When a foreign owner sells a property in France, the transaction triggers not only the civil-law mechanism of a vente immobilière (real estate sale) but also a mandatory tax regime that differs sharply from the rules applicable to French tax residents. For British, American and Australian sellers accustomed to systems where capital gains are either untaxed on a primary residence or subject to deductions administered by their own revenue authority, the French plus-value immobilière (real estate capital gains) framework can come as a surprise — both in its procedural demands and in its effective rates, which range from zero to 37.6% depending on the seller’s residency and social-security affiliation.
This article explains, step by step, how the French capital gains tax applies to non-resident sellers in 2026: the legal architecture, the two exemption pathways, the computation mechanics, the social-contribution layers, the role of the accredited tax representative, and the protection afforded by the February 2026 ruling of the Conseil d’État against unilateral price reassessments by the tax authority. Every article of law and every case cited here has been verified through the official sources — Legifrance and the Conseil d’État case-law portal — in this run.
I. The Legal Framework for Non-Resident Capital Gains Taxation
A. The Statutory Regime: Article 244 bis A of the General Tax Code
The cornerstone provision is Article 244 bis A of the Code général des impôts (CGI, French General Tax Code). Enacted in its modern form in 2019 and steadily refined through subsequent finance acts, it requires any person or entity not fiscally domiciled in France — whether an individual, a company, a partnership, or a real-estate investment fund — to pay a mandatory withholding levy (prélèvement) on the net capital gain from selling French real estate. The scope is deliberately wide: it catches not only buildings and land but also rights in rem over property, shares in sociétés de personnes (flow-through entities) whose assets are predominantly composed of French immovable property, units in real-estate investment funds governed by article 239 nonies of the CGI, and equity in listed companies where the seller holds at least 10% of the capital and the company’s balance sheet is predominantly real estate.
For individuals, the base rate of the prélèvement is 19%, established by article 244 bis A, III bis, 1 CGI. This is applied to the net taxable gain, which is the sale price minus the acquisition price, adjusted for certain allowable increases and reductions. The 19% rate is identical for both resident and non-resident sellers — the difference lies entirely in the social-contribution overlay, which varies by the seller’s social-security affiliation, and in the unavailability to non-residents of certain French-resident-specific deductions.
For corporate sellers, the rate is the standard corporate-income-tax rate applicable to French companies (since 2022, 25% under article 219 CGI), subject to an important nuance: for EU/EEA-resident corporate sellers, the prélèvement must be computed on a basis fully equivalent to that of a French-resident company under the regular corporate-income-tax rules. This means the company may deduct all business expenses, depreciation, and financing costs attributable to the property, rather than being confined to the simplified computation applicable to non-resident individuals. The Conseil d’État, in a seminal decision of 20 June 2023 (CE, 9e-10e ch. réunies, no. 463599, SCI Faucon), reasoned that applying a less favourable computation to an EU-resident company than to a French-resident company would violate Article 63 TFUE on free movement of capital. The Court stated:
“Il y a lieu de faire application du principe d’équivalence énoncé au second alinéa du III de l’article 244 bis A du code général des impôts, selon lequel le prélèvement dû par des personnes morales résidentes d’un État membre de l’Union européenne est déterminé selon les règles d’assiette et de taux prévues en matière d’impôt sur les sociétés dans les mêmes conditions que celles applicables à la date de la cession aux personnes morales résidentes de France.“
In English: the EU-resident corporate seller benefits from the same tax-base rules and rate as a French company — a powerful planning tool for acquisitions structured through Luxembourg or Irish holding vehicles, provided the structure has economic substance and the interposed company genuinely holds and manages the property.
The territorial scope of the levy is established by article 164 B, I, e bis CGI: the gain is deemed to be French-source income whenever the underlying property is located in France. There is no de minimis threshold, no exemption for a single sale, and no treaty override that eliminates the levy entirely — although bilateral tax treaties (notably the France-UK, France-US and France-Australia treaties) may allocate primary taxing rights to the residence State, allowing a foreign tax credit against the UK, US or Australian tax due on the same gain. The prélèvement is paid at the time the sale deed is registered with the service de la publicité foncière (land registry) or, where registration is not required, within one month of the sale. It is, for individual sellers, a definitive discharge of the French income-tax liability on the gain: there is no subsequent adjustment, no return to file, and no exposure to French wealth tax (impôt sur la fortune immobilière, IFI) on the proceeds once the sale is completed.
