You created a company in France from London, New York, Dubai or Singapore, and instead of increasing the share capital you wired money from your personal foreign account to keep the business running: paying the office deposit, covering the first salaries, bridging a value-added tax (VAT) gap. On the French balance sheet, that wire is called an avance en compte courant d’associ\u00e9, a shareholder current-account advance, in plain terms a loan from a shareholder to their own company. Months later you ask for your money back and the reply from Paris is evasive: the funds are blocked, the shareholders voted a lock-in, the company has no cash, the manager says the advance will be repaid only when the property is sold. Living abroad, you wonder whether French law leaves you powerless, how much interest your company may legally pay you, and what French tax applies when interest crosses the border to a non-resident lender. This guide answers those three questions in order: first, your right to be repaid and the proof you must gather from abroad; second, the blocking clauses and minority traps that can lawfully delay repayment; third, the deductible-interest cap and the withholding tax on interest paid to someone who does not live in France. Each point is grounded in the statute in force and in court decisions handed down in 2025 and 2026.<\/p>\n
French company law starts from a simple principle: money you lend to your company is not a gift and not capital. It is a loan, and a loan must be repaid. Article 1902 of the French Civil Code states that “L’emprunteur est tenu de rendre les choses pr\u00eat\u00e9es, en m\u00eame quantit\u00e9 et qualit\u00e9, et au terme convenu” (Article 1902, Civil Code<\/a>). In practice, shareholder current-account advances are repayable on demand, at any time, unless a written agreement says otherwise. That default rule is your strongest asset when you live abroad, because it means you do not need a court to create your right: you only need to prove the loan and to demand it.<\/p>\n A recent decision shows exactly how courts apply this. Four shareholders of a French simplified joint-stock company (soci\u00e9t\u00e9 par actions simplifi\u00e9e, known as a SAS) had made current-account advances to finance a real-estate project in Benin. After falling out with the chairwoman (pr\u00e9sidente), they asked to leave the company and to recover their advances. The Paris Commercial Court ordered the company to repay 6,700 euros, 6,700 euros, 7,140 euros and 3,660 euros respectively, and the company appealed. The Paris Court of Appeal recalled, on 14 April 2026 (no. 24\/01215), the ground on which the first judges had granted repayment: “ni dans les statuts, ni lors de la souscription du capital social, il a \u00e9t\u00e9 stipul\u00e9 un blocage des comptes courants”. Because neither the articles of association (statuts) nor the subscription documents contained any lock-in clause, the advances remained repayable. The court added that a shareholders’ meeting held after the formal demand could not retrospectively increase the shareholders’ commitments without unanimity. For a foreign founder, the lesson is direct: if you never signed a blocking agreement (convention de blocage), the company cannot invent one after you ask for your money, and a majority vote cannot force you to leave your cash in the company indefinitely. Read the full decision here: CA Paris, P\u00f4le 5, Chambre 8, 14 April 2026, no. 24\/01215<\/a>.<\/p>\n Proof is where foreign lenders win or lose. From abroad, assemble before any demand: the written current-account agreement (convention de compte courant) if one exists, or at minimum emails and board minutes describing the wire as an advance; the SWIFT transfer slips showing the debit of your foreign personal account and the credit of the French company account, with matching amounts, dates and reference; the company’s accounting entries and annual financial statements (comptes annuels) recording the credit balance in your name; and any acknowledgment by the manager, even informal. If interest was agreed, Article 1907 of the Civil Code requires writing: “Le taux de l’int\u00e9r\u00eat conventionnel doit \u00eatre fix\u00e9 par \u00e9crit” (Article 1907, Civil Code<\/a>). Without a written rate, you can still recover the principal, but contractual interest above the statutory rate (taux d’int\u00e9r\u00eat l\u00e9gal) will be refused. Keep every document in euros with the exchange rate applied at the transfer date, because the French judge reasons in euros and your foreign bank statement alone will not convert itself.