French inpatriate tax regime 2026: exemptions, conditions and planning

France has designed a tax regime specifically aimed at attracting international talent: the inpatriate tax regime, codified in article 155 B of the Code général des impôts (CGI). This scheme allows executives, managers and experts recruited from abroad to benefit from substantial income tax exemptions for up to 8 years, alongside advantages on foreign-source passive income and wealth tax.

In 2026, this remains one of France's strongest tools for competing with London, Amsterdam and Singapore in the war for international talent — particularly in financial services, technology and consulting. But the regime raises precise questions: who qualifies, what exactly is exempt, how does it interact with international tax treaties, and what planning steps are required?

Article 155 B of the CGI exempts from income tax the inpatriation premium (at actual cost or, by election, at a flat 30% of net remuneration) and the fraction of salary corresponding to work performed outside France, those two exemptions being capped together at 50% of total remuneration. On top of that, and outside that cap, comes a 50% exemption on certain foreign-source passive income. The regime runs until 31 December of the 8th year following the start date.

Personal eligibility conditions#

Three cumulative conditions must be met.

First, the beneficiary must not have been tax-domiciled in France during the 5 calendar years preceding the date on which they take up their duties. This is assessed under article 4 B of the CGI: principal household, centre of economic interests, habitual residence. A French national who has lived abroad for 5 years is not excluded — nationality is irrelevant.

Second, the person must be recruited from abroad: either directly by a French company, or seconded by a foreign company to an entity of the same group established in France.

Third, they must carry out their professional activity in France from the date of appointment. Article 155 B sets no numerical working-time threshold: it refers to being called from abroad to take up an employment in a company established in France for a limited period.

Who is covered?#

The regime covers employees and the director-assimilated employees listed in 1°, 2° and 3° of b of article 80 ter of the CGI (SAS presidents, minority SARL managers paid a salary), called from abroad to take up an employment in a company established in France. Self-employed professionals are not within that scope: the text does not allow it.

Changing employer without losing the regime. The third paragraph of I-1 preserves the benefit of the regime where duties change within the French company, or within another French company belonging to the same group within the meaning of article L. 233-3 of the Commercial Code. That matters for executives recruited from the headquarters of an international group, and for those moving from a secondment to a local contract.

The most frequent profiles seen in practice: CFOs or MDs recruited from the UK or the US, engineers from Asia or Germany, start-up founders returning from Singapore or Canada, and banking executives posted to Paris after a secondment within the EU.

When inpatriation goes hand in hand with a company set-up (a subsidiary or branch recruiting its director from abroad), both sides are handled together: that is the purpose of our page on accounting support for international files.

Watch point: an employee initially seconded to France (under A1 certificate) who is offered a local contract mid-assignment must have their situation carefully analysed. The start date of the local contract may trigger a new 5-year look-back period if prior tax domiciliation is questioned.

The regime applies until 31 December of the eighth calendar year following the year duties commence. For an appointment in 2025, the exemption runs until 31 December 2033.

The period was extended from five to eight years by Act no. 2016-1917 of 29 December 2016, the Finance Act for 2017 (article 71): the version of article 155 B in force on 1 January 2017 already reads "eighth calendar year". Attributing that duration to the Finance Act for 2021, as is commonly done, is four years off. The duration is a maximum: the exemption only applies for the years in which the beneficiary is tax-domiciled in France.

The inpatriation premium#

Benefits linked to inpatriation — additional remuneration paid by reason of the assignment in France, such as accommodation costs, school fees, relocation costs and an installation allowance — are exempt from income tax.

Flat-rate option: where the premium is not precisely itemised, it is deemed equal to 30% of total net remuneration (article 155 B, I-1 of the CGI; paragraph II covers passive income). The base is remuneration net of social security contributions and of the deductible share of CSG, before the standard 10% allowance (BOI-RSA-GEO-40-10-20).

Actual cost option: where actual inpatriation costs are documented and exceed 30% of total remuneration, it is possible to claim their precise amount. The documentary burden is greater and audit risk higher. The 30% flat rate is the safer and more practical choice for most inpatriates.

The fraction attributable to activity performed outside France#

Where the inpatriate carries out part of their work outside France — international assignments, professional travel — the fraction of remuneration corresponding to days worked abroad is exempt from income tax, but on a condition the text states expressly: the trips abroad must be made in the direct and exclusive interest of the employer. The exemption is therefore not acquired simply because days were worked outside France. It is then calculated pro rata to foreign working days over total working days in the year.

Cumulative ceiling: at the taxpayer's election, either the combined total of both exemptions (inpatriation premium and foreign fraction) is limited to 50% of total remuneration, or the foreign fraction alone is limited to 20% of the taxable remuneration resulting from paragraph 1, that is, after the premium exemption. The two branches are alternatives and the choice belongs to the beneficiary.

A floor that is often overlooked. If the share of remuneration subject to tax after the regime is applied falls below the remuneration paid for comparable duties in the company or, failing that, in similar companies established in France, the difference is added back to the taxable base. The regime therefore cannot bring taxable pay below the market salary for the role. Paragraph I-4 also bars any reliance on article 81 A, which exempts employees seconded abroad: the two regimes do not combine.

Summary table: employment remuneration exemptions#

50% exemption on certain foreign-source passive income#

Inpatriates also benefit from a 50% exemption on investment income, intellectual and industrial property income, and gains on the disposal of foreign-source securities and corporate rights (article 155 B, II, of the CGI). That exemption is conditional: the payer of the income, or for capital gains the custodian of the securities, or failing that the company whose securities are sold, must be established outside France in a State or territory that has concluded a tax treaty with France containing an administrative assistance clause to combat tax fraud and evasion. Without that clause, the exemption does not apply. Symmetrically, capital losses are recognised only up to 50%.

This exemption operates independently of the 50% ceiling applied to employment income. It is particularly significant for executives holding stakes in foreign companies or receiving dividends from abroad.

What the tax authority looks at: dividends paid by a foreign company controlled by the inpatriate may be recharacterised if distributions appear to have been deliberately timed to exploit the exemption. Prior review with your adviser is strongly recommended.

IFI: a base limited to French property, for up to six tax years#

This rule does not come from article 155 B but from article 964 of the CGI, and it is not reserved to inpatriates: it covers any individual who has not been tax-domiciled in France during the five preceding calendar years. Such a person is taxable only on real estate located in France, for each year in which they keep their French tax domicile, until 31 December of the fifth year following the year in which the domicile was established.

The nuance matters: "until the fifth year following" is not "the first five years". Someone establishing domicile in 2026 stays on that limited base until 31 December 2031, which is six tax years. The rule is frequently overlooked and can represent a substantial saving for holders of foreign real estate.

Marc is a CFO recruited in January 2026 by a Paris-based company after 6 years in the United Kingdom. His gross annual remuneration in France is €200,000, including an inpatriation premium of €40,000 (20% of total). He also carries out 60 days of international assignments over 220 working days in the year.

Exempt base calculation:

• Inpatriation premium: EUR 40,000, the contractual figure used for the example. Two method caveats: the 30% flat rate is computed on net remuneration, not on the EUR 200,000 gross, and the election for the flat rate is a calculation, not a habit. Where it is more favourable, it is the one to take
• Foreign fraction: 60 / 220 × (€200,000 − €40,000) = 60 / 220 × €160,000 ≈ €43,636
• Total exempt: €40,000 + €43,636 = €83,636
• Ceiling check: 50% × €200,000 = €100,000 → ceiling not reached
• Taxable base remaining: €200,000 − €83,636 = €116,364

Without the regime, Marc would have been taxed on €200,000. The regime exempts 41.8% of his remuneration. In addition, Marc holds a stake in a UK company: dividends received from that foreign source benefit from the 50% passive income exemption.

Illustrative case: a founder returning to Paris after several years in the United States signs an SAS president contract without having had the situation reviewed, and the inpatriate regime is mentioned nowhere. Nothing is necessarily lost: the conditions are assessed at the start date, and the first income tax return remains the moment to claim the exemptions. The natural order would of course be the reverse, with the analysis before the signature.

The inpatriate tax regime is entirely separate from the social security regime. Income tax exemptions do not automatically generate social security contribution exemptions.

An inpatriate may, under certain conditions, elect to remain affiliated to a foreign social security scheme:

• under a secondment covered by a bilateral social security convention;
• via EU Regulation CE No. 883/2004 for EU/EEA nationals;
• through a special agreement with the relevant authority.

Where the inpatriate maintains foreign affiliation, the treatment of employer contributions paid to that scheme under the French contribution base is checked case by case, against the instrument that actually covers the situation: a bilateral convention, EU Regulation 883/2004 or a special agreement. The stake can be meaningful for the employer, but it cannot be assumed.

The exemptions under article 155 B of the CGI are French domestic rules. They apply unless a bilateral tax treaty supersedes them by granting France exclusive taxing rights or by allocating taxing rights to the source state.

The most complex situations arise with:

• US nationals: the United States taxes its citizens on worldwide income regardless of residence. The inpatriate regime reduces French tax, but does not remove US reporting obligations (FBAR, FATCA). See our guide on FATCA/FBAR for US nationals in France.
• UK nationals: the Franco-British tax convention includes specific provisions on employment income partly performed outside France.
• UAE nationals: the absence of income tax in the UAE raises questions about effective tax domiciliation before arrival in France.

A prior analysis of the international tax situation is always recommended, particularly for executives considering relocation or the management of their fiscal domicile.

The only elections article 155 B provides for concern the 30% flat rate (I-1) and the branch of the ceiling retained (I-3): that is how the regime shows up in the return. In practice, exempt income is reported from the first French income tax return onwards, in the boxes provided for it; the guidance notes for the year's return say which ones.

Documents to prepare from day one#

• Employment contract or engagement letter specifying the start date and the condition of recruitment from abroad;
• Proof of tax residence outside France for each of the 5 preceding calendar years (foreign tax assessments, tax residency certificates, domicile documents);
• Detailed calculation of the inpatriation premium or receipts supporting actual costs, if the actual-cost option is used;
• Log of days worked in France and abroad if the foreign fraction is claimed — this must be maintained throughout the year.

Failing to build this file from day one is one of the most common and costly mistakes. In a tax audit, the absence of proof of prior foreign tax domiciliation can result in the entire regime being disallowed, with back taxes, penalties and interest.

Flat-rate premium versus actual costs. For an executive whose actual inpatriation costs (expatriate housing, international schooling, double household) exceed 30% of remuneration, the actual-cost option is mathematically superior. However, it carries greater audit exposure. In the majority of cases, the 30% flat rate is chosen for its simplicity and legal certainty.

Combining the regime with a PER (retirement savings plan). Inpatriates can combine article 155 B exemptions with deductions for contributions to a Plan d'Épargne Retraite, within the standard French ceilings. Combining the two mechanisms lowers the effective tax rate of the early years, by an amount that depends entirely on how the remuneration is structured: it is a calculation, case by case.

Planning ahead for the end of the regime. Well before the 8-year ceiling, a full review of the remuneration structure is essential: salary versus dividends, foreign assets to be transferred, foreign life insurance policies, stock options or BSPCE whose liquidity window coincides with regime expiry. This planning work is part of a director wealth management review.

The underestimated risk: the evidence file. What an audit looks at is not a ticked box but the demonstration that the conditions were met: no French tax domicile over the five preceding calendar years, recruitment from abroad, and trips abroad genuinely made in the direct and exclusive interest of the employer. A file rebuilt after the fact defends far less well than one kept as you go. This point deserves careful attention when an executive first arrives in France.

Updated 2026-08-28. This article is for information purposes and does not substitute for personalised advice. For your specific situation, consult a chartered accountant (expert-comptable) registered with the Ordre des Experts-Comptables.