global indices (S&P 500, MSCI World) are eligible if they use synthetic replication, which is the case for many popular Amundi, BNP Paribas Easy and Lyxor ETFs. Bonds, raw commodities, and US individual stocks are not eligible.

Question 10

PEA vs assurance-vie: which is better?

Accepted Answer

Different tools for different jobs. PEA wins on equity investments (lower tax: 18.6% social charges vs ~24-30% in assurance-vie). Assurance-vie wins on flexibility (no contribution limit, can hold bonds and fonds en euros) and succession (€152,500 per beneficiary). Most well-organised French savers have both.

Question 11

Can I withdraw from a PEA?

Accepted Answer

Yes, but with consequences. Any withdrawal before 5 years closes the PEA entirely. After 5 years, you can withdraw freely without closing the account. After 8 years, partial withdrawals are also allowed without closing — but contributions are no longer possible afterward.

Question 12

Is there a PEA for younger savers?

Accepted Answer

Yes. The PEA Jeunes is a variant for 18-25 year-olds attached to their parents' tax household. It has a reduced ceiling of €20,000. When they leave the tax household, the PEA Jeunes can be converted into a standard PEA.

Question 13

How does the PER tax deduction work?

Accepted Answer

Every euro contributed reduces your taxable income for the year. If your marginal tax bracket (TMI) is 41%, a €10,000 contribution saves you €4,100 in income tax — effectively making your contribution cost only €5,900 in net cash.

Question 14

What's the PER contribution ceiling?

Accepted Answer

For employees: 10% of your professional income from the previous year, capped at 8 times the annual social security ceiling (~€35,000 in 2026). For self-employed (TNS): higher ceilings apply. Unused allowance from the previous 3 years can also be carried forward.

Question 15

When can I withdraw money from a PER?

Accepted Answer

At retirement age (typically 62-64 in France). Before that, only in specific cases: purchase of primary residence, end of unemployment benefits, disability, over-indebtedness, or death of spouse. The lockup is the price of the tax deduction.

Question 16

PER vs assurance-vie for retirement: which is better?

Accepted Answer

PER wins on tax saving today (immediate deduction). Assurance-vie wins on flexibility (no lockup) and succession. The general rule: max out PER if you're in a high tax bracket (TMI ≥ 30%), and complement with assurance-vie. Both, ideally.

Question 17

Can self-employed people contribute to a PER?

Accepted Answer

Yes — and they have higher contribution ceilings than employees. The PER replaced the old « Madelin » contracts that were specifically designed for self-employed (TNS). Existing Madelin contracts can be transferred into a PER.

Question 18

What happens to my PER at retirement?

Accepted Answer

You can choose between three options at the time of liquidation: lump sum (taxed as income), lifetime annuity (taxed as pension), or a mix. The choice has significant tax implications and should be planned years in advance.

Question 19

What is the IFI threshold?

Accepted Answer

€1.3 million in net taxable real estate. The tax then kicks in from €800,000 with progressive rates. The threshold applies per household (foyer fiscal), not per person.

Question 20

How is IFI calculated?

Accepted Answer

The tax base is the market value of your real estate, minus deductible debt (mortgages, related expenses). Your primary residence benefits from a 30% allowance. Progressive rates: 0.5% from €800k to €1.3M, then up to 1.5% above €10M.

Question 21

Does IFI apply to property I own in my home country?

Accepted Answer

Yes, if you are a French tax resident. France taxes its residents on worldwide real estate. However, tax treaties may provide relief: in some cases, foreign tax already paid on the same property can be credited against IFI.

Question 22

Can I reduce my IFI?

Accepted Answer

Yes — three main levers. Take on or maintain mortgage debt on your properties (it's deductible from the IFI base). Hold real estate through a structure that gives it a professional character (in some cases). Make donations to qualified charities (reduces IFI by up to 75% of the gift, capped at €50,000).

Question 23

How is IFI different from the old ISF?

Accepted Answer

ISF (Impôt de Solidarité sur la Fortune, abolished in 2017) covered all assets — real estate, financial assets, businesses. IFI only covers real estate. For most wealthy households, the change was a major tax reduction.

Question 24

Are non-residents subject to IFI?

Accepted Answer

Yes, but only on their French real estate. A British retiree owning a Provence villa worth €2M is subject to IFI on the French portion, even though they live in the UK.

Question 25

What is the flat tax in France?

Accepted Answer

Officially called PFU (Prélèvement Forfaitaire Unique), it's a flat 31.4% tax on most investment income, including dividends, interest, and capital gains. The 31.4% breaks down as 12.8% income tax + 18.6% social charges (the social charges rate was raised in 2026 from 17.2% to 18.6%).

Question 26

Is the flat tax mandatory?

Accepted Answer

No. PFU applies by default, but you can opt out (option globale) on your annual tax return and have your investment income taxed at your marginal income tax bracket instead. This is advantageous if your TMI is 0% or 11%, neutral at 11-12.8%, and disadvantageous above.