<\/p>\n The procedure itself can be handled from abroad through a French lawyer. The standard sequence is a formal demand letter (mise en demeure) served by a commissaire de justice, the French enforcement officer formerly called huissier, giving the company a short deadline, typically eight to fifteen days, and warning of legal interest and court costs. If the debt is undisputed in writing, the fast track is the injonction de payer<\/a>, an order-for-payment procedure before the commercial court (tribunal de commerce<\/a>) or the judicial court (tribunal judiciaire) depending on the company form, filed on documents alone and served internationally. If the company disputes the nature of the payment, an ordinary summons (assignation) follows, and the court will examine the paper trail described above. Interest for late payment and capitalisation of interest can be claimed from the demand, as claimants routinely do, though the court grants them only on proven written agreement or on the statutory rate. Acting through counsel in Paris, signing powers of attorney electronically and appearing by representation means you never need to fly in for the first stages. Readers setting up the whole structure, from the corporate bank account to the Kbis company identity certificate issued by the court clerk (greffe), will find the general roadmap in our companion guide to setting up a company in France as a foreign founder: bank account, Kbis, VAT and first hire<\/a>.<\/p>\n Repayment on demand is the default, not an absolute. Three lawful obstacles can delay or defeat your claim, and each has been tested in court in the past eighteen months.<\/p>\n First, a lock-in clause you actually signed is enforceable. In a Paris case decided on 22 May 2026 (no. 24\/08300), a company had transferred 1,284,800 euros to a sister company within a joint venture holding a Paris property. When it demanded immediate repayment of its current-account claim with interest from July 2020, the Paris Commercial Court rejected the claim, having “rejet\u00e9 la demande de remboursement de l’avance en compte courant, qualifi\u00e9 de pr\u00eat entre associ\u00e9s remboursable uniquement lors de la revente du bien immobilier”. The advance had been characterised as a shareholder loan repayable only upon resale of the building, and the creditor company did not even appeal that part of the judgment: its appeal challenged only accounting disclosure orders. The message for foreign investors is blunt: read before you wire. If the subscription pack, the shareholders’ agreement (pacte d’associ\u00e9s<\/a>) or a standalone blocking agreement ties repayment to an event such as a resale, a fundraising or a fixed date, French courts will hold you to it. Never wire first and read later; the blocking clause signed in English in a London or Dubai side letter can still bind you if it designates the French advance. Full text: CA Paris, P\u00f4le 4, Chambre 1, 22 May 2026, no. 24\/08300<\/a>.<\/p>\n Second, even without a lock-in, the company may simply have no distributable cash because profits are systematically parked in reserves. A minority shareholder in a French company that had never distributed a single dividend since incorporation, with reserves climbing from 138,389 euros to 282,294 euros between 2015 and 2023 while the majority manager raised his own pay, cried abuse of majority (abus de majorit\u00e9). Before the Poitiers Court of Appeal on 11 March 2025 (no. 24\/00333), she invoked the Cour de cassation, Commercial Chamber, 1 July 2003, no. 99-19328, recalled in the judgment, under which “les b\u00e9n\u00e9fices d’exploitation de l’entreprise sont venus syst\u00e9matiquement accro\u00eetre le montant des capitaux propres, (…) sans que cette mise en r\u00e9serve