All the exemptions under the French impatriate regime

Overview: six distinct benefits

On the employer side, there is in addition an exemption from payroll tax (taxe sur les salaires) up to the exempt bonus or the 30% fraction (CGI, art. 231 bis Q) — detailed on the employer & HR page.

1. The impatriation bonus

A supplement to remuneration directly linked to the exercise of the activity in France, exempt for its actual amount (set in the contract drawn up before the start of duties) or, by election, valued at a flat 30% of total net remuneration. The exemption is bounded by the reference remuneration for comparable functions. Full analysis on the dedicated page: impatriation bonus.

2. The portion of remuneration for workdays abroad

The portion of remuneration relating to the activity performed abroad is exempt where the stays are made in the direct and exclusive interest of the host company (CGI, art. 155 B, I-2; BOI-RSA-GEO-40-10-20, § 220). This covers in particular regular travel to the home country or elsewhere, including stays of less than twenty-four hours (§ 230) — a more flexible rule than the one for employees seconded abroad under article 81 A.

In the absence of a contractual stipulation, the exempt fraction may be determined pro rata to the days of activity abroad over the total number of days of actual activity in the year, travel time being excluded from the count (§ 240). The base for the pro rata is the net taxable annual remuneration, after deducting the exempt impatriation bonus. The tax office may challenge the exemption in the event of a clear disproportion. Supporting documents to keep: assignment orders, boarding passes, hotel bills and expense reports (§ 250).

3. The dual cap: 50% overall or 20% on the foreign portion

The combined bonus + foreign portion is capped, at the taxpayer's annual choice (CGI, art. 155 B, I-3; BOI-RSA-GEO-40-10-20, § 280 to 330):

• Option 1 — overall cap: the total exemption (bonus + foreign portion) cannot exceed 50% of total net remuneration;
• Option 2 — cap on the foreign portion only: the bonus is exempt without an overall cap (within the limit of the reference remuneration), but the exempt foreign portion cannot exceed 20% of taxable remuneration net of the bonus.

Official example no. 1 (BOFiP, § 340) — high bonus: option 2 wins

Net remuneration of €220,000, including an impatriation bonus of €130,000 and a foreign portion of €30,000; reference remuneration €100,000. The exemptible bonus is limited to €120,000 (€10,000 added back to reach the reference). Option 1: exemption capped at €110,000 (50% × 220,000). Option 2: exempt bonus €120,000 + foreign portion capped at €20,000 (20% × 100,000) = €140,000 exempt.

Official example no. 2 (BOFiP, § 350) — 30% flat rate and substantial foreign activity: option 1 wins

Net remuneration of €140,000 with no contractual bonus, foreign portion €50,000, reference €100,000. 30% flat rate = €42,000, reduced to €40,000 by the reference. Option 1: exemption capped at €70,000 (50% × 140,000) — reached with 40,000 + 50,000 = €90,000 exemptible. Option 2: €40,000 + €20,000 (20% × 100,000) = €60,000. Option 1 wins.

The choice is made afresh each year based on the actual composition of remuneration — an annual calibration to build into the preparation of the tax return.

4. Foreign-source passive income: 50% exemption

Throughout the duration of the regime, the following are exempt from income tax up to 50% (CGI, art. 155 B, II; BOI-RSA-GEO-40-10-30):

• investment income (dividends, interest, proceeds of capitalization contracts and life insurance) whose payment is made by a person established outside France in a State or territory that has concluded with France a treaty containing an administrative assistance clause to combat tax fraud and evasion, or an exchange-of-information agreement;
• intellectual or industrial property income (authors' royalties of writers and composers, patent income received by inventors — art. 92, 2-2° and 3° of the CGI), subject to the same payer-location condition;
• capital gains on disposals of securities and corporate rights where the custodian of the securities (or, failing that, the issuing company) is established in such a State. Correspondingly, capital losses are taken into account only up to 50%.

The test is the location of the paying establishment or the custodian — not that of the distributing company: dividends from a French company held in a securities account kept abroad may qualify, while foreign securities deposited with a bank in France do not (BOI-RSA-GEO-40-10-30-30, § 20). The exemption applies to income received abroad, even if the amounts are subsequently repatriated to a French account (BOI-RSA-GEO-40-10-30-10, § 100). The list of covered States appears in BOI-ANNX-000508 — the United Arab Emirates are on it, with an exchange-of-information clause applicable to income tax.

Limits of the « 50% » component

• The income-tax exemption under Article 155 B does not halve the social-levy base for the relevant investment income. The rate depends on the product and period: 18.6% for the affected 2026 categories, while 17.2% continues to apply to certain life-insurance and capitalisation products. Check the contract category and DGFiP exceptions; the impatriate regime does not impose one uniform social-levy rate on all investment income.
• Reference tax income: the exempt amounts are fully taken into account in it (CGI, art. 1417, IV);
• Exclusions: deemed distributed income (art. 111, 111 bis, 123 bis of the CGI), royalty holders other than the author and their heirs, stock-option exercise gains (only the sale gain is eligible), and occasional disposals of crypto-assets (Rép. min. Renaud-Garabedian, Senate, 4 December 2025, no. 2483);
• Household members: the exemption benefits only the person who holds the regime; on a joint account, it applies up to their share (half between spouses).

5. Foreign pension and protection insurance contributions

An impatriate may deduct from taxable remuneration the contributions paid to the statutory social security schemes of their home State (art. 83, 1°-0 bis of the CGI) and, within certain limits, contributions to the supplementary pension and supplementary protection schemes to which they were affiliated before taking up duties in France (art. 83, 2°-0 ter; BOI-RSA-GEO-40-20). For an executive returning from the Emirates, this item typically concerns international pension plans subscribed during the expatriation — their deductibility must be checked plan by plan.

On the social security side, article L. 767-2 of the French Social Security Code also allows, under conditions, a temporary exemption from affiliation to the compulsory French old-age insurance schemes for impatriate employees (information: Urssaf).

6. IFI: five years limited to French property

Any individual who settles in France without having been tax-domiciled there during the five preceding calendar years is liable to the IFI only on their real property and property rights located in France (and company shares up to the fraction representing French real estate), until 31 December of the fifth year following that of the move (CGI, art. 964, 1°, para. 2; BOI-PAT-IFI-10-20-20). The taxation threshold remains set at €1.3M of taxable real estate wealth.

This component is independent of the employment regime: no employment condition is required, so it also benefits non-working spouses. Real estate kept in Dubai or elsewhere abroad thus remains outside the scope of the IFI for five years.

What the regime does not exempt

• The income-tax exemption under Article 155 B does not halve the social-levy base for the relevant investment income. The rate depends on the product and period: 18.6% for the affected 2026 categories, while 17.2% continues to apply to certain life-insurance and capitalisation products. Check the contract category and DGFiP exceptions; the impatriate regime does not impose one uniform social-levy rate on all investment income.
• the base salary and package components not linked to the impatriation;
• rental income, French or foreign (subject to tax treaties);
• passive income whose payer or custodian is established in France or in a non-covered State;
• the CDHR where applicable — with a favorable clarification in the 2026 Finance Act: the reference tax income used to determine liability to this contribution is reduced by the income exempt under article 155 B.