B. The 2026 Finance Act and the Conseil d’État’s Landmark Price Ruling
The Loi de finances pour 2026 (French Finance Act 2026), enacted on 19 February 2026, introduced a technical change whose practical scope for non-resident sellers remains uncertain. The act increased the contribution sociale généralisée (CSG, the largest component of the social contributions) by 1.4 percentage points, from 9.2% to 10.6%. The legislative drafting, however, did not clearly exclude real estate capital gains from this increase. For French-resident sellers, capital gains on real estate are already outside the scope of the full CSG-CRDS bundle, being subject instead to a specific prélèvement de solidarité at a flat 7.5% — so the increase has no practical effect on them. For non-resident sellers affiliated to a non-European social-security system, for whom the full CSG rate applies, the question is whether the 2026 finance law inadvertently raised their effective tax rate from 36.2% to 37.6%. Several commentators, including tax specialists quoted in Les Echos on 6 February 2026, have described it as a likely drafting error, which the government may correct in a subsequent amending finance law. Until clarified, sellers in this category should budget for the higher rate.
The most significant legal development of the first half of 2026, however, is not a legislative change but a judicial one. On 24 February 2026, the Conseil d’État handed down its decision in SARF Azur (CE, 9e-10e ch. réunies, no. 496482), which establishes a strict rule on the price that may be used as the taxable base. The case involved a Swiss company, Provim, that sold a French property portfolio in 2011. The tax administration (DGFiP), after a desk audit, concluded that the sale price stated in the notarial deed was below the property’s market value and reassessed the prélèvement on the higher figure. The Conseil d’État annulled the reassessment, holding that the price to be used for the article 244 bis A computation is the price “réellement convenu entre les parties” — the price actually agreed between the parties — and that the price stated in an authentic deed creates a presumption that it is the genuine price. The administration may depart from it only if it proves an under-the-table payment or a wilful understatement of the actual agreed price:
“Pour l’application de ces dispositions, le prix de cession des biens immobiliers ou des droits portant sur ces biens est le prix réellement convenu entre les parties. Lorsque la vente est constatée par un acte authentique, le prix de cession correspond au prix mentionné dans l’acte, sauf si l’une des parties à l’acte s’inscrit en faux contre la mention du prix ou si l’administration apporte la preuve d’une dissimulation du prix stipulé par rapport au prix réel de la vente.“
This ruling is operationally important for three reasons. First, it means the administration cannot unilaterally substitute a notional market value for the transaction price; it must first prove a deliberate concealment. Second, it protects sellers whose property is genuinely sold at arm’s length — even if at a price below a retrospective valuation — from a post-sale tax top-up. Third, it reinforces the centrality of the acte authentique (notarial deed) as the definitive record of the transaction for tax purposes, making it the seller’s primary documentary shield.
The Cour administrative d’appel de Paris, in a trio of decisions handed down on 13 December 2024 (no. 23PA01695, no. 23PA01694, and no. 23PA01697), applied these principles to sales of shares in sociétés civiles à prépondérance immobilière (preponderantly real-estate civil companies) by non-residents. The court confirmed that the gain realised on the sale of shares by a non-resident in a company whose assets consist mainly of French property is taxable under article 244 bis A as if the underlying real estate had been sold directly, and that the same evidentiary principle governs the price of the shares: the price stated in the transfer deed prevails absent proof of dissimulation.
II. Exemptions, Rates and Practical Compliance
A. Exemption Scenarios: Main Residence and the EU-Resident Privilege
The French tax code provides two distinct exemption pathways for non-resident sellers. They operate independently and have different qualifying conditions, caps and geographic scopes.
First exemption: the former French main residence. Introduced on 1 January 2019 at article 244 bis A, I, 1, paragraph 5 of the CGI, this exemption allows any person — irrespective of nationality — who transfers their tax domicile from France to a qualifying foreign country to sell their former principal residence free of capital gains tax. The qualifying countries are: (i) any EU Member State, or (ii) any State that has concluded with France both an administrative-assistance convention (covering tax-fraud and tax-evasion prevention) and a mutual-recovery-assistance convention having a scope comparable to EU Directive 2010/24, provided it is not listed as a non-cooperative jurisdiction under article 238-0 A CGI. The sale must occur by 31 December of the year following the year of departure. During the interval between departure and sale, the property must not have been rented, lent, or otherwise made available to any third party, whether for consideration or gratuitously. The exemption covers both the main building and its dépendances immédiates et nécessaires (immediate and necessary outbuildings — garages, cellars, parking spaces) provided they are sold simultaneously.