n’ait eu aucun effet sur la politique d’investissement de l’entreprise”. Yet the court confirmed the lower judgment in full: “Confirme le jugement d\u00e9f\u00e9r\u00e9 en toutes ses dispositions”, dismissing her claims. Systematically hoarding profits can in theory amount to abuse of majority, but the bar is high: the claimant must show the reserves serve neither debt, nor risk, nor investment, and benefit only the majority. A foreign minority shareholder who cannot obtain repayment of a current account and cannot obtain dividends either should therefore gather multi-year accounts, investment records and the manager’s remuneration history before alleging abuse, because courts reject bare assertions of unfairness. Decision: CA Poitiers, 2nd Chamber, 11 March 2025, no. 24\/00333<\/a>.<\/p>\n Third, two neighbouring rulings show how courts treat debt forgiveness and withdrawal accounting. The Versailles Court of Appeal, Commercial Chamber 3-2, on 9 September 2025 (no. 24\/05677), upheld the rejection of a claim seeking to annul EUR 80,450 of current-account debt waivers granted since 2017 and to order repayment of 225,550 euros plus statutory interest running from 21 December 2019, in a family property company (soci\u00e9t\u00e9 civile immobili\u00e8re, known as SCI) that had bought its building with shareholder advances and a bank loan. And the Aix-en-Provence Court of Appeal, Chamber 3-4, on 23 October 2025 (no. 23\/06454), refused a withdrawing shareholder’s demand for EUR 352,855.80 of current-account repayment, sending the valuation of her rights to an expert instead. Together they confirm that waivers (abandons de cr\u00e9ance) documented in the accounts are hard to undo, and that leaving the company does not automatically cash out the current account on the leaver’s terms. Texts: CA Versailles, Commercial Chamber 3-2, 9 September 2025, no. 24\/05677<\/a> and CA Aix-en-Provence, Chamber 3-4, 23 October 2025, no. 23\/06454<\/a>.<\/p>\n One more boundary protects you but also constrains managers. The loan direction matters: while a shareholder may lend to the company, the reverse is strictly policed. Article L223-21 of the French Commercial Code provides that “A peine de nullit\u00e9 du contrat, il est interdit aux g\u00e9rants ou associ\u00e9s autres que les personnes morales de contracter, sous quelque forme que ce soit, des emprunts aupr\u00e8s de la soci\u00e9t\u00e9, de se faire consentir par elle un d\u00e9couvert, en compte courant ou autrement, ainsi que de faire cautionner ou avaliser par elle leurs engagements envers les tiers.” An identical prohibition applies to directors of public limited companies under Article L225-43, which states that “A peine de nullit\u00e9 du contrat, il est interdit aux administrateurs autres que les personnes morales de contracter, sous quelque forme que ce soit, des emprunts aupr\u00e8s de la soci\u00e9t\u00e9, de se faire consentir par elle un d\u00e9couvert, en compte courant ou autrement, ainsi que de faire cautionner ou avaliser par elle leurs engagements envers les tiers.” A debit current account in the manager’s name is therefore void and must be regularised immediately; it cannot be used as a set-off excuse against your credit balance. Statutes: Article L223-21, Commercial Code<\/a> and Article L225-43, Commercial Code<\/a>. In a SAS, advances from shareholders holding more than 10 percent of voting rights fall under regulated agreements (conventions r\u00e9glement\u00e9es): the auditor (commissaire aux comptes), or the chair if there is no auditor, reports on them and the shareholders vote, under Article L227-10, Commercial Code<\/a>, which requires that “Le commissaire aux comptes ou, s’il n’en a pas \u00e9t\u00e9 d\u00e9sign\u00e9, le pr\u00e9sident de la soci\u00e9t\u00e9 pr\u00e9sente aux associ\u00e9s un rapport sur les conventions intervenues directement ou par personne interpos\u00e9e entre la soci\u00e9t\u00e9 et son pr\u00e9sident, l’un de ses dirigeants, l’un de ses actionnaires disposant d’une fraction des droits de vote sup\u00e9rieure \u00e0 10 %”. Check that your advance went through that report: its absence does not void your loan, but its presence proves the company acknowledged the debt.