France–Australia — Tax Treaty

1One convention, signed in 2006 — and the clean slate on the other side

One instrument does the treaty work of this relationship. The convention of 20 June 2006, signed at Paris in replacement of the 1976 Canberra text, entered into force on 1 June 2009 and applies from 2010; its French and English texts are equally authentic, and our agency holds both official publications. The multilateral instrument (the anti-abuse rule agreed internationally in 2017) took effect for France and for Australia on the same day, 1 January 2019: a rewritten preamble, the principal-purpose test under which a treaty advantage may be refused where obtaining it was a principal object of an arrangement, the property-rich gains clause rewritten into its 365-day form, and arbitration. Article 2 covers income taxes only — on the French side the income tax, the corporation tax and, by name, the CSG and the CRDS; on the Australian side the income tax and the petroleum resource rent tax. No fortune article exists anywhere in the text, and the administration's treaty list of 29 April 2026 records no succession or gift instrument with Australia. What makes this pair singular is the other side of that absence: Australia abolished death duties by 1982, levies no gift duty and no wealth tax (orientation) — so where most pairs of this collection ask how two systems interact, this one asks a shorter question: what does France charge, since no one else charges anything.

Who counts as a resident — and the cascade with a step missing

Where both states claim a person, article 4 §3 assigns them down a SHORTENED cascade: permanent home, centre of vital interests, then nationality — with no habitual-abode step and no mutual-agreement step for individuals, a drafting particularity worth knowing before relying on the middle steps other treaties carry. A person taxed in a state only on income sourced there is not a resident of it at all (article 4 §2). French domestic law asks its own prior question through CGI article 4 B, on the family's foyer, the principal place of stay and the centres of professional and economic interest. The Australian side is stated at orientation level throughout: no death, gift or wealth taxation; capital-gains tax deferred at death (heirs inherit the cost base); worldwide assessment of residents with a foreign-income tax offset; and the charge on leaving, which taxes a departing resident as if they had sold up, met in § 4 through the convention's own election. The verified ground of this brief is the French side and the 2006 texts; the Australian reading belongs with the family's advisers in Sydney or Melbourne.

The convention's only courtroom appearances

No reported decision of the Conseil d'État concerns a property, treaty residence or an estate on this relationship — in either convention's lifetime. The 2006 text appears at the supreme level only in the cross-convention credit sweeps: the ruling that treaty credits die with a deficit year and carry nowhere (CE, 8 March 2023, n° 456349, fifteen conventions swept) and the net-base ceiling line (CE, 5 July 2021, n° 414463, eighteen conventions). Near-zero litigation is itself the observation: who taxes what, as this brief sets it out, has never needed a courtroom.

Sources considered: 2006 convention (CML consolidation) arts. 2, 4, 30; BOI-ANNX-000306 (29 April 2026); BOI-INT-CVB-AUS-20120912; CE n° 456349, n° 414463 — decision texts read. Scope note: Australian domestic law is orientation only, never load-bearing.

Reviewed as at 11 August 2026 · 2006 convention (CML consolidation) arts. 2, 4; BOI-ANNX-000306 (29 April 2026); CE n° 456349, n° 414463 — decision texts read

2What you pay to buy a property in France, and what it costs you every year

The purchase runs on the sequence French practice fixes: an offer; the pre-sales contract (compromis de vente), with its ten-day cooling-off period and a deposit of customarily 10%; conditions precedent; then the authentic deed before the notaire — the public officer who draws up and registers the deed. A family managing the file from Australia, eight to ten hours ahead of the coast, will usually add advisers of its own and grant a power of attorney for the deed. On the collection's common yardstick — the €4.9M median villa of Cannes and its hills in the DVF register — the buyer pays transfer duties and land-registration taxes of about 5.81% (€284,526), notaire's émoluments and disbursements of roughly €61,250 on the regulated sliding scale, together an indicative 7% all-in (≈ €345,776) on an existing property. A new-build VAT regime, furniture carve-outs or mortgage security will alter the arithmetic; the notaire itemises the actual deed.