Question 27

Does PFU apply to foreign dividends?

Accepted Answer

Yes, for French tax residents. Dividends from US stocks, UK stocks, etc. are subject to PFU. However, the foreign withholding tax already paid is credited against the French tax, up to the treaty rate.

Question 28

Does PFU apply to assurance-vie withdrawals?

Accepted Answer

Yes, but with a major exception. Withdrawals before 8 years are taxed at PFU. After 8 years, you benefit from the €4,600 annual allowance and then 7.5% income tax (instead of 12.8%) on the rest — plus 17.2% social charges (the assurance-vie social charges rate remained at 17.2%, unlike PEA and CTO which moved to 18.6% in 2026). So total 24.7% after 8 years.

Question 29

Does PFU apply to PEA gains?

Accepted Answer

No. The PEA has its own tax treatment. After 5 years, capital gains in a PEA are exempt from income tax — only 18.6% social charges apply (the rate moved from 17.2% to 18.6% in 2026). This is why the PEA is so much more tax-efficient than a regular brokerage account.

Question 30

What's the rate of French social charges on investments?

Accepted Answer

18.6% in 2026 for most investment income (was 17.2% before 2026). The breakdown: 9.2% CSG (Contribution Sociale Généralisée), 0.5% CRDS (Contribution au Remboursement de la Dette Sociale), 8.9% Prélèvement de Solidarité. All flat-rate, applied to gross investment income. Note: assurance-vie gains continue to be taxed at 17.2% under the previous breakdown (9.2% + 0.5% + 7.5%).

Question 31

Are social charges deductible from income tax?

Accepted Answer

Partially. 6.8 percentage points out of the 9.2% CSG are deductible from your taxable income the following year — but only if you opted out of the PFU and chose progressive taxation. Under PFU (the default), nothing is deductible.

Question 32

Do foreign nationals living in France pay social charges?

Accepted Answer

By default yes. However, EU and EEA nationals affiliated to another social security system (typically still working for a foreign employer under an A1 form) can claim exemption from CSG/CRDS on certain investment income, paying only the Prélèvement de Solidarité instead of the full rate.

Question 33

Do social charges apply to gains inside an assurance-vie?

Accepted Answer

Yes. The 17.2% social charges apply to all assurance-vie gains realised, regardless of how long you've held the contract. The 8-year holding period reduces income tax on the gains, but not social charges. This is why an assurance-vie is never « tax-free ».

Question 34

Are pension and salary income subject to the same social charges?

Accepted Answer

No, salary and pension income have a different mix of social contributions. The 18.6% rate (or 17.2% for assurance-vie) is specific to investment income. For salaries, the contributions go beyond CSG/CRDS and include actual pension and unemployment contributions.

Question 35

Can I disinherit my children in France?

Accepted Answer

Generally no. French law protects children through the « réserve héréditaire ». However, anglo-saxon nationals can elect the law of their nationality to govern their succession under the EU Succession Regulation 650/2012. This must be done explicitly in a will, drafted with a French notaire.

Question 36

How much of my estate is reserved for my children?

Accepted Answer

Depends on how many children you have: one child = 50% reserved (you can freely dispose of 50%). Two children = 67% reserved (33% free). Three or more children = 75% reserved (25% free). Your spouse has rights too, but they vary depending on the matrimonial regime.

Question 37

Can I leave everything to my spouse in France?

Accepted Answer

Not by default. If you have children, they automatically inherit at least 50% (one child), 67% (two), or 75% (three or more). To leave more to your spouse, you can: elect anglo-saxon law (if you're a foreign national), change your matrimonial regime, set up an assurance-vie with spouse as beneficiary, or use lifetime gifts.

Question 38

Does forced heirship apply to expats living in France?

Accepted Answer

If you are habitually resident in France at death, French law applies by default — including forced heirship. The EU Succession Regulation lets you opt for the law of your nationality. UK and US expats often use this to restore their freedom of disposition.

Question 39

How can I work around forced heirship legally?

Accepted Answer

Several tools exist: elect your home-country law (if you have anglo-saxon nationality), make lifetime gifts to your spouse (within abattements), use assurance-vie (passes outside succession with €152,500 tax-free per beneficiary), change matrimonial regime to community of property. The right combination depends on your specific situation.

Question 40

Does forced heirship apply to my home-country property?

Accepted Answer

Generally yes, if you are habitually resident in France — unless you have elected your home-country law. The EU regulation harmonised this: one law governs the entire estate, including assets abroad.

Question 41

What are the main French tax-free allowances I should know?

Accepted Answer

Five key ones. Lifetime gifts: €100,000 per parent per child every 15 years. Grandparent gifts: €31,865 per grandchild every 15 years. Assurance-vie succession: €152,500 per beneficiary (funds invested before age 70). Assurance-vie withdrawals after 8 years: €4,600 per year per person. Primary residence in IFI: 30% off the value.

Question 42

How often does the donation abattement reset?