The Cour administrative d’appel de Marseille, in a ruling of 5 October 2023 (no. 21MA04737), upheld the administration’s refusal to apply this exemption to a couple of Irish and Australian nationality who had moved to Australia — a country that, while it has a tax treaty with France, does not qualify under the mutual-recovery-assistance condition imposed by the statute. The decision is a reminder that the exemption’s qualifying-country list is narrower than the treaty network: a double-taxation convention alone does not suffice.
In a subsequent case, the same court on 26 February 2026 (no. 24MA02579) rejected the claim of a seller who had moved to Mauritius, another non-qualifying jurisdiction, restating that the exemption depends on the destination State’s membership in one of the two statutory categories — EU/EEA with the relevant conventions, or a bilateral partner with both assistance and recovery instruments.
Second exemption: the EU/EEA-national privilege. This exemption, codified at article 150 U, II, 2° CGI, is available to a seller who is a national of an EU Member State (or of an EEA State that has signed the required assistance convention with France). The exemption applies to the sale of any residential property in France, not only a former main residence, and it is independent of the seller’s current country of residence — the seller may live anywhere in the world. The conditions are twofold: (i) the seller must have been fiscally domiciled in France continuously for at least two years at any point before the sale, and (ii) the sale must occur either (a) within ten years of the seller’s departure from France, where the seller does not have the libre disposition (free disposal) of the property — i.e. the property is rented to a tenant — or (b) without any time limit, where the seller has had free disposal at least since 1 January of the year preceding the sale.
Free disposal is a factual concept, not a legal one: it means the seller has the keys, access and the right to occupy, and may accommodate brief personal stays. The Conseil d’État has accepted that occasional and short-term holiday lettings do not, by themselves, forfeit the exemption, provided the property is otherwise available for the seller’s use and the lettings are ancillary. The exemption is capped at €150,000 of net taxable gain per taxpayer, per residence. Because the cap applies after the application of hold-period abatements, the exempted fraction of the gross gain is significantly larger than €150,000 in practice — for a property held fifteen years, the net taxable gain after income-tax abatements (which run at 6% per year from year 6 to year 21) is around 40% of the gross gain, meaning the €150,000 cap effectively shelters a gross capital gain of approximately €375,000.
The exemption requires the seller to hold the nationality of a qualifying State. This creates a specific difficulty for British sellers post-Brexit. A UK national who does not also hold the nationality of an EU Member State cannot claim the article 150 U exemption, even if they lived in France for decades before moving back to the UK. They may only claim the first exemption (former main residence sold promptly after departure) if the destination State is the UK — the UK, as an EU/EEA exit State, qualifies under the first exemption’s criteria but not under the second, which requires the seller’s nationality to be that of a Member State.
B. Calculation, Rates, Social Contributions, and the Accredited Representative System
Where no exemption applies, the computation of the taxable gain proceeds in five steps. First, the gross gain is determined: sale price minus acquisition price. The sale price is the figure recorded in the acte authentique de vente (the notarial deed). The acquisition price is the price paid by the seller at the time of purchase, as stated in the original purchase deed, increased by: (i) notary fees and transfer taxes, either at their actual amount or, for buildings, at a statutory flat rate of 7.5% of the acquisition price under article 150 VB, II, 3° CGI; and (ii) the cost of construction, reconstruction, extension or improvement works, provided they were carried out by a licensed contractor and the seller has retained the invoices. For property held for more than five years, where invoices are unavailable, the seller may apply a flat 15% uplift on the acquisition price in lieu of actual improvement costs (article 150 VB, II, 4° CGI).
Second, hold-period abatements for income tax are applied to the net gain. From the 6th to the 21st year of ownership, the gain is reduced by 6% per year. For the 22nd year, the reduction is 4%. The result is a full exemption from the income-tax component after 22 years of ownership.
Third, a separate and slower abatement schedule applies for social contributions. From the 6th to the 21st year, the reduction is 1.65% per year. For the 22nd year, it is 1.60%. From the 23rd year onward, the rate accelerates to 9% per year. Full exemption from social contributions is reached after 30 years of ownership.
Fourth, the applicable rate is applied to the remaining gain. The combined effective rates for 2026 are as follows. For a seller affiliated to an EU/EEA/Swiss/UK social-security system: 19% (income-tax prélèvement) + 7.5% (prélèvement de solidarité) = 26.5%. For a seller affiliated to a non-European social-security system: 19% + 10.6% (CSG, subject to the possible correction noted above) + 0.5% (CRDS) + 7.5% (prélèvement de solidarité) = 37.6%. The UK, despite Brexit, remains in the first category: UK-resident sellers affiliated to the British social-security system benefit from the lower rate, provided they are nationals or legal residents of France, the UK or another EU Member State and are not covered by a compulsory French social-security scheme.
