Your French company needs 40,000 euros next month to pay a supplier, cover payroll charges or top up a bank guarantee, and you live in London, New York, Dubai or Singapore. A French bank loan takes weeks, an increase of the share capital means new paperwork at the company formalities portal, and you simply want to wire your own money to your own company and get it back later, ideally with interest. French law gives you a purpose-built tool for exactly this situation: the shareholder current account, known in French as the compte courant d’associé. It is the amount of money a shareholder leaves at the disposal of the company on top of the share capital, and it works as a loan from you to your business. The catch is that the rules around repayment, interest, tax and insolvency are strict, and two recent court decisions show how quickly a poorly documented advance turns into a frozen claim or a personal liability case. This guide explains, for a foreign founder or foreign parent company running an SAS (société par actions simplifiée, the flexible joint-stock company most foreigners choose) or a SARL (société à responsabilité limitée, the limited liability company with stricter rules), how to fund the company from abroad, what to put in writing before wiring a single euro, how interest is capped and taxed, and how you recover your money if the company hits trouble.

I. How a foreign shareholder puts money into a French company without touching the share capital

A. When a foreign founder lends to a French SAS or SARL, the law treats the advance as a loan repayable on demand

The shareholder current account is not capital. The official business guidance published by the French administration describes it in plain terms: the person who makes the advance holds a claim against the company, recorded on the liabilities side of the balance sheet, and in general the conditions for repayment are set in the articles of association (the statuts, the contract that organises the company) or in a written current-account agreement between the company and the shareholder. Where neither document says anything, the administration states the default rule in English as follows: the claim of the shareholder against the company is refundable at any time, and once the shareholder asks for the money back, the company has a five-year period from the request to repay. In practice, French courts apply an even more direct version of this rule. The Paris Court of Appeal confirmed the point in a 15 May 2025 ruling (RG 24/05837): an advance characterised as a loan lets the shareholder freely choose the moment to demand repayment. That single sentence is the reason the current account is so attractive for a foreign founder: unlike a capital increase, which locks your money into the company and requires formal steps through the INPI single portal (the Institut national de la propriété industrielle, the public office that now centralises company registrations in France) and an updated Kbis extract (the extrait Kbis, the official identity card of a French company issued by the greffe, the registry office of the commercial court), a current-account advance can be wired this week and, in principle, claimed back whenever you need it.

The same Paris decision shows why the paperwork matters more than the principle. A director general of an SAS had left 30,000 euros in his shareholder current account and signed three documents tying that money up: a shareholder current-account blocking agreement with a pledge promise in favour of the lending bank, an amendment to the current-account contribution agreement, and a personal letter to the company. When the company removed him from office in February 2023, he demanded immediate repayment of the 30,000 euros, arguing that he had signed the blocking promise only in his capacity as shareholder and that losing that status after his removal released him from the promise. The commercial court agreed with him at first instance and ordered the company to pay. On appeal, Paris reversed the judgment entirely: the blocking promise had been given individually to the bank for four years, the bank confirmed in writing that every current account had to stay frozen until 28 February 2026, and the fact that the claimant had lost his shareholder status was, in the words of the court, irrelevant. The claim for early repayment was therefore rejected. For a foreign owner, the lesson is concrete. Before you wire funds from abroad, sign a written current-account agreement governed by French law that states the amount, the currency and exchange-rate rule, the interest rate or the absence of interest, the term, the repayment trigger, and whether the account is blocked and for how long. Keep the transfer proof showing the sender, the recipient company, the value date and a reference such as shareholder current-account advance, because the company accountant (the expert-comptable, the French chartered accountant who keeps the books) will need it to record the liability, and a future bank, buyer or insolvency practitioner will ask for it. If you are an individual rather than a company, remember one hard boundary: you may lend to your company, but your company may not lend to you. Article L. 223-21 of the Commercial Code provides, for the SARL, that “A peine de nullité du contrat, il est interdit aux gérants ou associés autres que les personnes morales de contracter, sous quelque forme que ce soit, des emprunts auprès de la société, de se faire consentir par elle un découvert, en compte courant ou autrement” (any loan by the company to an individual manager or shareholder is void), and Article L. 225-43 of the Commercial Code imposes the same ban in companies with a board of directors. A foreign parent company that is itself a legal entity is outside this ban, but an individual founder living abroad is caught by it: never use the company account as your personal wallet.

