Your French company has closed a profitable year. The money sits in the French bank account, you live in London, New York, Dubai or Singapore, and you now ask the only question that matters: how do I lawfully bring that profit home. The answer runs through three checkpoints that foreign shareholders often discover too late. First, no euro can leave the company as a dividend without a valid vote of the shareholders approving the annual accounts. Second, once voted, the dividend must actually be paid within nine months of the financial year end, and any shortcut around that vote can be annulled or even punished as a criminal offence. Third, France taxes the payment before it crosses the border: a withholding tax applies to dividends paid to shareholders who live abroad, unless a tax treaty or a European exemption removes or reduces it. This guide walks you through each checkpoint in order, with the exact articles of the Commercial Code and the Tax Code that govern your case, two recent rulings of the Cour de cassation that show how courts apply them, and the practical filings your French accountant will expect from you.

I. Vote the Dividend Lawfully Without Flying to France

Many foreign founders treat the dividend as a simple bank transfer they can order from abroad. French company law treats it as the final step of a formal annual ritual: closing the accounts, approving them in a shareholders’ meeting, checking that something is actually available for distribution, and only then voting the dividend. Skip one step and the payment can be reclaimed, taxed as something else, or cancelled by a court at the request of a co-shareholder, a creditor or a buyer of your shares. The good news is that every step can be completed from abroad, provided you respect the forms.

A. How foreign shareholders approve the accounts and vote the dividend from abroad

Everything starts with the annual accounts. Each year, the president of your SAS (société par actions simplifiée, the flexible joint-stock company most foreigners choose) or the gérant (manager) of your SARL (société à responsabilité limitée, the limited liability company with stricter statutory rules) must draw up the inventory, the balance sheet, the profit-and-loss statement and the notes, then submit them to the shareholders for approval. That approval is given by the AG, the assemblée générale, meaning the collective decision of the shareholders, whether they meet physically in Paris or vote in writing from abroad. Your articles of association, the statuts, normally allow remote consultation, videoconference and written votes, and for a company you own entirely, you simply sign the minutes yourself as sole shareholder, a procès-verbal d’associé unique, and send it to your accountant.

Once the accounts are approved, the meeting must check that a distributable profit exists. Article L. 232-11 of the Commercial Code defines the test in these terms: “Le bénéfice distribuable est constitué par le bénéfice de l’exercice, diminué des pertes antérieures, ainsi que des sommes à porter en réserve en application de la loi ou des statuts, et augmenté du report bénéficiaire.” In plain English, you take the profit of the year, subtract past losses and the mandatory allocations to reserves, and add any retained earnings carried forward from earlier years. Only that basket can be distributed. The same article adds a hard floor: no distribution is allowed if the equity, the capitaux propres, would fall below the share capital plus the reserves that the law or the articles forbid distributing. Your accountant computes this before any vote, and you should ask for that computation in writing, because voting a dividend above the distributable amount exposes the directors to personal liability and the payment to recovery.

The vote itself belongs to the shareholders, not to the director. Article L. 232-12 of the Commercial Code states: “Après approbation des comptes annuels et constatation de l’existence de sommes distribuables, l’assemblée générale détermine la part attribuée aux associés sous forme de dividendes.” The meeting that approves the accounts therefore decides, in the same sitting, how much of the profit goes to dividends, how much goes to reserves and how much is carried forward. In practice, your French lawyer or accountant circulates draft minutes in English with the French resolutions, you sign, and the minutes are filed in the company register. The greffe, the registry office of the commercial court that keeps the RCS (registre du commerce et des sociétés, the French companies register that issues your Kbis company identity certificate), does not need to approve the dividend for it to be valid between shareholders, but the accounts themselves must later be filed, and the tax return must reflect the distribution.

