France imposes a tax on large monetary gifts, and if you’re transferring money to someone who resides there they’ll be responsible for filing. The US also imposes a gift tax on the sender, but you won’t have to pay unless you’ve gifted more than $12.06 million in your lifetime.
How France regulates large remittances
Gift taxes are just one part of France’s complicated inheritance laws, which are generally based on your relationship to the beneficiary of your gifts of cash or property.
It’s possible for your French family to receive one-off gifts of cash tax-free. These amounts range from €159,325 for gifts to a family member with a disability to €5,310 for a gift to a great-grandchild. Each child has a tax-free allowance of €100,00 on inheritance from their parents and siblings have a tax-free limit of €15,932.
Given the complexity of these laws that are deeply entrenched in legal requirements and exclusions, your loved ones will benefit from an expert in French laws when receiving large amounts of cash. To find out exactly how much you’ll need to pay in taxes, check the French tax code.
What if the money isn’t a gift?
If you’re sending money for a purchase, the recipient will need to pay value-added tax (VAT) to the French government.
If the money is for a loan, things get much more complicated, and whether your recipient needs to pay taxes depends on factors such as the interest rate, purpose of the loan and your relationship to the borrower. It would be a good idea to consult an expert in French tax laws if you’re loaning someone a large sum of money from overseas.
What are the penalties for not filing a large remittance?
Just as US citizens are required to submit annual tax returns, French citizens are required to submit a déclaration des revenues each year. If your recipient fails to declare a large remittance on their tax returns, they could be on the hook for stiff financial penalties equal to 5% or more of the remittance amount. If the government determines that they’ve willfully ignored the law, tax penalties can soar to a severe 50% or more.
French banks are required to record the source of large transfers and report any suspicious deposits to the government. Encourage your family and friends in France to declare any large remittance on their general tax returns.
Do I have to report large transfers out of the US?
Possibly. If you’re sending a gift of more than $15,000, conducting a business transaction of more than $10,000 or transferring the money to a French account in your name, you’ll likely need to file with the IRS.
The US government monitors transactions into and out of the country. With more focused attention on money transfers since 9/11, if you fail to report a remittance of $10,000 or more, it will likely be discovered.
There’s no legal limit to how much you can send to France. However, some transfer providers will impose their own limits. If you’re planning a large transfer, use a provider with no cap, such as Xe.
How can my recipient in France get the money?
Depending on which provider you choose, your recipient can have the money deposited directly into their bank account or mobile wallet or they can pick up the cash in person.
If picking up the money in person, your recipient may need to submit a government-issued ID or a transaction confirmation number. Confirm with your bank or independent money transfer provider the exact information your friends and family might need to receive your funds before sending.
If you’re transferring over $10,000 to France, you’ll likely have to let the IRS know, even if you don’t owe any taxes. And your recipient may have to pay a tax in France, though the exact amount will depend on how much you’re sending and how you’re related to them.
As with all international money transfers, be wary of potential fraud and only send money to people you know. Using a reputable provider can safeguard you from potential scams.
Frequently asked questions
With the US trading some $5 million with countries worldwide, there’s likely a way for you to carve a slice from that pie.
To start, we’ve put together guides to starting an import/export business in electronics, machinery and other industries. Learn about what to expect for startup costs, registering your business and more.
No. If you follow the law and submit your legal documentation timely and accurately, you shouldn’t experience hassles with the IRS. If you choose not to follow the law, you may be on the hook for stiff penalties, including jail time.
Penalties can be avoided if you can show the IRS reasonable cause for a failure to file, such as a natural disaster, serious illness or house fire.
Picture: Shutterstock
Whether products shown are available to you is subject to individual provider sole approval and discretion in accordance with the eligibility criteria and T&Cs on the provider website.
Leah Fallon is a freelance journalist and editor, specializing in personal finance and small business. She owns Birch Tree Bookstore in Leesburg, Virginia.
I was told by one money transfer rep that there is limit of 10k euros that I can send to a recipient in France. Another rep told me that the limit of 10k is to the recipient. Which one is it? I am the limit or the recipient is the limit? I was told it’s 10 k in 6 months… Thank you in advance.
Generally speaking, the transfer limit applies on the sender. If the sender can send 10K Euros, then it follows that the recipient won’t be able to receive 10K Euros as well.
Every money transfer service provider has their own terms and conditions. So, it would be a good idea if you directly get in touch with them to get a more personalised answer.
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
How likely would you be to recommend finder to a friend or colleague?
0
1
2
3
4
5
6
7
8
9
10
Very UnlikelyExtremely Likely
Required
Thank you for your feedback.
Our goal is to create the best possible product, and your thoughts, ideas and suggestions play a major role in helping us identify opportunities to improve.
Advertiser Disclosure
finder.com is an independent comparison platform and information service that aims to provide you with the tools you need to make better decisions. While we are independent, the offers that appear on this site are from companies from which finder.com receives compensation. We may receive compensation from our partners for placement of their products or services. We may also receive compensation if you click on certain links posted on our site. While compensation arrangements may affect the order, position or placement of product information, it doesn't influence our assessment of those products. Please don't interpret the order in which products appear on our Site as any endorsement or recommendation from us. finder.com compares a wide range of products, providers and services but we don't provide information on all available products, providers or services. Please appreciate that there may be other options available to you than the products, providers or services covered by our service.
We update our data regularly, but information can change between updates. Confirm details with the provider you're interested in before making a decision.
I was told by one money transfer rep that there is limit of 10k euros that I can send to a recipient in France. Another rep told me that the limit of 10k is to the recipient. Which one is it? I am the limit or the recipient is the limit? I was told it’s 10 k in 6 months… Thank you in advance.
Hi Reema,
Thanks for getting in touch with finder.
Generally speaking, the transfer limit applies on the sender. If the sender can send 10K Euros, then it follows that the recipient won’t be able to receive 10K Euros as well.
Every money transfer service provider has their own terms and conditions. So, it would be a good idea if you directly get in touch with them to get a more personalised answer.
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua