Assessment
Does the trust have a link with France?
The firm assesses whether a French nexus exists, notably by reviewing:
- the tax residence of the settlor, trustee and beneficiaries
- the rights of discretionary, contingent or future beneficiaries
- the nature and location of the trust assets
- the trust deed, letters of wishes and relevant amendments
Compliance
What must the trustee file in France?
Where a French nexus exists, the trustee may be required to file annual and event-based returns with the French tax authorities. The firm assists with:
- determining the applicable filing obligations
- preparing annual and event-based returns
- identifying reportable changes and transactions
- reviewing historical compliance
- regularising missing, late or incomplete filings
Transactions
Which transactions have French tax consequences?
The firm also advises on the French implications of:
- contributions and distributions
- changes to the settlor, trustee or beneficiaries
- loans and transactions involving the trust or its underlying entities
- acquisitions or disposals of French assets
- changes of trustee, governing law or jurisdiction
- restructuring or termination of the trust
- the death of the settlor or a beneficiary
The analysis may cover French income tax, real estate wealth tax, gift and inheritance tax, as well as the application of relevant double tax treaties.
The French rules
How is a trust taxed in France?
French law has no trusts of its own, but its Tax Code defines them and taxes them. The main rules, in force on 9 October 2026, are summarised below; their application depends on the trust deed and on how the trust actually operates.
- Art. 792-0 bis CGIBOI-DJC-TRUSTDefinition of a trust
- A trust is the set of legal relationships created under the law of a State other than France by a person, the settlor, who places assets or rights under the control of an administrator for the benefit of one or more beneficiaries or for a specified purpose. The name given to the structure abroad does not matter.
- Art. 792-0 bis CGIBOI-DJC-TRUSTSettlor and deemed settlor
- The settlor is the individual who set up the trust or, where it was set up by a professional or a legal entity, the individual who placed assets in it, directly or indirectly. After the settlor’s death, a beneficiary may be deemed to be the settlor for the trust assets and their accumulated income, which then fall within that beneficiary’s own tax position.
- Art. 1649 AB CGI · Art. 1736, IV bis CGIBOI-DJC-TRUSTBOI-CF-INF-20-10-50Reporting by the trustee
- Where the settlor, a beneficiary or an asset of the trust is connected with France, the trustee files an event-based return within one month of the creation, modification or termination of the trust, and an annual return of the market value of the trust assets at 1 January, by 15 June. Failure to file is subject to a fine of €20,000.
- Art. 792-0 bis, II CGIBOI-ENR-DMTG-30Gift and inheritance duties
- Assets passed on from a trust by gift or on death are subject to gift or inheritance duties on their net market value, according to the family relationship between the settlor and the beneficiary. Where the transfer on the settlor’s death is neither a gift nor part of the estate, a fixed rate applies to the share that cannot be allocated to a given beneficiary: 45% when it goes to descendants as a whole, 60% in the other cases.
- Art. 970 CGIBOI-PAT-IFI-20-20-30-20Real estate wealth tax (IFI)
- Real estate assets placed in a trust are included, at their net market value at 1 January, in the taxable wealth of the settlor or of the beneficiary deemed to be the settlor, under the same rules as the other assets.
- Art. 990 J CGIBOI-PAT-IFI-20-20-30-20The annual levy
- An annual levy at the top IFI rate, 1.5%, is due on the trust’s real estate assets when they have not been properly reported, as the case may be, in the IFI return of the settlor or deemed settlor or in the trust’s annual return. It is paid by the trustee; the settlor and the beneficiaries who have not met their own reporting obligations are jointly liable.
- Art. 120, 9° CGIBOI-RPPM-RCM-10-30-10-10Distributions to a French-resident beneficiary
- Income distributed by a trust to a beneficiary resident in France is taxed as investment income, whatever the nature of the underlying income. A return of capital does not fall within this rule: each distribution must be documented to establish whether it is income, accumulated income or capital.
Figures in force in 2026
| Item | 2026 |
|---|---|
| Fine for failing to file a trust return | €20,000 |
| Annual levy on undeclared real estate assets | 1.5% |
| Duties on a share passing globally to descendants | 45% |
| Duties on a share that cannot be allocated, other cases | 60% |
| Event-based return | within one month |
| Annual return (value at 1 January) | by 15 June |
A coordinated approach
International taxation→How does the firm work with the trustee’s advisers?
The firm works alongside trustees and their foreign legal, tax and financial advisers to provide practical guidance, secure the trust’s French reporting position and anticipate the French consequences of contemplated transactions.
Publications and award
2026 OCCUR Prize, Interprofessional CollaborationLa Rencontre OCCUR Paris
Press contribution · 24 June 2026Entrepreneurs: structuring your wealth alongside your business (in French)
Expert view · 6 October 2026Pharmacy owner’s remuneration: three structures, three approaches (in French)- Interview · 28 September 2026Setting up and handing over a pharmacy: why and how to plan ahead (in French)
ArticlesThe firm’s articles on the National Bar Council’s platform
Joint publication · 26 July 2026BSPCE: no contributions, but a line in the DSN payroll returnwith Arnaud Albalat (Galadrim) and Laura Sinthe (Puncto)
AbracamoveJoint publicationInternational retirement: what the country of residence changeswith Delphine Bes (Abracamove)