You have a British personal pension, a SIPP you built up over twenty years, perhaps an old workplace money-purchase pot, and you are settling in France. The first question your neighbour asks is whether you can keep it. The second is what the French tax office will take. The third, usually asked too late, is whether the 25 per cent you took tax-free in Britain stays tax-free in France. This guide answers all three in the order a British reader actually meets them: what happens on the UK side when you draw or move the pension, when France treats you as its taxpayer, how France taxes the pension year after year, and what to do when the bill, a transfer block or a refusal looks wrong.
A SIPP (self-invested personal pension) is the British wrapper most readers of this page hold: a registered pension scheme in which you choose the investments. A QROPS (qualifying recognised overseas pension scheme) is the only kind of overseas scheme to which a UK pension can be transferred without the transfer itself being punished. A PCLS (pension commencement lump sum) is the famous 25 per cent tax-free lump sum. Keep these three abbreviations in mind; everything below turns on them.
I. Can I keep my British SIPP, move it to France, and what does Britain take first?
A. Should I leave my SIPP in Britain, draw from it, or transfer it to a QROPS, and what is the 25 per cent charge?
Leaving the pension where it is remains the default choice for most British residents in France, and for good reason: nothing in French or British law forces you to move a SIPP because you moved to Dordogne or Paris. Your UK provider keeps paying drawdown income or annuities to your French bank account, deducts UK tax at source where its rules require it, and you sort out the final position in France. The treaty then decides which country keeps the tax, and the paperwork described below reclaims what Britain should not have kept.
On the British side, three figures govern every decision. First, the tax-free lump sum. Under the British tax-free lump sum rules, up to 25% of any pension pot can usually be taken free of UK tax, up to a ceiling of £268,275. That is the PCLS, and it is genuinely free of UK tax. But “tax-free in Britain” and “tax-free in France” are two different questions, and the French answer, developed in part II, disappoints many readers: France has no equivalent exemption for a foreign pension lump sum and taxes it under its own rules, subject only to the treaty allocation and the quotient mechanism. Take the lump sum before you understand the French treatment and you can manufacture a large French bill in a single year.
Second, the transfer option. The British rule, set out in the official guidance on transferring to an overseas scheme, is blunt: the receiving scheme must be a qualifying recognised overseas pension scheme (QROPS), a status the saver has to verify with the scheme, the UK provider or an adviser. And the warning that follows matters: where the receiving scheme is not a QROPS, the UK scheme may refuse the transfer or an unauthorised-payment tax of at least 40% applies. In practice there is no French QROPS market of any depth, so most British residents in France who transfer move their pot to a QROPS based in a third country such as Malta or Gibraltar, which raises the third figure.
Third, the overseas transfer charge. Britain levies 25 per cent on transfers to a QROPS unless an exemption applies: no UK transfer tax is due where both conditions hold, namely the saver lives in the country where the QROPS is based and the transfer stays within the available overseas transfer allowance. Since Brexit, a British reader living in France and transferring to a Maltese QROPS fails the first limb and pays the 25 per cent, a painful outcome that must be priced before any adviser mentions Malta. The allowance itself is generous — usually £1,073,100 — and only the excess above it bears the charge where the transfer is otherwise exempt, but the country-matching condition is the one that traps French residents. There is a five-year tail: move country within five years of the transfer and the charge can be refunded or retrospectively imposed, so the decision follows you.
Practical consequences follow. Get a written statement from the receiving scheme confirming QROPS status on HMRC’s published list before you sign anything, and a written statement from your UK provider of the transfer value, the overseas transfer allowance position and whether it will apply the 25 per cent charge. If the UK provider refuses the transfer, ask for written reasons: providers sometimes refuse where they suspect a pension scam or where the receiving scheme’s status is doubtful, and that letter is the starting point of any challenge. The government’s own guidance points you to help where a scam is suspected, and a refusal grounded in a documented scam concern is very hard to overturn, while a refusal grounded in an administrative error can be corrected through the provider’s complaints process and then the Pensions Ombudsman. Never transfer at the speed a cold-calling adviser demands; the 40 per cent unauthorised-payment exposure for a non-QROPS transfer is the single most expensive mistake on this page.
