A French tax resident who sells a property located abroad in principle realises a capital gain taxable in France, subject to the tax treaty concluded with the country where the property is located. For a property located in France, the formalities are in principle carried out by the notary; for a property located abroad, they are in principle the responsibility of the seller, who files form no. 2048-IMM and pays the tax.
This article presents these formalities: in which cases the form is filed, the steps, a worked example and the consequences of a delay. The calculation of the gain is explained in the article on the taxation of the sale of a property abroad. Each situation deserves to be analysed, ideally with a lawyer, before the sale or as soon as it is concluded.
In brief
- A French tax resident is in principle taxable in France on the capital gain realised on the sale of a property located abroad, subject to the tax treaty.
- Form no. 2048-IMM is in principle filed, together with payment of the tax, within one month of the sale, with the registration office responsible for the seller.
- For a property located abroad, these formalities are in principle the seller’s responsibility, not that of the foreign notary.
- Where the treaty exempts the gain in France, which needs to be checked by a lawyer, the form is in principle not filed; the gain is then mentioned on return no. 2047.
- Late filing in principle gives rise to late-payment interest and a 10% surcharge.
Contents
In which cases is form 2048-IMM filed?
The answer depends on the seller’s tax residence, the applicable tax treaty and the amount of the gain:
| Situation | Form no. 2048-IMM | Remarks |
|---|---|---|
| French tax resident; gain taxable in France, with or without a tax credit provided for by the treaty | In principle yes, with payment, within one month of the sale | Any tax credit may be set against the French tax, within the limits provided for by the treaty (to be analysed by a lawyer) |
| French tax resident; treaty providing for exemption of the gain in France | In principle no | The gain is in principle mentioned on return no. 2047; only an analysis by a lawyer can determine whether or not the treaty exempts it |
| Capital loss, or gain fully exempt from income tax and social security contributions (for example after 30 years of ownership) | In principle no | A gain exempt from income tax after 22 years of ownership in principle remains subject to social security contributions until 30 years |
| Seller not resident in France | In principle no | A non-resident is in principle not taxable in France on the sale of a property located abroad |
The steps of the declaration
Declaring a sale abroad generally involves the following steps:
- having the tax treaty concluded between France and the country of the property examined by a lawyer: only this analysis can determine whether or not the gain is taxable in France and, where applicable, by which method double taxation may be avoided;
- gathering supporting documents: deeds of purchase and sale, invoices for works, acquisition costs, proof of the tax paid in the country of the property;
- converting amounts expressed in foreign currency into euros, in principle at the exchange rate on the date of each transaction (purchase, works, sale);
- calculating the gain under French rules: sale price, purchase price increased by costs (actual or a flat 7.5%) and works (actual or, after five years of ownership, a flat 15%), then the holding-period allowances (under the rules on real estate capital gains);
- completing form no. 2048-IMM-SD, with, where applicable, the tax credit provided for by the treaty;
- filing the form within one month of the sale, together with payment of the tax and a copy of the deed of sale translated into French (a free translation may in principle be sufficient), with the registration office responsible for the seller;
- carrying the net taxable gain over to the following year’s income tax return (return no. 2042 C, box 3VZ): as the tax has already been paid, this serves in particular to calculate the reference tax income.
Worked example
A French tax resident sells, in 2026, for €3,000,000, a flat located abroad, bought for €1,600,000 twelve years earlier. He uses the flat rates of 7.5% for acquisition costs and 15% for works. For twelve years of ownership, the allowance is 42% for income tax (6% per year from the sixth to the twelfth year) and 11.55% for social security contributions (1.65% per year).
| Item | Calculation | Amount |
|---|---|---|
| Increased acquisition price | €1,600,000 + €120,000 (costs, 7.5%) + €240,000 (works, 15%) | €1,960,000 |
| Gross capital gain | €3,000,000 − €1,960,000 | €1,040,000 |
| Income tax | €1,040,000 × 58% = €603,200, × 19% | €114,608 |
| Social security contributions | €1,040,000 × 88.45% = €919,880, × 17.2% | €158,219 |
| Tax on high capital gains | €603,200 × 6% (rate applicable above €260,000) | €36,192 |
| Total before any tax credit | €114,608 + €158,219 + €36,192 | €309,019 |
This amount is in principle declared and paid with form no. 2048-IMM within one month of the sale. If the treaty provides for a tax credit, the tax paid in the country of the property may be deducted, within the limits provided, which only an analysis of the situation by a lawyer can confirm or rule out; whether it can be set against social security contributions depends on the terms of the treaty and deserves to be examined. As the gain is included in the reference tax income, the exceptional contribution on high incomes may also be due, depending on the case, for the year of the sale.
In the event of delay or omission
In the event of late filing, the tax is in principle increased by late-payment interest of 0.20% per month and a 10% surcharge, raised to 40% where the return is not filed within thirty days of a formal notice. Where a sale has not been declared, the situation may, depending on the case, be regularised; the terms and consequences of such a step deserve to be examined beforehand with a lawyer.
The one-month deadline is short, and the sale of a property abroad combines French rules, the tax treaty and currency conversion. An analysis with a lawyer, preferably before the sale, generally makes it possible to prepare the supporting documents and anticipate the tax due in France.
What I see in my cases
What most often causes difficulty in my cases is the deadline: when the capital gain is taxable in France, form 2048-IMM is in principle filed within the month following the sale, a very short deadline. For the real estate wealth tax (IFI), I also see properties located abroad being undervalued, particularly when the cadastral value is used instead of the market value, and failures to credit the wealth tax paid abroad.
FAQ
Does the foreign notary take care of the French declaration?
In principle no. For a property located abroad, the French formalities (form no. 2048-IMM and payment of the tax) are in principle the seller’s responsibility.
Is the form filed if the treaty exempts the gain in France?
In principle no: the gain is then mentioned on return no. 2047. The same applies in the event of a capital loss or a fully exempt gain. Only an analysis of the situation by a lawyer can determine whether or not the treaty exempts the gain in France.
Within what time limit and where is the form filed?
In principle within one month of the sale, together with payment of the tax, with the registration office responsible for the seller.
How are prices in foreign currency converted?
In principle at the exchange rate on the date of each transaction: the purchase price at the rate on the day of purchase, the sale price at the rate on the day of sale.
Does the gain also appear on the income tax return?
In principle yes: the net taxable gain is carried over to box 3VZ of return no. 2042 C for the following year, in particular to calculate the reference tax income.
What happens in the event of an omission?
The tax authorities may, depending on the case, claim the tax with late-payment interest and surcharges. Regularisation may be considered in some cases; its terms deserve to be examined with a lawyer.