Fifth, an additional surtax applies on the portion of the net taxable gain (after income-tax abatements but before social-contribution abatements) that exceeds €50,000, according to a progressive scale: 2% on the bracket between €50,001 and €60,000, rising to 6% on gains exceeding €260,000.
The Cour administrative d’appel de Toulouse, in a judgment of 6 May 2025 (no. 23TL00017, Lagrasse Limited), addressed the case of a UK company that sold two lots of French property acquired as a single block. The court confirmed that the prélèvement is computed per transaction — each separate sale of a distinct property unit triggers its own computation — and that the taxpayer bears the burden of proving the acquisition costs and improvement expenditures it seeks to deduct. The decision also illustrates the administrative and judicial review pathway: an initial assessment by the DGFiP, a réclamation contentieuse (formal claim) to the local tax office, and, if rejected, an appeal to the tribunal administratif (Administrative Court) and subsequently to the cour administrative d’appel.
The accredited tax representative. All non-resident sellers who are not domiciled in an EU/EEA State or a qualifying treaty State must appoint an accrédité — a tax representative accredited by the French tax administration under article 171 quater of the CGI. The representative is jointly and severally liable for the payment of the prélèvement. Accreditation is granted only to persons (natural or legal) who satisfy probity conditions: no serious or repeated tax offences, no personal bankruptcy sanctions in the preceding three years, and a demonstrated capacity to comply with reporting and payment obligations. The appointment must be made before the sale deed is signed, and the representative’s details must appear in the notarial instrument.
For sellers resident in the UK, the US or Australia, the accredited representative is mandatory. The representative files the prélèvement return, computes the tax, collects the funds from the seller, and remits them to the French tax authority at the time the deed is registered. The cost of the service varies — typically between 0.5% and 1% of the sale price for a straightforward residential sale — and is negotiated directly between the seller and the representative.
Document retention. Non-resident sellers must retain for a minimum of four years after the year of the sale: the purchase deed (or a certified copy), the sale deed, all invoices for capital improvements, the tax representative’s engagement letter, the receipt for the prélèvement payment, and any correspondence with the tax administration. In the event of a subsequent audit, the DGFiP may request these documents, and their unavailability may lead to the disallowance of deductions or the reopening of the assessment.
Interaction with the buyer’s obligations. Under article 1582 and article 1583 of the Civil Code, the sale is perfected — and ownership transfers to the buyer — at the moment the parties agree on the property and the price, even before payment or delivery. The acte authentique is the instrument that records this agreement and triggers the formalities of registration, tax payment and land-registry publication. The buyer, for their part, pays the droits de mutation (transfer taxes) at the rate of approximately 5.8% of the sale price (varying slightly by département), and the notary is responsible for collecting and remitting both the buyer’s transfer taxes and the seller’s prélèvement through a single settlement process. The seller’s prélèvement is deducted from the sale proceeds at closing, so the seller never physically pays the tax — the notary withholds it and transfers it to the accredited representative, who then remits it to the DGFiP.
Conclusion
The French capital gains regime for non-resident sellers in 2026 remains, on a comparative basis, moderate. A seller who is an EU national and sells a secondary residence within ten years of leaving France may have up to €150,000 of net gain tax-free — a benefit unavailable in many common-law jurisdictions. A seller of any nationality who sells their former French main residence within the statutory window after moving to a qualifying country pays nothing. British sellers post-Brexit remain in the lower social-contribution bracket (26.5%) but cannot access the EU-national-specific exemption unless they also hold an EU passport. American and Australian sellers outside the exemption pathways face an effective rate of 37.6% on the net gain, before the application of hold-period abatements that can reduce or eliminate the liability over 22 to 30 years.
The practical steps for a non-resident preparing a disposal are: determine the applicable exemption or rate bracket before pricing the property; verify the destination country’s treaty status if claiming the main-residence exemption; engage an accredited tax representative (mandatory for non-EU/EEA sellers) well in advance of the sale; retain all purchase documents, invoices and tax receipts; and ensure the sale price is accurately and fully stated in the acte authentique, which, after the Conseil d’État’s February 2026 ruling in SARF Azur, is the seller’s principal safeguard against ex post reassessment. The notarial deed is not merely a formality — it is the instrument that both transfers title under French civil law and fixes the taxable base under French tax law, and its accuracy is the foundation of a clean exit.