Drawing down while leaving the pot in Britain avoids all of this, but it creates the double-deduction problem the treaty exists to solve. Britain’s own guidance on pensions and residence abroad states the starting point plainly: both the country of residence and Britain may tax the pension. Your UK provider applies PAYE to the drawdown, France taxes you as its resident, and you then eliminate the double hit through the treaty machinery: exemption in one state with the form France Individual DT, credit or exemption in the other. Readers who skip the form pay twice for months and then fight for a repayment; readers who file it early pay once, in the right place.
B. When do I become taxable in France, which country does the treaty favour, and how do I stop paying twice?
France taxes its residents on worldwide income. That is the whole ball game for a British pensioner arriving with UK-source pensions: once you are a French tax resident, the SIPP drawdown, the annuity and in principle the lump sum all enter the French base. French domestic law expresses the entry ticket through three alternative tests — home or principal stay in France, professional activity in France, or centre of economic interests in France — and the administrative court of appeal in Paris has confirmed that meeting one test is enough, quoting the code: “Sont considérées comme ayant leur domicile fiscal en France au sens de l’article 4 A : / a. Les personnes qui ont en France leur foyer ou le lieu de leur séjour principal”, and adding that “il suffit qu’il réponde à l’un des trois critères définis par l’article 4 B du code général des impôts”. In that case the taxpayer, a British-connected film director with homes and income on both sides of the Channel, was held French-resident because his economic centre of gravity lay in France even though he filmed abroad and owned substantial foreign property (CAA Paris, 15 March 2018, No. 17PA01909, available on Légifrance). Pensioners should read that decision as a warning: keeping a London flat while living, spending and receiving care in France does not reliably keep you non-resident.
Where both countries claim you — HMRC because of days spent or ties, France because of your home — the treaty tie-break in Article 4 of the France–United Kingdom convention signed in London on 19 June 2008 decides, and its cascade is worth knowing by heart: “cette personne est considérée comme un résident seulement de l’Etat contractant où elle dispose d’un foyer d’habitation permanent ; si elle dispose d’un foyer d’habitation permanent dans les deux Etats, elle est considérée comme un résident seulement de l’Etat avec lequel ses liens personnels et économiques sont les plus étroits (centre des intérêts vitaux)” (CAA Paris, 15 March 2018, No. 17PA01909, reproducing Article 4). Only if that test fails do habitual stay, nationality and finally mutual agreement between the two tax authorities come into play. The convention itself was published by the French Republic and its text, including Articles 18 and 19 on pensions, is freely available in the Journal officiel (Decree No. 2010-20 of 7 January 2010).
The substantive pension rule is then short and favourable. Article 18 of the convention then reserves private-employment pensions to the residence state: subject to the public-service rule in Article 19(2), pensions and similar remuneration paid to a resident of one contracting state for past employment are taxable only in that state. A British private-sector pension paid to a French resident is therefore taxable only in France. Britain must stand back. The mirror rule in Article 19 reserves public-service pensions — civil service, local authority, police, armed forces, teachers in state schemes and similar employment — to the paying state, with a nationality-and-residence exception, so a former NHS administrator or a retired British Army officer living in France normally remains taxable in Britain on that pension, while a retired Tesco manager or a SIPP built from private employment is taxable only in France. Mixed careers produce split treatment: each pension follows its own article, and the declaration must reflect that split rather than lumping everything together.
The machinery that gives effect to “taxable only in France” is HMRC’s form France Individual DT. According to HMRC’s official notes to the form, the France Individual DT is the vehicle for claiming exemption from UK income tax on UK-source pensions, purchased annuities, royalties, interest and the UK State Pension under the convention. The procedure matters as much as the principle: your local French tax office (service des impôts des particuliers) certifies your French residence on the form, and the certified form goes to HMRC in Nottingham. File it as soon as your French residence is established, keep the UK P60s and pension payslips, and if UK tax was already deducted, the same form carries the repayment claim. Where both states have already taxed the same pension and neither yields, the mutual agreement procedure between the two administrations is the dedicated remedy, described in our guide to eliminating Franco-British double taxation through agreement and arbitration.
II. How does France tax my British pension each year and how do I challenge the bill?
A. How is my SIPP income declared, what is the 10 per cent allowance, and how is the lump sum taxed without destroying one year?
French domestic law starts from a blunt assimilation. Article 79 of the General Tax Code provides: “Les traitements, indemnités, émoluments, salaires, pensions et rentes viagères concourent à la formation du revenu global servant de base à l’impôt sur le revenu. Il en est de même des prestations de retraite servies sous forme de capital.” Two consequences flow from that single sentence. First, your British pension is taxed like a salary, at the progressive scale, not at a flat rate. Second, a pension paid as a lump sum — the PCLS you took tax-free in Britain, a full SIPP encashment, a trivial-commutation payment — is expressly within the French base: “prestations de retraite servies sous forme de capital”. The British exemption does not travel. Budget for French tax on the lump sum in the year you take it, or better, take advice before you take it.