B. When a French bank asks you to freeze the money, the blocked current account becomes the bank guarantee

Foreign founders discover the blocked current account (the compte courant bloqué) at the worst possible moment: the French bank agrees to lend to the company only if the shareholders freeze their own advances for the duration of the loan. The administration describes the mechanism without ambiguity: to block a shareholder current account means that the company is no longer obliged to repay the funds contributed, and the frozen money then counts as stable, quasi-permanent resources of the business. The decision must be taken either unanimously by the shareholders or in a written blocking agreement signed between the company and the shareholder, and it commonly serves as security for bank lending. The Paris ruling of 15 May 2025 quoted above confirms the judicial side of the same logic: under a valid and clearly worded blocking agreement, the funds stay stabilised inside the company for the agreed fixed period. Three practical consequences follow for a founder wiring money from abroad. First, a blocking promise is enforceable even after you leave the company, as the Paris case proves, so never sign a bank blocking form at a distance without checking the duration, the release conditions and whether the bank and the company must both consent to any early repayment. Second, shareholders sometimes pledge the balance of their current account to the bank as collateral (the nantissement de compte courant), and the same ruling recalls that this pledge must be set down in writing to be valid and notified to the company to be enforceable against it, failing which only the shareholder himself validly receives payment. Ask for a countersigned copy of anything you sign and check that the company books record both the freeze and the pledge. Third, if the funder is not you as an individual but your foreign parent company, French law offers a dedicated channel: the ban on unauthorised banking does not prevent a company from carrying out treasury operations with companies linked to it by capital ties giving one of them effective control over the others, which is exactly the situation of a foreign mother company and its French subsidiary. Article L. 511-7 of the Monetary and Financial Code states this exception, whose first paragraph provides that “I. – Les interdictions définies à l’article L. 511-5 ne font pas obstacle à ce qu’une entreprise, quelle que soit sa nature, puisse : 1. Dans l’exercice de son activité professionnelle consentir à ses contractants des délais ou avances de paiement ; 2. Conclure des contrats de location de logements assortis d’une option d’achat ; 3. Procéder à des opérations de trésorerie avec des sociétés ayant avec elle, directement ou indirectement, des liens de capital conférant à l’une des entreprises liées un pouvoir de contrôle effectif sur les autres”. In English: the banking monopoly does not stop a business from running cash-pooling and treasury operations with companies it effectively controls. Document these intra-group advances as group treasury loans with market-rate interest and a written agreement, because the French tax administration reads undocumented transfers between a foreign parent and a French subsidiary through the lens of abnormal management decisions and transfer pricing rather than friendly help. Readers who are still choosing the vehicle for their French venture should first read our complete guide to setting up a company in France as a foreign founder, from bank account to Kbis, VAT and first hire, which maps the whole entry route that this article completes on the funding side.

