Taxation of a securities account for non-residents: the 2026 guide
The most important rule to keep in mind from the outset: the taxation of a standard securities account (CTO) for a non-resident has little in common with that of a French tax resident. The well-known Single Flat-Rate Withholding Tax of 30% ("flat tax") that applies to residents does not generally apply to non-residents. Capital gains on securities realized by a non-resident are largely exempt from tax in France, and only dividends remain subject to withholding tax.
This guide sets the record straight for a French expatriate: what France actually taxes on your securities account, how tax treaties come into play, and how your securities portfolio fits into a mortgage application with a French bank. For the general framework of non-resident taxation, also keep our guide to taxation of rental income for non-residents handy.
First question to ask: where is your securities account held?
The country where your securities account is held — not your nationality — determines the applicable tax treatment. Three setups cover the vast majority of situations.
Setup | Taxation in France | Taxation in the country of residence |
|---|---|---|
Securities account in France, you are a non-resident | Capital gains exempt (Art. 244 bis B), dividends withholding tax | According to the tax treaty (tax credit or exemption) |
Securities account abroad, you are a non-resident | None — France has no claim | Local taxation only |
Securities account opened in France and retained after expatriation | See row 1 | According to the tax treaty |
⚠️ Important: an expatriate who was previously a French tax resident and no longer is, while keeping their securities account in France, changes tax regime on the date of the change of residence. Gains realized before the expatriation date remain taxed under resident rules (30% flat tax by default). Gains realized after that date follow the non-resident rules described below. Keeping a clear record of the switch date is essential.
💡 Key takeaway: for the rest of this article, we assume the most common situation among Invexa clients — you are a tax resident of a foreign country (USA, UK, Switzerland, Singapore, Hong Kong, etc.) and your securities account is held either in France or in your country of residence.
Capital gains on securities: the default exemption for non-residents
Article 244 bis B of the French General Tax Code is the central rule. Capital gains realized by a non-resident on the sale of securities (shares, ETFs, listed bonds) are exempt from tax in France.
Concretely, if you sell your LVMH shares in 2026 and realize a €10,000 gain while living in Singapore or New York, France does not tax it. No 30% flat tax, no withholding, nothing. You will, however, be taxed in your country of residence under its own rules (U.S. capital gains tax ≈ 15-20%, U.K. CGT ≈ 10-20%, exemption in Singapore, etc.).
The exception: substantial participation (> 25%)
This exemption does not apply if you hold (with your family group) more than 25% of the profit rights in a French company at any time during the 5 years preceding the sale. In that case:
Taxation at a flat rate of 12.8%.
Option to apply the progressive tax scale if more favorable.
Social contributions apply depending on the taxpayer's social security regime.
This case concerns executives and majority shareholders, not ordinary savers. For a French expatriate holding a diversified portfolio of listed shares, it is never an issue.
✅ Good to know: the default exemption also applies to funds, ETFs and SICAVs held in a securities account. It is one of the mechanical tax advantages of expatriation for a stock market investor — not something to overlook in the overall analysis.
Dividends: withholding tax and tax treaties
Dividends paid by a French company to a non-resident are subject to withholding tax. Article 119 bis 2 of the French Tax Code: the domestic rate is 12.8% since 2018 (for individuals). The payer (your broker or the distributing company) deducts this amount directly before paying you the net amount.
Tax treaties reduce this rate
Almost all tax treaties signed by France lower this rate. A few examples of treaty rates for dividends paid to a tax resident of the target country:
Country of residence | Treaty rate on French dividends |
|---|---|
United States | 15% (1994 treaty) |
United Kingdom | 15% (2008 treaty) |
Switzerland | 15% (1966 treaty) |
Singapore | 15% (2015 treaty) |
Hong Kong | 10% (2010 treaty) |
United Arab Emirates | 0% (1989 treaty) |
Germany | 15% (1959 treaty) |
To benefit from the treaty rate rather than the domestic rate of 12.8% (which is lower for individuals, and therefore favorable by default), you must prove your foreign tax residence to the account holder using a form 5000 (certificate of residence) or the local equivalent, to be renewed periodically.
Tax credit in your country of residence
The withholding tax deducted in France generally entitles you to a tax credit in your country of residence, limited to the local tax on the same income. This is the standard mechanism provided for in all treaties. Double taxation is thus neutralized — or almost, as in some cases a residual amount remains.
