You have settled in France after Brexit, you are French tax resident, and you have just sold — or are about to sell — the house or flat you still owned in England, Scotland, Wales or Northern Ireland. Two tax authorities now look at the same sale: HM Revenue and Customs in the United Kingdom, because the bricks and mortar stand on British soil, and the French tax administration, because you live in France and France taxes its residents on their worldwide gains. Many British sellers discover this double claim only when the French tax office sends a reassessment, sometimes years later, with income tax, social charges, a surtax on high gains and late-payment penalties. This guide explains, step by step, which country taxes what, how the France–United Kingdom double tax treaty of 19 June 2008 divides the gain, how France calculates the taxable amount and grants a tax credit for the British tax, which returns you must file and within which deadlines on each side of the Channel, and how to challenge an excessive or doubly-taxed bill. Every French legal term is explained as it appears, all decisive propositions rest on statutory texts and published case law quoted word for word, and the practical lessons come from a real court decision about a French resident who sold a house in London.

I. Your UK House Sale Remains Taxable in Two Countries When You Live in France

A. The Treaty Gives the United Kingdom the First Right to Tax, Without Removing France

The starting point is your French tax residence. Under Article 4 A of the French General Tax Code, “Les personnes qui ont en France leur domicile fiscal sont passibles de l’impôt sur le revenu en raison de l’ensemble de leurs revenus.” In plain English: a person whose tax home is in France is liable to French income tax on the whole of their income — and, by extension, on worldwide capital gains, including the gain on a house in London, Manchester, Edinburgh or Belfast. Your domicile fiscal (tax home) is defined by Article 4 B of the same 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”. If your family home (foyer) or your main place of stay is in France, you are French tax resident even though you kept a British passport and a UK property. The French administration confirms this worldwide logic for sellers: impots.gouv.fr explains that a French resident selling a building abroad is, absent a treaty, taxed just as if the property stood in France; that treaties normally give the State where the building stands the right to tax the gain; and that a treaty may also preserve taxation in France on top of taxation in the State where the property is located.

That treaty is the Convention between France and the United Kingdom signed in London on 19 June 2008, published by Decree No 2010-20 of 7 January 2010. Its capital gains article is Article 14, whose first paragraph reserves the taxation of gains from immovable property to the State where the property is located. Your UK house is an immeuble (real property) situated in the United Kingdom, so the gain is taxable there: the United Kingdom has the primary right to tax it under its own capital gains tax rules for non-residents. This is not an exemption for France. The treaty lets the United Kingdom tax the gain first, and then organises how France taxes it again while eliminating the resulting double taxation through a credit mechanism described in Part II. One further treaty subtlety deserves attention if you left the United Kingdom recently. Paragraph 6 of the same Article 14 preserves a six-year tail, leaving each contracting State free to tax under its domestic law gains realised by a person who is resident there in the year of disposal or was resident there at any time during the previous six tax years. In practice, if you were UK resident at any point in the previous six tax years, British law may still catch the disposal even after your departure, alongside French taxation. Readers facing the mirror situation — UK residents selling a French holiday home — will find it analysed in our companion guide on selling a French holiday home as a UK resident, where the roles of the two States are reversed.

On the British side, the compliance burden is immediate and strict. Since 6 April 2020, GOV.UK requires vendors to report and pay any Capital Gains Tax due on UK residential property within 60 days of completion of the sale. The same page warns that interest and penalties apply for late reporting and payment. This is the UK Capital Gains Tax on UK property return — a standalone online filing with HMRC, separate from the annual Self Assessment return, due within 60 days of completion (the legal transfer, not the exchange of contracts). You must file it even where computations show little or no tax, because losses, reliefs such as Private Residence Relief for periods when the house was your main home, and the annual exempt amount must be declared to be recognised. Keep the completion statement from your solicitor or licensed conveyancer, the original purchase price in pounds sterling, improvement invoices, and evidence of periods of occupation and letting: the French administration will later ask for the same documents, and consistency between the two files is your best protection against a challenge on either side.