A recent ruling of the Cour de cassation shows why the form of the vote matters as much as the figures. On 12 February 2025, the Commercial Chamber, in case number 23-11.410, a decision published in the official Bulletin, recalled the governing principle in these words: “Il résulte de la combinaison de ces textes que les délibérations d’une société commerciale s’imposent aux associés tant que la nullité n’en a pas été prononcée.” A company resolution binds everyone until a court annuls it. The same decision then drew the consequence for dividends paid out of retained earnings: “que le report bénéficiaire d’un exercice est inclus dans le bénéfice distribuable de l’exercice suivant et que, par voie de conséquence, seule l’assemblée approuvant les comptes de cet exercice pourra décider son affectation et, le cas échéant, sa distribution.” Only the meeting that approves a given year’s accounts can allocate that year’s retained earnings. In that case, sellers had voted a dividend out of earlier retained earnings in a separate meeting after closing the sale of the shares, and the buyers challenged the payment. Foreign shareholders should read this twice: if you sell your French company, or if you hold an extraordinary meeting from abroad to take cash out between two year ends, make sure the meeting voting the dividend is the one entitled to do so, or the buyer, or a minority shareholder, can have the whole distribution annulled years later.

From abroad, the practical checklist is therefore short but strict. Confirm with your accountant that the draft accounts show a distributable profit after losses and legal reserves. Check your statuts for the allowed voting method, written consultation or videoconference, and for the majority required. Sign minutes that mention the approval of the accounts, the finding that distributable sums exist, and the exact dividend per share with its payment date. Keep the signed minutes, the accounts and the bank proof together: your French bank, the tax office and any future buyer will ask for them. If several shareholders live in different countries, appoint one person to collect the signatures and return a single certified set to France.

B. When the money must actually reach you and what happens if you improvise

Voting the dividend creates a debt of the company toward each shareholder. French law then imposes a deadline for paying it. Article L. 232-13 of the Commercial Code provides: “Toutefois, la mise en paiement des dividendes doit avoir lieu dans un délai maximal de neuf mois après la clôture de l’exercice. La prolongation de ce délai peut être accordée par décision de justice.” The dividend must be paid within nine months of the year end, and only a court can extend that period. For a company closing on 31 December, payment must therefore reach the shareholders by 30 September of the following year at the latest. The meeting sets the payment terms or delegates them to the president or the gérant, and the transfer is wired to the shareholder’s account, in France or abroad, with the withholding tax, where applicable, deducted at source and sent to the French Treasury.

Between two year ends, a profitable company may also pay an acompte sur dividende, an interim dividend, an advance on the final dividend voted before the accounts are closed. The Commercial Code allows it only on the basis of an interim balance sheet certified by the commissaire aux comptes, the statutory auditor, showing a profit after depreciation, provisions, past losses and mandatory reserves. Small foreign-owned companies often have no statutory auditor, which in practice closes that route: without certification, no lawful interim dividend. If you need cash during the year, the cleaner tools are a monthly remuneration for your French director’s office, which is taxed as salary, or a temporary shareholder current-account advance, a compte courant d’associé, which must be documented, bear a lawful interest rate and be repaid, never confused with a dividend.

The criminal courts punish improvisation harshly. On 12 June 2025, the Criminal Chamber of the Cour de cassation, in case number 24-81.263, reviewed a case in which company officers had presented inaccurate accounts and distributed money that did not correspond to real profits. The Bordeaux appeal court, whose ruling was under review, had, in the words of the judgment, “qui a condamné le premier, pour faux et complicité de répartition de dividendes fictifs, à 15 000 euros d’amende, le second, pour répartition de dividendes fictifs, faux et usage, à six mois d’emprisonnement avec sursis et une confiscation”. One defendant received a 15,000 euro fine for forgery and complicity in distributing fictitious dividends, the other a six-month suspended prison sentence with confiscation for distributing fictitious dividends, forgery and use of forged documents. Distributing dividendes fictifs, dividends paid out of non-existent profits on the basis of false balance sheets, is a criminal offence for managers, and the accountants or advisers who help dress the figures can be convicted alongside them. For a foreign shareholder, the lesson is direct: never order your French manager to pay a dividend the accounts do not support, never sign minutes showing profits you have not verified, and never treat a current-account withdrawal as a dividend after the event.

Payment mechanics from abroad deserve the same care. The dividend is paid net of any French withholding, and the company files the corresponding return and pays the Treasury. Keep the bank transfer reference mentioning dividends and the financial year, because your home country’s tax office will ask for proof that the income is a dividend and not a salary or a capital gain. If the nine-month deadline cannot be met, because a shareholder dispute or a blocked bank account freezes the payment, ask your French lawyer to petition the president of the commercial court for an extension before the deadline expires, rather than paying late silently. And if the company later discovers the dividend exceeded the distributable amount, the action for recovery, the action en restitution, runs against the shareholders who received it, wherever they live.

