France: Relaxation of the Exit Tax
New measures were introduced by the Finance Act for 2019 (the Act) regarding the so-called Exit Tax, which applies to unrealized capital gains on the taxpayer’s transfer of tax domicile outside France. The old regime was long considered too harsh, and relaxation of certain provisions was much needed. Here are some important aspects of the new measures:
- The participation threshold was increased to 50 percent;
- Reporting requirements are less stringent;
- Fortunes worth less than 2.7 million euros will benefit from exemption after two years only, while those above the threshold will have to wait five years.
France's Exit Tax is now similar to comparable taxes in Portugal, Germany and the Netherlands.