For British residents moving to France, the risk of paying income tax twice on the same earnings — once to HMRC and once to the French tax authorities — is a real and legitimate concern. The good news is that the United Kingdom and the French Republic have a Double Taxation Convention (DTA), signed in 2008 and currently in force, that exists specifically to prevent double taxation and provide tax relief to residents of both contracting parties.
How to avoid double taxation between the UK and France
Under this treaty, each item of income — whether employment income, pension, dividend, capital gains, rental income from real estate or immovable property, or inheritance — is allocated to one country's tax jurisdiction. As a French tax resident, you remain liable to declare your worldwide income in France, but the convention's provisions determine where that income is actually taxed and how tax relief or a foreign tax credit is applied to avoid double taxation.
Understanding the key provisions of this convention is essential for any British expat living in France. Whether you are claiming a tax credit on UK pension income, dealing with capital gains tax on UK property, navigating inheritance tax and French succession tax, or simply trying to understand your tax liability across both contracting states, this guide covers the current treaty rules, the tax rates that apply, and the practical steps you need to take to ensure compliance with both UK and French tax law.
What is the UK-France Double Taxation Agreement (DTA) ?
The UK-France Double Taxation (DTA), signed in 2008, is a legally binding treaty that determines which country has the right to tax each type of income. It covers employment income, pensions, dividends, interest, rental income, capital gains, and more. The treaty does not eliminate tax — it allocates taxing rights and provides mechanisms to offset tax already paid in one country against the liability in the other.
The golden rule: where do you pay tax?
Your tax residency status is the starting point. As a French tax resident, France generally has the primary right to tax your worldwide income. However, the treaty overrides this for certain income types — meaning some income remains taxable in the UK even after you move to France.
Here is how the main income types are treated:
Employment income is taxed in the country where you work. If you work remotely for a UK employer from France, France taxes your salary. If you commute to the UK to work, the situation becomes more complex and specialist advice is strongly recommended.
Private pensions are generally taxable in France for French tax residents. Once you establish French tax residency, you should apply for an NT (no tax) code from HMRC to stop UK tax being deducted at source — otherwise you risk paying UK tax that you then have to reclaim.
UK government service pensions — including NHS, civil service, military, police, and teachers' pensions — are taxed in the UK under the treaty, not in France. However, they must still be declared in France, where they are used to calculate your effective tax rate on other income.
UK state pension is taxable in France for French tax residents, not in the UK. You must declare it on your French tax return each year.
Rental income from UK property is taxed in the UK. France will also take it into account when calculating your overall French tax rate, but a tax credit prevents double taxation.
Dividends and interest from UK sources are generally taxable in France for residents, with the treaty capping any UK withholding tax.
Capital gains on UK property are taxable in the UK under non-resident capital gains tax (NRCGT) rules. France may also tax the gain but will provide a credit for UK tax already paid.
How the foreign tax credit works
When the treaty allocates taxing rights to the UK but you are a French resident, France typically grants a tax credit equal to the French tax that would have been due on that income. This prevents you from paying French tax on top of UK tax. The credit is not always a full offset — the mechanics depend on the income type and the specific treaty article, so getting this right on your French tax return requires care.
The NT tax code: a common mistake to avoid
Many British expats in France continue to have UK income tax deducted at source on their private pensions — simply because they have not applied for an NT (no tax) code from HMRC. This means they pay UK tax they are no longer liable for and then face a lengthy reclaim process. Applying for the NT code as soon as you establish French tax residency is one of the most important practical steps to take.
ISAs: a trap for British expats
UK ISAs lose their tax-free status the moment you become a French tax resident. France does not recognise the ISA wrapper — the interest, dividends, and capital gains inside an ISA are taxable in France as normal investment income, subject to the 30% flat tax (PFU) or the progressive scale. This catches many British expats off guard and is worth reviewing with a financial adviser before you move.
Reporting obligations in both countries
Even when income is taxed in the UK and exempt from French tax under the treaty, you must still declare it on your French tax return. France uses this information to calculate your effective tax rate (taux effectif) on other income — a mechanism that can push up your overall French tax bill even on income that is not directly taxable in France. Failing to declare foreign income in France, even exempt income, can trigger penalties.
When to seek professional advice
The UK-France double taxation treaty is detailed and the interactions between the two tax systems are complex — particularly for those with multiple income sources, UK property, defined benefit pensions, or significant investment portfolios. A specialist cross-border financial adviser familiar with both UK and French tax law can ensure you are structured correctly from day one, apply for the right tax codes, and avoid the most common and costly mistakes.
This article is for informational purposes only and does not constitute tax or financial advice. Tax rules change and your situation will depend on your specific income sources and residency status. Always consult a qualified independent adviser familiar with both UK and French tax law. We can recommend one if needed.
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