How do I report and optimize the taxation of my foreign salaries? (form 2047, lines 1AF & 8TK, tax credit 2025)
Tax lawyer in Paris – 20 years of expertise in international remuneration
Summary
- French resident ⇒ worldwide taxation (French General Tax Code (CGI), article 4 A).
- Schedule 2047 mandatory, transferred to boxes 1AF/1AG, tax credit on line 8TK if there is a treaty.
- Possible exemptions: article 81 A (business development > 120 days).
- Tax lawyer: secures residence, calculates the tax credit, defends you in an audit.
What French tax rules apply to a foreign salary when you remain a tax resident of France?
- Worldwide taxation by default: If you are a French tax resident, article 4 A of the CGI taxes your worldwide income, including foreign salaries, unless a bilateral treaty provides otherwise.
- International tax treaties: In most cases, France grants a tax credit equal to the tax paid abroad (method for eliminating double taxation).
- Exemption exceptions: Certain situations make it possible to escape taxation in France in whole or in part (article 81 A for business development abroad, or the impatriate regime under article 155 B).
How do you complete form 2047 step by step for my foreign salaries?
- Convert the gross salary into euros at the ECB rate on the date of payment.
- Enter the gross amount in section I of form 2047 and indicate the tax paid abroad.
- Transfer the net taxable amount to box 1AF (or 1AG) of form 2042.
- Credit the tax on line 8TK if provided for by the tax treaty.
- Attach supporting documents: translated foreign payslip, certificate of foreign withholding tax.
Tax credit on line 8TK: how can double taxation of my foreign salaries be avoided?
Convention fiscale | Méthode | Ligne à remplir | Plafond | Justificatif requis |
Taux étranger <15% | Crédit égal à l'IR français | 8TK | IR théorique en France | Relevé d'impôt local |
Taux >30% | Crédit égal à l'impôt payé | 8VL | Montant payé à l'étranger | Quittance ou certificat de paiement |
What specific exemptions can I claim for my foreign salaries?
- Article 81 A: If you travel abroad on business development assignments for more than 120 days over 12 months, you may benefit from a full exemption of the salary relating to this assignment. This exemption is strict and subject to precise conditions regarding duration, assignment and affiliation.
- Article 155 B (impatriate regime): Reserved for employees coming to work in France after a stay abroad of ≥ 5 years. Although it works the other way round, it is worth knowing about for return or cross-mobility strategies.
Why entrust the management of my foreign salaries to a tax lawyer?
- Legal security: The lawyer checks that the appropriate tax treaty is applied, calculates the correct tax credit (method A or B), and makes sure that your tax residence is clearly established to avoid reassessments.
- Tax optimization: They advise you on the choice between the standard deduction and actual expenses, explore exemption options (81 A) and help you plan your cross-border bonuses or stock options.
- Anticipating audits: The lawyer builds a convincing file in the event of a tax audit (with translated supporting documents and proof of foreign tax) and assists you throughout the entire process: tax ruling (rescrit), litigation, hierarchical appeal.
FAQ
Why does France tax me when tax has already been withheld from my foreign salary?
France applies worldwide taxation to its tax residents. However, to avoid double taxation, tax treaties often make it possible to benefit from a tax credit in France equal either to the French tax (equal tax credit method) or to the tax actually paid abroad (limited tax credit method).
These amounts must be reported on line 8TK or 8VL, as applicable.
How do you complete form 2047 and box 1AF online for a salary received in the United Kingdom?
Start by converting the gross salary received in pounds into euros (ECB rate on the date of payment). Enter this amount in section I of schedule 2047, with details of the UK tax paid. The net taxable amount must be transferred to box 1AF of your return 2042.
The tax credit granted under the France–United Kingdom tax treaty must be reported on line 8TK.
What should I do if I discover that my 2022 foreign salaries were not included on line 8TK?
You can file an amended return until December 31 of the second year following the year in which the tax was assessed for collection (e.g. until 12/31/2025 for 2022 income taxed in 2023). You should also check that the tax credit has not already been included by the tax authorities.
In case of doubt or reassessment, a tax lawyer can help you build a convincing file.
Glossary
- 1AF / 1AG: Boxes on return 2042 where foreign salaries are entered according to the option chosen.
- 2047: Form dedicated to foreign-source income (salaries, dividends, interest…).
- 8TK / 8VL: Specific lines where tax credits are reported according to the applicable tax treaty.
- Article 81 A: Full exemption possible for business development assignments of more than 120 days.
Further reading
CGI, article 81 A: exemption for business development assignments abroad
Article 81 A allows a full exemption of salaries received during business development assignments carried out abroad, provided that the employee has spent more than 120 days outside France over a period of 12 consecutive months.
The exemption is strictly limited to the portion of remuneration corresponding to the days spent abroad. The company must be domiciled in France and justify the assignment by means of a commercial contract.
Tax credit and tax treaties: method A vs method B
- Method A: Tax credit equal to the tax paid abroad. Advantageous if the foreign tax is high.
- Method B: Tax credit equal to the French tax (“equal credit” method). Applies in OECD-model treaties.
The choice depends on the text of the tax treaty applicable between France and the country where the work is carried out.