II. Keep More of the Dividend: French Tax, Withholding and Repatriation

France taxes company profits twice in the standard case: once at the company level through corporate income tax, and once at the shareholder level when the dividend is paid. For a shareholder living abroad, the second layer takes the form of a withholding tax deducted in France before the money leaves. Treaties and European exemptions can remove or reduce that second layer, but they never apply automatically. You must claim them with the right certificate, the right form and the right timing, or the full rate applies and you fight for a refund later. This second part maps the tax path of your dividend from the French profit to your foreign account.

A. How France withholds tax on dividends paid to shareholders living abroad

The starting point is the profit itself. Article 219 of the CGI (Code général des impôts, the French tax code) provides: “Le taux normal de l’impôt est fixé à 25 %.” French companies pay corporate income tax, the IS (impôt sur les sociétés), at the standard rate of 25 percent on their taxable profit, after the advance instalments, the acomptes, paid during the year to the SIE (service des impôts des entreprises, the corporate tax office). A dividend can only be paid out of after-tax profit, and the 25 percent is already gone before the distribution is even discussed. This matters for foreign founders comparing France with lower-tax jurisdictions: the dividend you receive has already borne French corporate tax, and the withholding described below comes on top, before treaties or exemptions soften it.

For shareholders without a French tax residence, the CGI imposes a levy at the moment the dividend crosses the border. Article 119 bis of the CGI states that investment income of the kind it lists “donnent lieu à l’application d’une retenue à la source”, gives rise to a withholding tax, when the beneficiary has its seat or tax domicile outside France. Article 187 of the same code then fixes the machinery: “le taux de la retenue à la source prévue à l’article 119 bis est fixé à”, the rate of the withholding provided for by Article 119 bis is set at the levels that follow in the article. For dividends paid to foreign companies, the headline French domestic rate is currently 25 percent, aligned with the corporate tax rate, while dividends paid to foreign individuals face the rates set by the same article, subject in every case to the tax treaty between France and your country of residence, which often brings the rate down to 15, 10, 5 or even zero percent for substantial corporate shareholders.

The treaty reduction is never spontaneous. Your French company, as the paying agent, must hold a certificate of tax residence of the beneficiary, issued by your home tax authority, covering the year of payment, before applying the reduced treaty rate. Without that certificate on the day of payment, the company must withhold at the full domestic rate, and you recover the difference later by filing a refund claim with the French tax office, a slower and document-heavy procedure. The withholding is declared and paid through the printed form 2777-SD, the relevé de retenues à la source, filed electronically by the company or its accountant in the month following the payment. Ask your accountant for a copy of the filed 2777 and of the payment receipt: your home-country bank and tax adviser will need them to credit the French tax against your local tax or to justify the exemption.

For comparison, the official service-public business portal explains the domestic baseline that applies to French-resident shareholders, which helps foreign readers understand what they are exempt from or compared with. Dividends received by a shareholder who is an individual resident in France first suffer a non-discharging flat-rate levy of 12.8 percent on the gross amount, deducted by the institution paying the dividends, before the final settlement at the yearly income tax return, where the single flat-rate levy, the PFU (prélèvement forfaitaire unique), stands at 31.4 percent, combining 12.8 percent income tax and the social charges. As a non-resident, you are outside that domestic PFU mechanism: your dividend suffers the withholding tax instead, and the social charges component does not apply to you in the same way, which is precisely why the treaty rate and the European exemptions below are worth claiming. The tax office’s international desk for individuals publishes its own guidance on dividends received from France, and your adviser should reconcile the company’s 2777 filing with that guidance before you file at home.

Two practical traps catch foreign shareholders every year. The first is the shareholder current account: money wired abroad and booked as a current-account repayment but actually representing profit is reclassified as a disguised dividend, a distribution occulte, and taxed as a dividend with penalties, sometimes years later during a tax audit, a vérification de comptabilité. The second is the management fee or royalty invoiced by your foreign holding to your French company to empty the profit without voting a dividend. The French tax office can reclassify excessive or unjustified fees as indirect distributions and apply the same withholding, plus penalties. If the profit is meant for you, vote it openly as a dividend, withhold correctly, and keep the treaty certificate: the clean route is almost always cheaper than the reclassified one.