B. Your London House Is Not Your French Main Home: the Exemption That Fails

The most expensive mistake British sellers make is assuming that the house they just sold was their résidence principale (main home) and therefore exempt. French law does exempt the main home: Article 150 U of the General Tax Code taxes gains on buildings and land, but its paragraph II lists property “Qui constituent la résidence principale du cédant au jour de la cession”. The exemption turns entirely on one factual question: was the sold property your main, habitual, effective home on the day of the sale? A published judgment of the Lyon Administrative Court of Appeal answers that question for facts almost identical to yours, and the seller lost. In CAA Lyon, 27 April 2023, No 21LY03673, “l’administration a taxé à l’impôt sur le revenu la plus-value immobilière réalisée lors de la cession par l’intéressé, le 10 février 2014, d’un immeuble à Londres (Royaume-Uni) au prix de 618 000 livres sterling, soit 741 600 euros après conversion.” The seller argued that the London house had been his main home because he only became French resident again in 2014, kept declaring French-source income to the non-residents tax office until 2013, and still received personal post in London until February 2014. The court examined the whole picture and concluded: “Par suite, les éléments avancés par M. A… ne sauraient suffire à établir que l’immeuble londonien constituait sa résidence principale au jour de la cession.”

Why did his evidence collapse? Because the administration proved, as the Lyon court records, through international administrative assistance, that the London house had been let in 2010, 2011 and 2012, while the taxpayer’s 2013 and 2014 French returns gave an address in Isère, his future wife declared the same French address, and three notarial deeds from 2011 to 2013 for seasonal-rental flats described the couple as residing in that French mountain village. Three lessons follow for your file. First, letting the property in the years before the sale destroys the main-home narrative: a rented house cannot be your habitual home. Second, the address on your French tax returns, your spouse’s returns, utility bills, council tax records and notarial deeds outweigh a forwarding address or a few retained letters. Third, the court accepted that France could tax the gain at all — the seller, tellingly, did not even dispute that France could tax the gain at all — M. A…, “qui ne conteste pas que la plus-value en litige pouvait être imposée en France”. So if you already live in Paris, Lyon, Nice or a Dordogne village when you sell the UK house, do not claim the main-home exemption for it. Narrower exemptions exist in French law — for elderly or disabled sellers of modest means, for a first sale followed by reinvestment in a main home within 24 months, for sales below 15,000 euros — but each carries strict conditions of income, disability status, timing and reinvestment that rarely fit a British family selling a UK house from France. Claim one only with documentary proof for every condition, because an unjustified exemption draws the 40% deliberate-failure surcharge examined in Part II.

II. France Calculates the Gain in Euros, Credits the British Tax and Polices the Return

A. Computing the Gain, Converting the Pounds and Crediting the UK Tax

The French calculation starts from a simple statutory formula. Under Article 150 V of the General Tax Code, “La plus ou moins-value brute réalisée lors de la cession de biens ou droits mentionnés aux articles 150 U à 150 UC est égale à la différence entre le prix de cession et le prix d’acquisition par le cédant.” Sale price minus purchase price. For a UK property, both prices were paid in pounds sterling, and the Lyon court states the conversion rule you must apply: prices “en euros, le cas échéant en convertissant en euros, sur la base des taux de change applicables respectivement à la date d’acquisition ou de cession, les prix qui ont été réglés au moment de ces opérations en devises.” Each price is converted at the exchange rate on its own date — purchase price at the rate on the purchase date, sale price at the rate on the sale date. The consequence is decisive and often misunderstood: “les gains ou pertes de change pouvant être constatés lors de cessions de biens immobiliers constituent une composante des plus ou moins-values brutes réalisées et sont pris en compte pour la détermination des sommes imposables en application de l’article 150 U du code général des impôts.” If sterling strengthened against the euro between your purchase and your sale, the currency gain increases your French taxable gain even though the pound-denominated profit looks smaller; if sterling fell, the currency loss reduces it. In the Lyon case the administration had converted the 1995 purchase price at the rounded 10 January 1995 rate of 1.24 euros to the pound, and the court approved it, while rejecting the taxpayer’s alternative rate. Use the official daily rate for each date, keep a printed record, and never net off later currency movements between payment of a deposit and completion.

