France: Finance Bill for 2018 adopted by the parliament


The Finance Bill for 2018 was adopted by the French Parliament on 21 December 2017 and will be published shortly in the Official Journal. (“the Law”).


1 January 2018 

the withholding tax rate applicable to French dividend payments distributed to non-resident individuals will be decreased to 12.8%.

Another measure of the Law is to progressively decrease the withholding tax rate applicable to non-resident legal entities to 25% by 2022.


The current withholding tax rate applicable to uncertified non-resident individual and legal entity investors is 30%. No particular reduced rate is granted to individuals compared to legal entities, unless specified in the double taxation treaty (DTT) signed between the country of residence of the beneficiary and France.

Under article 28 of the Law, the statutory withholding tax rate applicable to foreign individuals receiving dividend payments as of 1 January 2018 is set at 12.8%. This rate may still be reduced under a DTT with France.

Under Article 84 of the Law, the statutory withholding tax rate applicable to foreign legal entities on dividend payments will be aligned to the French Corporate tax rate as of 1 January 2020. The French Corporate tax rate is currently 33% and will be progressively reduced to 28% on 1 January 2020, 26.5% on 1 January 2021 and 25% on 1 January 2022. Until 1 January 2020, the applicable tax rate remains 30%.

Impact on customers

Non-resident individuals

The French Tax Authorities (FTA) have not yet published their guidelines and the documentation that will be required to prove the eligibility of the beneficial owners to this new reduced rate of 12.8% is still unknown.

In the absence of official guidelines, the paying agents will continue to apply the default tax rate of 30% at source or the DTT rates if valid certification is provided.

We continue to monitor the situation and will keep you informed as soon as the FTA publish their guidelines.

Non-resident legal entities

There will be no change to the statutory tax rate until 1 January 2020 when it will be reduced to 28%.

Therefore, from 1 January 2018 to 31 December 2019, the withholding tax rate of 30% will continue to apply to dividend payments and may be reduced under DTT provisions or according to domestic Law if valid certification is provided.

Further information

Please refer to the Clearstream Banking1 Market Taxation Guide - France for further details on the applicable procedure.

Customers may contact the Clearstream Banking Tax Help Desk or Clearstream Banking Client Services or their Relationship Officer.


1. Clearstream Banking refers collectively to Clearstream Banking S.A., registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Trade and Companies Register under number B-9248, and Clearstream Banking AG, registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500.