B. The European exemption and the French parent-subsidiary regime for your holding company

If your French company is owned by a company established in the European Union or the European Economic Area, European law offers a powerful relief: no French withholding at all, provided the conditions are met. Article 119 ter of the CGI transposes that relief and states: “La retenue à la source prévue au 2 de l’article 119 bis n’est pas applicable aux dividendes distribués à une personne morale qui remplit les conditions énumérées au 2 du présent article par une société ou un organisme soumis à l’impôt sur les sociétés au taux normal.” The withholding simply does not apply to dividends paid by a French company subject to corporate tax at the standard rate to a legal entity meeting the listed conditions. Those conditions, verified by your adviser against the full text of the article, include the parent being the beneficial owner of the dividends, having its effective seat of management in a Member State of the European Union or the European Economic Area with a tax assistance treaty with France, holding the required level of participation, keeping it for the required period, and being subject to corporate tax without exemption. Each condition must be documented to the paying company before the payment: beneficial ownership, seat, holding rate and duration, taxable status.

The French parent-subsidiary regime, the régime mère-fille, completes the picture on the receiving side. When a French parent collects dividends from its French or foreign subsidiary, Article 216 of the CGI allows it to deduct the net dividend income from its own taxable profit, except for a fixed portion representing expenses, and provides: “La quote-part de frais et charges prévue au premier alinéa du présent I est fixée à 5 % du produit total des participations, crédit d’impôt compris.” Only 5 percent of the dividend, tax credit included, stays taxable at the parent level, which makes France an efficient location for a European holding company above your operating subsidiary. For groups that integrate their French companies fiscally, the intégration fiscale of Article 223 A of the CGI, which lets a parent become solely liable for corporate tax on the whole group formed with subsidiaries held at 95 percent or more, that taxable portion can even fall to 1 percent for dividends inside the integrated group. Foreign founders often hesitate between holding the French operating company directly from abroad and inserting a French or European holding in between: the 5 percent, or 1 percent inside a tax group, is the number that decides many of those structures.

Outside Europe, the applicable relief is the bilateral tax treaty. France has treaties with most countries, and the dividend article typically caps the French withholding at 15 percent for portfolio shareholders and 5 percent, sometimes zero, for corporate parents holding a substantial stake, often 10 percent of capital, directly. Claiming it requires the residence certificate mentioned above and sometimes a specific treaty form exchanged between tax offices. American, British, Emirati, Singaporean and Canadian readers should note that each treaty has its own holding thresholds, limitation-on-benefits clauses and procedural forms, so the generic statement that the treaty reduces the rate must always be verified against the treaty text in force on the payment date. Your French accountant applies the rate, but the certificate comes from you, from your home tax office, in time.

The calendar ties the corporate vote and the tax claim together. Approve the accounts and vote the dividend within six months of the year end, pay within nine months, file the withholding return in the month after payment, and file the annual corporate tax return, the liasse fiscale, through your accountant within the statutory deadline following the year end. File the accounts with the greffe for publication, keeping in mind that small companies can request confidentiality of the profit-and-loss statement, and report the dividend in your home country, claiming the French tax credit or exemption under your local rules. The BODACC (Bulletin officiel des annonces civiles et commerciales, the official gazette publishing company notices) does not publish your dividend, but it publishes the life events of your company, capital changes, transfers of seat, dissolutions, that surround the distribution and that future counterparties will check.

Conclusion

Taking profit out of your French company from abroad is a procedure, not a transfer. Approve the accounts in a valid meeting, check the distributable profit under Article L. 232-11, vote the dividend under Article L. 232-12, pay it within the nine months of Article L. 232-13, withhold under Articles 119 bis and 187 unless the European exemption of Article 119 ter or your tax treaty applies, and document every step for the 2777 filing and your home-country return. The two court decisions quoted above frame the risk symmetrically: a resolution binds everyone until annulled, so a defective vote poisons the payment for years, and fictitious dividends lead managers and their accomplices to fines, suspended prison and confiscation. With signed minutes, a certified distributable amount, a residence certificate obtained before payment and a filed withholding return, the same operation becomes routine, repeatable every year, and fully defensible in an audit. Prepare the certificate early, diary the nine-month deadline from the day the year closes, and have your accountant reconcile the vote, the wire and the filing before the money moves.