The code softens the salary treatment with a standard allowance. Article 158, 5, a of the General Tax Code provides: “Les pensions et retraites font l’objet d’un abattement de 10 % qui ne peut excéder 4 439 €.” The same paragraph adds the floor: “L’abattement indiqué au deuxième alinéa ne peut être inférieur à 454 €, sans pouvoir excéder le montant brut des pensions et retraites.” Foreign pensions qualify for this allowance exactly like French pensions — the allowance attaches to the category, not the source — so a British SIPP drawdown of 30,000 euros gives a 3,000 euro allowance, while a large pension is capped at 4,439 euros per tax household. The allowance is automatic; you do not claim it, but you must declare the gross amount and let the computation apply it, which is why declaring net-of-UK-tax figures is a recurrent and costly error.
The lump sum then meets the quotient system, the mechanism French law provides so that one exceptional year does not push the whole amount into the top slice. The official service-public portal presents it as the “Quotient system (Article 163-0A)”, the statutory device for exceptional and deferred income, and the impots.gouv.fr portal maintains a dedicated revenus exceptionnels guide with the current declaration boxes. In substance the system divides the exceptional amount to compute the extra tax as if the income had been spread, then multiplies back — a calculation the online return performs once the income is flagged in the correct box. The trap is administrative, not mathematical: a lump sum entered as ordinary pension income is taxed in full at the marginal rate with no spreading, and the correction then requires a formal claim. Check the pre-filled return every spring, verify that UK pensions appear in salaries-and-pensions rather than in investment income, and confirm that any lump sum sits in the exceptional-income boxes with the quotient applied.
Declaration mechanics deserve a paragraph because most reassessments start here. Declare worldwide pensions on the main return, detail foreign-source pensions on the foreign-income annex (form 2047) with the country, the gross amount in euros and the UK tax paid, and carry the treaty-exempt or treaty-credit position through to the main form. Convert sterling with the annual average rate published by the administration or the Bank of France rate at payment, and keep one consistent method across years. Report death-benefit lump sums and trivial commutations in the year of payment, not the year of the provider’s statement. Keep the France Individual DT certificate, the HMRC PAYE coding notices, the P60s and the provider statements for at least the reclaim period, because the first question any inspector asks is what Britain already took. Readers who also receive the British State Pension will find its uprating, S1 and declaration position covered in our companion guide to the British State Pension in France.
A final domestic point: the progressive scale itself. Once the net pension enters the household base, the family quotient divides it into parts — Article 193 sets the parts mechanism and Article 197 the computation — so a married couple with no children divides by two and a widow or widower keeps the applicable parts. Pensioners who arrive mid-year are taxed on the whole year’s worldwide income if they are resident at 31 December, which makes an October arrival with a spring lump sum a particularly expensive combination. Time the lump sum, the arrival date and the first declaration as one decision, not three.
B. What social charges apply at 8.3 or 9.1 per cent, does an S1 change anything, and how do I challenge a reassessment or refusal?
Income tax is only half the French bill. Social charges (contributions sociales) apply on top, and their rates on pensions are fixed by statute. Article L.136-8 of the Social Security Code provides: “Sont assujetties à la contribution au taux de 8,3 % les pensions de retraite, et les pensions d’invalidité.” That 8.3 per cent is the CSG (contribution sociale généralisée) on retirement pensions at the full rate; reduced rates of 3.8 per cent and exemption exist for modest incomes measured against the Article 1417 reference income, so small British pensions may lawfully bear little or no CSG. The CRDS (contribution au remboursement de la dette sociale) at 0.5 per cent sits alongside, and the overall social-charge load on a full-rate pension is therefore 8.8 per cent before any solidarity additions — a figure to build into every net-income calculation.