Accepted Answer

Every 15 years. So a parent can give €100,000 to each child every 15 years entirely tax-free. Starting early in life means more renewals — a 40-year-old can use the allowance three times before age 85, transmitting €300,000 per child tax-free.

Question 43

Does the assurance-vie abattement apply per beneficiary or in total?

Accepted Answer

Per beneficiary, and it's huge. Each named beneficiary gets €152,500 tax-free, separately. A couple with three children can name them as beneficiaries: that's €152,500 × 3 = €457,500 tax-free per parent, so €915,000 jointly. Then 20% on the next €700,000, 31.25% above.

Question 44

Can I combine the donation abattement with the assurance-vie abattement?

Accepted Answer

Yes — they are completely separate. A parent can give €100,000 to a child via a notarised donation AND name them as beneficiary on an assurance-vie for another €152,500, all tax-free. Then refresh the donation every 15 years.

Question 45

Does the abattement apply to non-French citizens?

Accepted Answer

Yes. French inheritance and gift tax rules apply to residents regardless of nationality. The abattements are the same for a French national and a British or American long-term resident.

Question 46

How much can I give to my children tax-free in France?

Accepted Answer

€100,000 per parent per child every 15 years. So a married couple can give €200,000 per child every 15 years entirely tax-free. Starting early (in your 40s or 50s) lets you renew the allowance multiple times before death — a powerful long-term lever.

Question 47

Donation vs inheritance: which is more tax-efficient?

Accepted Answer

Donation, almost always. Inheritance rules use the same abattements but only once, at death. Donations refresh every 15 years, can be combined with assurance-vie, and lock in today's valuations. A well-planned series of donations can transmit several million euros tax-free over a generation.

Question 48

What's the cost of a donation in France?

Accepted Answer

Two components. The notaire's fee (typically 1-2% of the donation value, partly regulated, partly free). The donation tax above the abattement (progressive rates from 5% to 45%, depending on amount and relationship). Below the abattement: zero donation tax, just the notaire's fee.

Question 49

Can I give to grandchildren tax-free?

Accepted Answer

Yes. Each grandparent can give €31,865 per grandchild every 15 years entirely tax-free. Combined with the parent-to-child donation, a family can transmit substantial wealth across generations efficiently.

Question 50

Can I give to my unmarried partner or friend?

Accepted Answer

Yes, but the abattement is minimal (only €1,594 every 15 years for non-family) and donation tax rates are very high (60% above the allowance). Donating to non-family members is rarely tax-efficient in France.

Question 51

What's a « don manuel » and is it taxable?

Accepted Answer

A « don manuel » is an informal gift (cash, bank transfer, jewellery) without a notarial deed. It's perfectly legal, but should be declared to the tax authorities within one month of the recipient learning about it. The same abattements apply. Below the abattement, no tax — but the declaration starts the 15-year clock.

Question 52

Are SCPI a good investment?

Accepted Answer

It depends, but the marketing is usually more attractive than the reality. Pros: regular income, real estate exposure without the hassle of direct ownership. Cons: 8-12% entry fees mean it takes years to break even, limited liquidity, full income tax on distributions if held directly.

Question 53

How are SCPI taxed in France?

Accepted Answer

Like direct real estate income: rental income is added to your taxable income and taxed at your marginal rate, plus 18.6% social charges (rate raised in 2026 from 17.2%). So a 50% TMI taxpayer keeps only about 31% of the gross yield. This is the single biggest issue with SCPI for high earners.

Question 54

What's the difference between SCPI and a REIT?

Accepted Answer

Structurally similar (pooled real estate, income distribution), but the differences matter. SCPI typically have much higher entry fees (8-12% vs ~0% for listed REITs). SCPI are not listed on stock exchanges — liquidity comes from the secondary market managed by the SCPI itself. REITs are more liquid and lower-cost.

Question 55

Are SCPI worth the entry fees?

Accepted Answer

Only if you hold for the long term (10+ years) and accept the liquidity constraints. The 8-12% entry fee can be amortised over many years, but you must have certainty about the time horizon. For most diversified investors, simpler alternatives (low-cost real estate ETFs, listed REITs) are more efficient.

Question 56

Can I hold SCPI inside an assurance-vie?

Accepted Answer

Yes, and it improves the tax treatment significantly. Inside an assurance-vie, SCPI income is taxed under the AV regime (potentially 0% if you stay below the €4,600 annual allowance after 8 years) instead of as direct real estate income. The drawback: only certain SCPI are available, and AV management fees apply on top.

Question 57

Why do French banks push SCPI so aggressively?

Accepted Answer

The 8-12% entry fee is the source of distributor commissions. A bank advisor selling you a €100,000 SCPI receives substantial commission. This explicit conflict of interest is the main reason an independent, fee-only advisor will rarely recommend SCPI as a first option.

Account types

The PEA (equity savings plan) explained

Is the PER (retirement savings plan) really worth it?

The mandatory employer PER: an automatic top-up, less investment freedom

The PEE (company savings plan) explained

Assurance-vie: Lucya CNP, the market reference