Family history complicates the purchase price further. Many British sellers bought the UK house jointly with a former spouse and later bought out the ex-partner’s share with a balancing payment — the soulte — when the marriage ended. The Lyon seller argued exactly that: his 2003 buyout of his ex-wife’s rights for 100,000 pounds should increase his acquisition price. French law refused, through the effet déclaratif (declaratory effect) of matrimonial partitions. Article 150 U, paragraph IV provides: “Le I ne s’applique pas aux partages qui portent sur des biens meubles ou immeubles dépendant d’une succession ou d’une communauté conjugale et qui interviennent uniquement entre les membres originaires de l’indivision, leur conjoint, des ascendants, des descendants ou des ayants droit à titre universel de l’un ou de plusieurs d’entre eux.” The court drew the full consequence: the partition is not treated as a transfer, the recipient is deemed to have owned the whole property since the community began, and the later sale’s acquisition price is the property’s value when it entered the community — the original 165,000 pounds — with no addition for the soulte paid to the ex-spouse. Check, therefore, whether your buyout fell under a French-recognised matrimonial partition or under English divorce law applied by an English court: the characterisation changes the acquisition price by tens of thousands of pounds, and you should have the divorce order, the transfer deed and the valuation evidence reviewed before filing rather than after a reassessment.

Once the gross gain in euros is fixed, French law applies holding-period relief (abattements pour durée de détention), then three layers of tax. The abatement extinguishes income tax after 22 years of ownership and social charges after 30 years; between those points, partial yearly percentages apply, and improvement costs and purchase expenses can be added to the acquisition price under fixed allowances. The resulting net gain bears income tax at 19%, social contributions on capital income — “Les personnes physiques fiscalement domiciliées en France au sens de l’article 4 B du code général des impôts sont assujetties à une contribution sur les revenus du patrimoine assise sur le montant net retenu pour l’établissement de l’impôt sur le revenu” — at the combined rate of 17.2%, and, for net gains above 50,000 euros, the surtax on high property gains of 2% to 6%. None of this is reduced by the fact that the United Kingdom already taxed the same gain; it is neutralised, instead, by the treaty credit. The administration confirms that a tax credit may then be deducted from the French tax. Article 24, paragraph 3(a) of the 2008 treaty provides that “nonobstant toute autre disposition de la présente Convention, les revenus qui sont imposables ou ne sont imposables qu’au Royaume-Uni conformément aux dispositions de la présente Convention sont pris en compte pour le calcul de l’impôt français lorsqu’ils ne sont pas exemptés de l’impôt sur les sociétés en application de la législation interne française.” You declare the worldwide income, France computes its tax, and then grants a credit equal to the French tax attributable to the UK gain — capped at the French tax, so any excess British tax is not refunded. The Conseil d’État clarified three points that protect you in an avis of 12 February 2020, No 435907 on this very treaty. First, the credit also covers the French social contributions, because they form part of the French tax defined by the treaty, and France cannot deny the credit on the ground that the United Kingdom levies no equivalent charge. Second, “Aucune des stipulations du (i) du a) du paragraphe 3 de l’article 24 de la convention ne permet de restreindre le bénéfice du crédit d’impôt égal au montant de l’impôt français aux seuls revenus relevant d’un barème progressif d’imposition.” Proportional taxes such as the 19% flat levy qualify too. Third, the condition of being subjected to United Kingdom tax means the income must fall within the base of a British tax listed in the treaty — “cette condition n’exige pas que les revenus en cause aient été soumis à une imposition effective.” Declare the gain to HMRC, even if British reliefs reduce the British bill to zero, and the French credit remains available. Conversely, gains that the United Kingdom exempts entirely from its tax base for reasons of personal status may fail the test — another reason to file the British return properly rather than ignoring it.

