French tax resident: don’t forget your foreign bank accounts

Like several million French tax residents, you may have one or several bank accounts outside France. You may also have an account in what is called a neobank. These payment applications, very easy to use, allow you to manage your budget in real time with a single click or to spend abroad at a lower cost. Some ignore it but many of these fintechs are established abroad (like N26 or Vivid Money in Germany, Revolut or Monese in the UK). As a consequence, these payment accounts are considered foreign by the tax administration and must be declared in your annual tax return.

Failing to do so, triggers a penalty of 1.500 € by foreign bank account omitted. The penalty is raised to 10.000 € when the omitted bank account is in a country or territory which did not sign with France a double taxation convention providing for measures against internation tax evasion and access to banking information (in short: tax paradise).

Reminder: what is to be declared is the existence of the bank account (i.e. the nature of the account – current or savings or portfolio… -, the name and address of the bank institution, the number of identification) but not your balance sheet. In other words, whatever the smallness of the amounts of money effectively at stake, your failure to declare the account will lead to the penalty(ies).

The penalty per bank account omitted is to be applied annualy (like the relating French yearly tax return to be fullfilled) and the French tax administration is allowed to go back 4 years in the past. The penalty for an « old » foreign bank account that was omitted can therefore involve a 6.000 € penalty (or a 40.000 € in the case of a tax paradise bank account).

Of course, if these foreign bank accounts generated financial gains/incomes that were also omitted and/or involved an underestimation of the French wealth tax (before 2018) or was a recipient for hidden active incomes, then the tax payer concerned faces very serious additional tax (or criminal) consequences and he/she should search for professional advice as soon as possible.