The wealth tax arrives alone

Above €1,300,000 of taxable French real-estate assets, CGI article 964 institutes the annual wealth tax; for a person not domiciled in France the base takes in property located in France and the fraction of any company's shares that stands for such property (article 965, 2°). The 2006 convention covers income alone, so no article limits the charge, softens it or promises a credit — and the IFI's own domestic credit mechanism (CGI article 980) imputes only foreign wealth taxes on non-French assets, of which Australia levies none. The five-year arrival window of article 964, 1° is DOMESTIC only on this pair: no treaty wealth article exists to guarantee it. The charge is therefore not doubled and not moderated — simply the only wealth tax the family pays anywhere on the property. The value declared each year is the owner's own detailed estimate of real market value (CGI article 973 I). The local charges then follow the deed: the annual local property tax (taxe foncière) at communal rates; the possible surcharge (surtaxe) on furnished second homes in designated high-demand areas (zone tendue); and the annual occupancy declaration every owner files. Communal rates move year to year, so this brief re-verifies them at each edition.

Our agency prepares a free valuation for owners at valuation.elenaagueeva.com. An agent contacts you within 48 hours to arrange a visit.

It rests on the same official records a French property valuer (expert immobilier) works from: the government's register of recorded sale prices, the cadastre, and the planning permits granted on the parcel. The agent then visits to appraise the view, the garden, and the quality of the construction and the finishes. The valuation report (avis de valeur) is produced within 48 hours of the visit.

The same figure carries your French filings. Wealth tax, the 3% company tax and gift duty are all declared at the property's market value. The law takes that value from your own detailed estimate (articles 761 and 973 of the tax code), and asks no particular valuer to produce it. A court-appointed expert (expert judiciaire) belongs to litigation, not to a declaration. If the administration challenges your figure, a dated, written valuation resting on comparable sales is what supports it.

The first valuation of a property is free for its owner or seller. A repeat valuation of the same property, or one commissioned by a family office, a bank or another adviser for a client, is a billable engagement — ask us for terms.

Sources considered: 2006 convention art. 2; CGI arts. 964 (incl. 1° al. 2), 965 2°, 973 I, 980; cost scales stated for orientation, itemised when our agency takes the file. Scope note: no Australian wealth charge exists — the IFI is the property's principal recurring cost above the threshold.

Reviewed as at 11 August 2026 · CGI arts. 964–965, 973 I, 980; 2006 convention art. 2

3Five ways to own a French property, and what follows from each

Holding structures appear here, per this collection's doctrine, as questions for analysis rather than recommendations. For an Australian buyer one fact organises the table: whatever the deed creates will be read at death by French law alone, on French terms — Australia taxes nothing at death, so there is no second reading to reconcile, and no relief to negotiate either.

Direct ownership

Simplicity, and France taxes it at every stage. On a sale France taxes as the state where the property stands and Australia credits the French charge (articles 13 §1 and 23 §1); at death French duty attaches to the property and no Australian assessment answers it — Australian capital-gains tax is deferred, the heirs inheriting the cost base (orientation).

An Australian or other foreign company

Confidentiality and consolidation, at three French prices. The annual 3% tax on entities holding French property (CGI articles 990 D and 990 E) asks its disclosure question every year; the property fraction of the shares bears the IFI regardless; and a sale of the shares stays French under the 365-day property-rich clause (article 13 §4). At death, French law counts companies the family holds above one half as if the property were held directly (CGI article 750 ter, 2°).

A French SCI

An SCI (a French property-holding company) offers governance, co-ownership between family members and access to French financing. How Australian law classifies the SCI is a question for counsel; on the French side the property fraction bears the IFI, a sale of the shares stays French under the 365-day clause, and at death article 750 ter counts the property as if the family held it directly.

A trust in the chain

The trust is the Australian default the way it is the American one, and French law meets it with machinery of its own: trustee reporting under CGI article 1649 AB, the settlor's wealth-tax inclusion (article 970), the dedicated levy of article 990 J where declaration fails, and transmission rates that reach 60% where beneficiaries' shares are undetermined (article 792-0 bis). The convention's property articles read trust interests like shares (articles 6 §4 and 13 §4). Examined with counsel on both sides before the pre-sales contract.