<\/p>\n French tax law lets the company deduct interest paid to shareholders, but within a ceiling that moves every month. Article 39, 1-3\u00b0 of the French Tax Code (Code g\u00e9n\u00e9ral des imp\u00f4ts) allows “Les int\u00e9r\u00eats servis aux associ\u00e9s \u00e0 raison des sommes qu’ils laissent ou mettent \u00e0 la disposition de la soci\u00e9t\u00e9, en sus de leur part du capital, quelle que soit la forme de la soci\u00e9t\u00e9, dans la limite de ceux calcul\u00e9s \u00e0 un taux \u00e9gal \u00e0 la moyenne annuelle des taux effectifs moyens pratiqu\u00e9s par les \u00e9tablissements de cr\u00e9dit et les soci\u00e9t\u00e9s de financement pour des pr\u00eats \u00e0 taux variable aux entreprises, d’une dur\u00e9e initiale sup\u00e9rieure \u00e0 deux ans. Cette d\u00e9duction est subordonn\u00e9e \u00e0 la condition que le capital ait \u00e9t\u00e9 enti\u00e8rement lib\u00e9r\u00e9.” Two practical consequences follow. First, only interest computed up to that average market rate, called the TMP average rate, is deductible; anything above is added back to taxable profit. Second, no deduction at all is allowed unless the share capital has been fully paid up (capital enti\u00e8rement lib\u00e9r\u00e9): a foreign founder who subscribed 10,000 euros but paid in only 2,500 euros cannot have the company deduct a single euro of interest on the current account. Text: Article 39, 1-3\u00b0, General Tax Code<\/a>.<\/p>\n The administration publishes the ceiling as a reference rate (taux de r\u00e9f\u00e9rence) depending on the financial year-end. The official English-language service-public explainer, verified 3 July 2026, explains that these advances are treated as interest-bearing loans, and warns that where the contractual rate fixed by the articles or the agreement exceeds the reference rate, the excess interest paid to the shareholder cannot be deducted. For twelve-month years closing in mid-2026 the published reference rates were 4.34 percent for years closing between 31 May and 29 June 2026 and 4.33 percent for years closing between 30 June and 29 September 2026, down from 5.32 percent a year earlier. Concretely, a 200,000 euro advance bearing 7 percent contractual interest for a year ending 30 June 2026 generates 14,000 euros of interest, of which only about 8,660 euros (200,000 at 4.33 percent) is deductible; the 5,340 euro excess stays in taxable profit and costs the company corporate income tax (imp\u00f4t sur les soci\u00e9t\u00e9s) at the standard rate. The detailed doctrine is BOFiP BOI-BIC-CHG-50-50-30 on interest on shareholder advances and the cap rate. Sources: service-public: shareholder current account, operation and taxation (English)<\/a> and BOFiP BOI-BIC-CHG-50-50-30, interest cap rate<\/a>.<\/p>\n When the foreign lender is not an individual but their own foreign company, a second ceiling applies. Article 212, I of the Tax Code provides that “Les int\u00e9r\u00eats aff\u00e9rents aux sommes laiss\u00e9es ou mises \u00e0 disposition d’une entreprise par une entreprise qui est son associ\u00e9e ou par une entreprise li\u00e9e, directement ou indirectement, au sens du 12 de l’article 39, sont d\u00e9ductibles : a) Dans la limite de ceux calcul\u00e9s d’apr\u00e8s le taux pr\u00e9vu au premier alin\u00e9a du 3\u00b0 du 1 du m\u00eame article 39 ou, s’ils sont sup\u00e9rieurs, d’apr\u00e8s le taux que cette entreprise emprunteuse aurait pu obtenir d’\u00e9tablissements ou d’organismes financiers ind\u00e9pendants dans des conditions analogues”. A French subsidiary borrowing from its foreign parent at 9 percent must therefore justify that an independent bank would have lent at that rate in similar conditions, with documentation on the loan terms, the subsidiary’s creditworthiness and market comparables, or accept the TMP cap. Groups that ignore this face reassessment on audit, with the excess interest reclassified. Statute: Article 212, I, General Tax Code<\/a>.