II. How the foreign shareholder is paid, taxed and ranked if the company fails

A. How interest on a foreign shareholder advance is capped, deducted and taxed in France

Charging your own company interest from abroad is lawful, but the rate you write into the agreement decides who pays tax on what. French tax law caps the interest a company may deduct on money its shareholders leave at its disposal. Article 39, paragraph 1-3 of the General Tax Code allows the deduction of “Les intérêts servis aux associés à raison des sommes qu’ils laissent ou mettent à la disposition de la société, en sus de leur part du capital, quelle que soit la forme de la société, dans la limite de ceux calculés à un taux égal à la moyenne annuelle des taux effectifs moyens pratiqués par les établissements de crédit et les sociétés de financement pour des prêts à taux variable aux entreprises, d’une durée initiale supérieure à deux ans.” In English: interest paid to shareholders on top of their capital share is deductible only up to the average annual rate banks charge companies for variable-rate loans of more than two years, a reference rate published quarterly by the Banque de France, and only if the share capital has been fully paid up. The administration adds two operational details that foreign owners often learn too late: each current account is tested separately, with no offset between an over-remunerated account and an under-remunerated one, and any excess over the cap becomes a non-deductible expense of the company while remaining taxable in the hands of the recipient. Where the lender is a related company, a second ceiling applies under Article 212 of the General Tax Code, which keeps interest on sums made available by an associate company or a related company deductible only within the Article 39 reference rate or, if higher, within the rate the borrowing company could have obtained from independent banks in similar conditions. In plain terms: a foreign parent company that funds its French subsidiary at 8 percent while French banks would lend the subsidiary at 4 percent should expect the excess to be added back to the taxable profit of the French company, with late-payment interest and penalties on reassessment. Draft the rate clause by reference to the published quarterly average rather than a round number invented in the home country, and revisit it every year, because the cap moves with the market.

On the recipient side, the French treatment depends on who you are. The administration confirms that interest received by an individual shareholder is investment income (revenus de capitaux mobiliers), taxed either under the single flat-rate levy (the prélèvement forfaitaire unique, the PFU, a one-shot levy that replaces the progressive income-tax scale on savings income) or, on election, under the progressive income-tax scale, while interest received by a shareholder company subject to French corporation tax (the impôt sur les sociétés, IS) is financial income taxed with its other profits. A founder who lives abroad must add one more layer to the analysis: France may levy a withholding tax on interest paid to a non-resident lender, and the applicable tax treaty between France and the country of residence may reduce or remove it, which is why the agreement should state who bears any withholding and require the company accountant to check the treaty position before the first interest payment. The company itself carries a yearly paperwork duty: because a current-account advance is legally a loan, the borrowing company must file an annual loan-agreement declaration (currently form 10142) by the filing date of its yearly results return, a point the administration states expressly for current-account advances. From abroad, the discipline is therefore simple: sign the agreement before the wire, set the rate at or below the published reference average, confirm the capital is fully paid up, calendar the annual loan declaration with the accountant, and have the treaty position on interest cleared before the first coupon. Skip any of these steps and the advance still exists as a claim, but part of its interest cost becomes dead money: non-deductible for the company, taxable for you, and documented nowhere.

B. How a foreign shareholder gets the advance back when the company is in difficulty or goes bust

As long as the company is solvent and the account is not blocked, the rule is strikingly protective of the lender: when the shareholder asks for repayment, the company cannot refuse, even by pleading cash-flow problems, and it cannot unilaterally cap repayment at whatever its treasury can bear. The only relief the company may seek is a court-ordered grace period. Article 1343-5 of the Civil Code provides that “Le juge peut, compte tenu de la situation du débiteur et en considération des besoins du créancier, reporter ou échelonner, dans la limite de deux années, le paiement des sommes dues.” In English: the judge may defer or spread payment over up to two years, weighing the debtor situation against the creditor needs. A foreign shareholder who receives a summons or a conciliation proposal offering instalments should therefore read it as normal French procedure, not as a refusal to pay, while a company that wants time must ask a judge rather than simply stop answering emails. Before any conflict, one piece of corporate housekeeping protects both sides: shareholder loans are regulated agreements (conventions réglementées) in most French companies. In a SARL, Article L. 223-19 of the Commercial Code requires the manager or the statutory auditor (the commissaire aux comptes, the independent auditor who certifies the accounts of larger companies) to present a report on agreements between the company and one of its managers or shareholders, with the interested person excluded from the vote, and Article L. 227-10 of the Commercial Code organises the equivalent report to the shareholders of an SAS on agreements with the president, a senior manager or a shareholder holding more than 10 percent of the voting rights. In a company with a board of directors, Article L. 225-38 of the Commercial Code goes further and requires prior authorisation by the board, granted on a reasoned decision explaining the interest of the agreement for the company. Unapproved agreements still bind the company, but the interested shareholder bears the harmful consequences, so a foreign founder who lends without putting the agreement to a vote keeps the claim yet inherits the risk. Hold the vote, even by written consultation from abroad, file the report with the annual accounts, and mention sole-shareholder agreements in the decision register (the registre des décisions, the minute book where a single shareholder records company decisions).