B. Filing on Both Sides on Time and Challenging an Unfair Bill

French filing for a foreign property sale surprises British sellers because there are two layers. The administration requires a special return to be filed within the month following the sale with the tax office of your domicile — form 2048-IMM for a building, or 2048-M for shares in a property-rich company. This one-month special return computes the French gain, the abatements, the 19% levy, the social charges and the surtax, and claims the treaty credit for the British tax. Then, the following spring, the gain and the credit must also appear on your annual income tax return: foreign income on the 2047 schedule and the overall return 2042 and its supplement 2042-C, since Article 170 of the General Tax Code provides that “En vue de l’établissement de l’impôt sur le revenu, toute personne imposable audit impôt est tenue de souscrire et de faire parvenir à l’administration une déclaration détaillée de ses revenus et bénéfices, de ses charges de famille et des autres éléments nécessaires au calcul de l’impôt sur le revenu”. If you live in Paris or elsewhere in Île-de-France, this section concerns you directly: file the 2048-IMM with the service des impôts des particuliers of your Paris arrondissement or suburban domicile, not with the non-residents office, and expect the Paris services to cross-check the declared euro gain against the pound prices using Banque de France rates. Practical Paris points include keeping a French-language summary of the English conveyancing documents, because the examining officer works from the French file; requesting a rescrit or at least a written position from your local service before filing where the soulte or the treaty credit is uncertain; and diarising both the British 60-day deadline and the French one-month deadline from completion, since missing either triggers interest, penalties and loss of credibility in any later dispute. The service-public.fr English page on property gains gives a useful overview of the French framework for Anglophone readers, but the impots.gouv.fr foreign-property page quoted above governs your specific case.

When the bill arrives and looks wrong — no credit granted, gain overstated by a conversion error, main-home or partition argument rejected, or a 40% deliberate-failure surcharge added — challenge it methodically. First, demand the documents. Under Article L. 76 B of the Tax Procedure Book, applied in the Lyon case, “L’administration est tenue d’informer le contribuable de la teneur et de l’origine des renseignements et documents obtenus de tiers sur lesquels elle s’est fondée pour établir l’imposition”. In the Lyon case the administration had obtained the taxpayer’s British return and valuation-office data through international assistance and disclosed them after his request, so the procedural challenge failed; but where the administration relies on undisclosed third-party material, including foreign data, the reassessment can fall on this ground alone. Second, attack the computation with evidence: official exchange-rate printouts for both dates, the original purchase deed and completion statement, improvement invoices, the HMRC 60-day return and Self Assessment showing the gain was within a British tax base (which secures the treaty credit even absent effective British payment), and, for partition cases, the divorce order and valuation proving the nature of the buyout. Third, contest penalties: the Lyon first-instance court had already discharged the 40% surcharge for deliberate failure while maintaining the tax, showing that penalties are negotiable even when the principle of taxation stands. Fourth, use the full ladder of remedies within their deadlines: réclamation gracieuse and hierarchical appeal to the local tax office, then claim before the administrative court of your domicile — for Paris residents, the Tribunal administratif de Paris — within two months of the rejection, with the treaty, the Conseil d’État avis and the Lyon judgment as your authorities. Throughout, keep the British and French positions consistent: a gain hidden from HMRC to save British tax weakens the treaty-credit claim in France, while a gain duly declared in London but ignored in Paris is precisely the double taxation the treaty’s credit mechanism exists to eliminate. The Lyon seller’s case ended with the blunt line: “La requête de M. A… est rejetée.” Yours need not, if the gain is computed in euros at the right rates, the British tax is documented, the credit is claimed on the correct forms within the month and at the following spring, and every challenge targets a proven document rather than a general complaint about paying twice.

Conclusion

Selling your UK house from France after Brexit does not give either country exclusive taxing rights: the United Kingdom taxes the gain because the property is there, under Article 14 of the 2008 treaty, and France taxes it because you live there, under its worldwide principle, with the British 60-day return and the French one-month 2048-IMM running in parallel from completion. The French gain is the euro difference between sale and purchase prices, each converted at its own date’s rate, adjusted for partitions and the soulte, reduced by holding-period relief, charged at 19% plus 17.2% social charges plus any high-gains surtax, and then relieved by a treaty credit equal to the French tax on that gain — a credit that covers social charges and proportional levies and requires inclusion in a British tax base rather than effective British payment. File both returns on time, keep the conveyancing and currency evidence, do not claim a main-home exemption for a let or former UK house, and challenge errors with the administration’s own documents. Handled this way, the sale closes two files at once instead of opening a reassessment years later.