<\/p>\n Excess interest does not simply vanish: it can be recharacterised as a distribution. Article 109, 1 of the Tax Code treats as distributed income “Tous les b\u00e9n\u00e9fices ou produits qui ne sont pas mis en r\u00e9serve ou incorpor\u00e9s au capital” and “Toutes les sommes ou valeurs mises \u00e0 la disposition des associ\u00e9s, actionnaires ou porteurs de parts et non pr\u00e9lev\u00e9es sur les b\u00e9n\u00e9fices.” Interest paid above market to a foreign shareholder therefore risks dividend treatment, with dividend withholding instead of interest treatment and no corporate deduction. The written agreement should state a rate at or below the reference rate, fix the calculation method, and record the capital liberation date. And remember Article 1907: “Le taux de l’int\u00e9r\u00eat conventionnel doit \u00eatre fix\u00e9 par \u00e9crit” (Article 1907, Civil Code<\/a>). An oral 6 percent agreed on a video call is worth little before the tax auditor (v\u00e9rificateur); a signed clause is worth its weight. Statutes: Article 109, 1, General Tax Code<\/a> and Article 1907, Civil Code<\/a>.<\/p>\n The tax treatment of the interest depends on where you, the lender, live for tax purposes (domicile fiscal). If you moved to France, Article 125 A, I of the Tax Code provides that “Les personnes physiques fiscalement domicili\u00e9es en France au sens de l’article 4 B qui b\u00e9n\u00e9ficient d’int\u00e9r\u00eats, arr\u00e9rages et produits de toute nature de fonds d’Etat, obligations, titres participatifs, bons et autres titres de cr\u00e9ances, d\u00e9p\u00f4ts, cautionnements et comptes courants, ainsi que d’int\u00e9r\u00eats vers\u00e9s au titre des sommes mises \u00e0 la disposition de la soci\u00e9t\u00e9 dont elles sont associ\u00e9es ou actionnaires et port\u00e9es sur un compte bloqu\u00e9 individuel, sont assujetties \u00e0 un pr\u00e9l\u00e8vement lorsque la personne qui assure le paiement de ces revenus est \u00e9tablie en France, qu’il s’agisse ou non du d\u00e9biteur, ce dernier \u00e9tant \u00e9tabli en France ou hors de France.” The French company then withholds a flat levy (pr\u00e9l\u00e8vement) at payment, creditable against your French income tax. Statute: Article 125 A, I, General Tax Code<\/a>.<\/p>\n If you stayed tax-resident abroad, which is this guide’s core case, the mechanism is a withholding at source (retenue \u00e0 la source). Article 119 bis, 1 of the Tax Code states that “Les revenus de capitaux mobiliers entrant dans les pr\u00e9visions des articles 118,119, 238 septies B et 1678 bis donnent lieu \u00e0 l’application d’une retenue \u00e0 la source dont le taux est fix\u00e9 par le 1 de l’article 187 , lorsqu’ils b\u00e9n\u00e9ficient \u00e0 des personnes qui ont leur si\u00e8ge en France ou \u00e0 l’\u00e9tranger ou qui n’ont pas leur domicile fiscal en France.” Paragraph 2 extends the same logic to distributed products under Articles 108 to 117 bis when the beneficial owners (b\u00e9n\u00e9ficiaires effectifs) have neither French tax domicile nor French seat. The French company must therefore identify your residence, apply the domestic rate by default, and pay the withholding to the tax administration (direction g\u00e9n\u00e9rale des finances publiques, known as DGFiP). Statute: Article 119 bis, General Tax Code<\/a>. Where a bilateral tax treaty between France and your state of residence caps the source taxation of interest, often at 0 or 10 percent, the reduced rate applies only if you deliver before payment a certificate of residence (attestation de r\u00e9sidence fiscale) on the treaty form, duly stamped by your home tax authority. Without that certificate, the company must withhold at the full domestic rate, and you recover the excess afterwards by filing a reclaim with the French withholding-tax office with proof of residence, the loan agreement, the interest computation and the bank trail. Keep the certificate current: an expired form is the most common reason treaty relief is refused on audit.<\/p>\nB. When the French company refuses: lock-in clauses, systematic reserves and prohibited debit accounts<\/h3>\n
II. Interest and French tax when the lender lives outside France<\/h2>\n
A. How much interest the French company may deduct: the cap, the reference rate and the paid-up capital condition<\/h3>\n
B. French tax when interest leaves France: withholding, treaties and how to challenge from abroad<\/h3>\n