Once a collective insolvency proceeding opens (redressement judiciaire for rescue, liquidation judiciaire for winding up), the music stops. From publication of the opening judgment, the company may no longer repay any shareholder current account, and the foreign shareholder must declare the claim like any other creditor with the court-appointed receiver (the mandataire judiciaire, the officer who represents creditors) or liquidator, within the statutory deadline. Article L. 622-24 of the Commercial Code requires every creditor whose claim arose before the opening judgment, except employees, to declare it to the receiver, and the administration warns shareholder lenders expressly: after the opening, the shareholder is repaid only after the preferential creditors and only if the company finances allow. Shareholder current accounts rank at the bottom of the waterfall, which is exactly why banks demand they be blocked in the first place. The most recent word from the Cour de cassation (the French supreme court for civil and commercial matters) sharpens the warning for owner-managers. On 9 September 2026, in a decision published for the Bulletin (the official reporter of leading rulings), the Commercial Chamber upheld a finding that repaying shareholder current accounts while the company cash position was already critical proved a misuse of company assets. The court endorsed the appeal judges who had held that “la souscription d’un nouveau prêt pour rembourser les comptes courants d’associés du dirigeant et de son épouse, au lieu d’abonder la trésorerie, démontrent un usage des biens de la société contraire à l’intérêt de la société dont l’exploitation était déjà déficitaire” (borrowing anew to repay the manager and spouse shareholder accounts instead of funding working capital showed a use of company assets against the interest of an already loss-making business), a fault that helped send the shortfall to the manager personally under the liability action for insufficiency of assets. Read the full ruling here: Cour de cassation, Commercial Chamber, 9 September 2026, appeal No. 24-22.135. The same ruling settles a procedural point worth knowing: creditors appointed as controllers (the contrôleurs, creditors the court nominates to supervise the receiver) may bring that liability action only as a fallback, after a formal demand to the liquidator has gone nowhere, because Article L. 651-3 of the Commercial Code lets the court be seised “par la majorité des créanciers nommés contrôleurs lorsque le liquidateur n’a pas engagé l’action prévue au même article, après une mise en demeure restée sans suite”. For the foreign shareholder, the conduct rules are therefore clear: never drain the company to repay your own account when the accounts already show strain, never skip the claim declaration after an opening judgment, and never assume that distance protects you, because the liability action under Article L. 651-2 of the Commercial Code reaches any de jure or de facto manager whose management fault contributed to the asset shortfall, including a foreign owner who actually runs the business from abroad.

Conclusion

Funding a French SAS or SARL from abroad through a shareholder current account remains the fastest and most flexible route: no capital increase, no registration queue, a claim that is repayable on demand by default, and interest that the company can deduct within the published reference rate. The price of that flexibility is paperwork signed before the wire, a blocking promise never given lightly, a rate clause indexed on the Banque de France average, an annual loan declaration filed by the company, and regulated-agreement votes held even at a distance. Above all, the advance must stay what it claims to be: a documented loan serving the company interest. The September 2026 case law shows that advances repaid at the wrong moment, to the wrong person, become evidence of mismanagement rather than proof of commitment. Lend cleanly, from a company account to the company account, with a written agreement, a reasoned rate and a declared claim if insolvency strikes, and the current account does exactly what foreign founders need: it puts cash where the business is while keeping a clear, enforceable road home for the money.

Need a quick opinion on your case

You run a French company from abroad and need to fund it, secure an advance or recover a shareholder loan. Get a telephone consultation within 48 hours with a lawyer of the firm. Call +33 6 46 60 58 22 or reach us through our contact page.