⚠️ Important: if your broker automatically withholds the domestic rate (12.8%) without applying the treaty rate, you must request a refund of the excess amount from the SIPNR (Service des Impôts des Particuliers Non-Résidents) — see our guide to the tax office for non-residents. The procedure is slow (sometimes 12 to 18 months), so plan ahead.
Social contributions: what really applies
On capital gains from securities realized by a non-resident: no social contributions, since there is no capital gains tax in France in the first place (except in cases of substantial participation).
On dividends: the 12.8% withholding tax (or treaty rate) replaces the usual taxation. No additional layer of social contributions for the general case of non-residents.
✅ Good to know: do not confuse this with the De Ruyter case (CJEU 2015), which is often wrongly cited in online guides. The De Ruyter ruling concerns French tax residents affiliated with a social security scheme in another EU/EEA state or Switzerland — it allows them to be exempt from CSG/CRDS on their investment income. It does not concern non-residents, who are already not liable for social contributions on their capital gains.
The PEA kept after expatriation
Good news for PEA holders who move abroad: the plan continues to work. Expatriation does not trigger either closure or forced taxation of the PEA. The only restrictions are:
No new contributions after expatriation (except a temporary return to France as a resident).
The PEA-PME follows the same rules.
Taxation on withdrawal
When funds are withdrawn after expatriation, taxation depends on your country of residence and the applicable tax treaty:
PEA > 5 years: exemption from tax on capital gains in France (same rule for residents and non-residents).
PEA < 5 years: taxation under non-resident rules (so often exemption except in cases of substantial participation).
Social contributions: not applicable to the portion of gain accrued during the non-resident period.
This is one of the few French wrappers that remains competitive even after expatriation. For a property purchase project in France, it can make sense to use the PEA as a source of down payment (on withdrawal or via an advance) — the exit taxation is well controlled.
Securities account and mortgage application
For a non-resident applying for a mortgage in France, the securities account is not neutral. It comes into play at two levels in the bank's analysis.
1. The securities account as part of your wealth
The size and composition of the portfolio reassure the bank about your financial strength, regardless of any current income. A well-diversified €100,000 securities account is a liquid asset that can be:
Pledged to secure the mortgage (an alternative to a mortgage lien, with lower fees).
Mobilized in case of hardship (rental vacancy, damage, job loss).
Private banks (UBS, CMB, SG Private Banking — see our comparison of foreign banks that lend to French clients) go even further with the Lombard mortgage: a mortgage directly secured by the securities portfolio, without touching the property.
2. Dividends as additional income
If your securities account generates regular dividends, the bank may include part of that income in its borrowing capacity calculation. But with weighting:
Consistency: the bank typically uses the average of the last 3 years, not the peak.
Prudential haircut: 50% to 80% of the average, depending on portfolio volatility.
Net-of-tax view: for a non-resident, the light tax treatment of the securities account is a positive factor — your net return is higher than that of a resident.
💡 Key takeaway: the simplicity of non-resident taxation on the securities account (withholding tax + capital gains exemption) is easier to explain to a bank analyst than a complex structure. For an application, the clarity of the numbers matters just as much as the amount.
How to present your securities account in an application
Four documents to prepare:
Annual statements for the securities account over 3 years (showing valuation and cash flows).
French tax statement (IFU) if the account is held in France — the annual summary issued by the broker.
Certificate of tax residence (form 5000 or local equivalent) proving non-resident status.
Applicable tax treaty, for reference — useful to explain the limited withholding tax if the bank asks.
A file organized on this basis avoids an excessive haircut due to some analysts' misunderstanding of the non-resident rules.
Conclusion
For a non-resident, the taxation of a securities account in France is simpler and more favorable than people think, provided you do not apply resident rules. Three points to keep in mind:
Capital gains on securities exempt by default (Article 244 bis B of the French Tax Code), except in cases of substantial participation.
Dividends: 12.8% withholding tax, reduced by treaty and offset by a tax credit in the country of residence.
Social contributions: not applicable in the general case.
The 2OP box / progressive scale option, PFU vs. tax scale comparisons by marginal tax rate, form 3916 obligations for foreign accounts — all of that concerns French tax residents, not you. The non-resident guide is short because the rules are simple.
For a property investment project in France, the right approach is to highlight this securities account in the mortgage application rather than trying to optimize its taxation (it already is). At Invexa, we systematically integrate the wealth dimension into the application structure — size of the securities account, recurring dividends, and pledge possibilities.
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