The threshold question is who pays at all. Article L.136-1 of the Social Security Code institutes the contribution and makes liable “Les personnes physiques qui sont à la fois considérées comme domiciliées en France pour l’établissement de l’impôt sur le revenu et à la charge, à quelque titre que ce soit, d’un régime obligatoire français d’assurance maladie”. Both limbs must be met: French tax residence and coverage by a compulsory French health scheme. The second limb is where British pensioners holding an S1 healthcare certificate need careful analysis. An S1 holder is entitled to French healthcare with the cost borne by Britain, and the long-standing European case law on affiliation suggests such a person is not “à la charge” of the French scheme for the levies concerned — but the post-Brexit instruments replicate rather than copy the old coordination, and the French administration examines each file on its documents. Keep the S1, the CPAM registration, the PUMA affiliation decision and any A1 certificates together, never assume the exemption, and ask the CPAM and then URSSAF for a written position where the amounts justify it.
Capital-source income follows a different rate track that matters for SIPP wrappers holding French investments. Article L.136-6 of the Social Security Code subjects persons fiscally domiciled in France to the levy on property income, while Article 120 of the General Tax Code defines the dividends, interest and similar products that enter the investment-income category. Dividends paid inside a SIPP and left undrawn are not French investment income of the holder — the pension wrapper is transparent for treaty allocation but the income is the pension when drawn — whereas French dividends paid into an ordinary taxable account are. Do not let an inspector recharacterise undistributed SIPP growth as French investment income; the pension is taxed when paid out, as Article 79 says.
Exemptions exist at the margins and should be checked before they are claimed. Article 81 of the General Tax Code lists income freed from tax, and the treaty itself, in Article 19(4), shelters certain French public pensions from British tax where they are exempt in France — a niche but valuable protection for former French-service readers of this English-language page who also hold British rights. Claim an exemption only with the exact sub-paragraph in hand; “pensions are exempt” without a cited paragraph is how reassessments begin.
When the administration gets it wrong, the remedies are graduated and time-limited. Start with the online rectification or the written réclamation to the service des impôts des particuliers that issued the assessment, setting out the treaty article, the domestic article and the arithmetic, and join the France Individual DT certificate, the HMRC documents and the euro conversions. A silence of six months is an implied rejection that opens the tribunal. Escalate within the administration through the hierarchical appeal (recours hiérarchique) and the departmental conciliator where the dispute is factual — wrong amount, wrong box, missing quotient — and reserve the administrative court (tribunal administratif) for legal disputes: treaty interpretation, residence characterisation, refusal of the 10 per cent allowance on a foreign pension, or social charges levied despite the absence of French-scheme coverage. Appeal lies to the cour administrative d’appel and then, on points of law, to the Conseil d’État, the court that regularly polices the boundary between domestic qualifications and treaty concepts. Time limits are strict — generally 31 December of the second year following assessment for the réclamation — and payment of the disputed tax is in principle required pending the outcome unless a stay (sursis de paiement) with guarantees is obtained, so diary the dates before arguing the merits.
Three crisis patterns recur in our files. First, the double deduction that will not stop: PAYE continues after the France Individual DT is filed. Write to HMRC with the certified form and copy the French office, then claim repayment of the over-deducted months; if both states claim the same pension permanently, the mutual agreement procedure is the exit. Second, the missing quotient: the lump sum is assessed as ordinary income and the bill doubles. File a réclamation with the exceptional-income computation and the service-public presentation of the mechanism, and ask the conciliator to correct the box error without conceding the principle. Third, the blocked transfer: a UK provider refuses the QROPS move or applies the 25 per cent charge you believe is exempt. Demand written reasons, complain in writing through the provider’s formal process, take an unresolved complaint to the Pensions Ombudsman within its time limits, and separately verify the receiving scheme’s QROPS listing — an adviser who directed you to a non-listed scheme may carry the liability for the 40 per cent exposure. In each pattern, the file wins: dated letters, certificates, statements and conversions beat recollection every time.
Conclusion
A British private pension follows you to France but changes its tax nationality on arrival. Britain keeps the power to deduct at source until the treaty paperwork stops it, keeps 25 per cent of most QROPS transfers to a third country, and gives a tax-free lump sum that France does not replicate. France then taxes the pension as salary-like income with a 10 per cent allowance capped at 4,439 euros, spreads exceptional lump sums through the quotient system when correctly declared, and adds social charges at 8.3 per cent for full-rate pensioners within the French health system. The reader who sequences the decisions — residence date, lump-sum timing, transfer or drawdown, France Individual DT filing, correct declaration boxes — pays tax once, in the right country, at the right rate. The reader who improvises pays twice and litigates. Keep every certificate, convert carefully, check the boxes, and challenge early: the treaty, the code and the courts give you the tools, but only within their deadlines.