Giving your children the ownership now, and keeping the use for life (démembrement)

The structure most often set beside the loan divides ownership itself: the buyer keeps the usufruct — the use of the property and its income for life — and gives the bare ownership to the next generation. The code prices the split by age: on the scale of CGI article 669, bare ownership stands at 60% of full value where the usufructuary is between 61 and 70, and at 70% between 71 and 80. Duty falls on that fraction alone, at today's value, and the reunification at the usufructuary's death is not taxed again where article 751's conditions are kept — a notarised gift, more than three months before death, valued on the article 669 scale. The wealth tax does not move: article 968 keeps the full value in the usufructuary's IFI base. With no gift convention and no Australian gift duty, France alone reads the transmission, as the state where the property stands.

Borrowing against the French property cuts French wealth tax — within the code's three limits

Acquisition debt owed to a bank is deductible from the wealth-tax base (CGI article 974), and financial assets stand outside the IFI altogether — and with no Australian wealth charge for a loan to work against, the deduction is measured entirely on the French base. The code sets three limits: a loan repaying capital at term is treated as amortising nonetheless, the deduction declining pro rata over its life and by one twentieth a year where no term is fixed; above €5M of taxable property, debt beyond 60% of the property's value counts only as to half, unless the borrower shows a mainly non-tax purpose; and only genuine debt counts — drawn, serviced, priced at market, and routed through an SCI's shareholder account it ceases to weigh in the valuation of the shares (article 973).

Sources considered: CGI arts. 669, 750 ter 2°, 751, 792-0 bis, 968, 970, 973–974, 990 D–990 E, 990 J, 1649 AB; 2006 convention arts. 6 §4, 13 §4. Scope note: structures are questions, not recommendations, settled with counsel in France and in Australia.

Reviewed as at 11 August 2026 · CGI arts. 669, 750 ter, 751, 792-0 bis, 968, 970, 973–974, 990 D–J, 1649 AB; 2006 convention arts. 6, 13

4What you pay when you sell — and the moving-country clause few treaties have

France taxes first, as the state where the property stands: article 13 §1 assigns gains on French immovables to France, and §4 — carrying the multilateral instrument's 365-day look-back — reaches gains on shares and trust interests that drew more than half their value, directly or through chains of entities, from French real estate. For the Australia-resident seller the French machinery is CGI article 244 bis A: the taxable gain shrinks by 6% for each year of ownership beyond the fifth and 4% for the twenty-second (article 150 VC); the income-tax component runs at 19% (article 200 B) and is extinct after 22 years, the social levies after 30; and taxable gains above €50,000 bear the progressive surcharge of article 1609 nonies G — 6% at the levels this market transacts. Per €1,000,000 of gross gain on a property sold at the Cannes median of €4.9M: after 10 full years the allowance is 30%, leaving €700,000 taxable, €133,000 of income tax and a €42,000 surcharge; after 15 years, 60%, €400,000, €76,000 and €24,000; after 22 years the income-tax component is extinct. The social levies apply at the full combined 17.2% — Australian affiliation sits outside the European coordination, as the Conseil d'État has confirmed for third countries (n° 400329, applying the European court's Jahin ruling). And representation: a seller domiciled outside the EU and the EEA appoints a representative accredited by the French administration (article 244 bis A, IV), the automatic exemptions — sales at €150,000 or less per seller, and sales fully exempt through the thirty-year clock — following the administration's instruction of 22 January 2025, with the deed's notaire ordinarily arranging the appointment.

Australia then answers as the residence state: the gain enters the Australian assessment under its own law, article 21 §3 treating French-taxed income as French-sourced so that the credit machinery engages, and article 23 §1 credits the French tax against the Australian charge — subject to Australian credit law, whose mechanics belong with the family's advisers.

Article 13 §5 — the step-up election for a change of residence

The convention carries a clause few treaties have. Where one state taxes a person AS IF THEY HAD SOLD their assets because residence there is ending — Australia's ceasing-residence capital-gains rules are the obvious case, France's exit tax the mirror — article 13 §5 lets the person elect, in the OTHER state, to be treated as having sold and reacquired the assets at market value on that day. The election prevents the same gain being taxed once on that imagined sale and again, years later, on the real one. It is file-specific in both directions and belongs on the checklist of any family relocating either way.

Leaving after the sale — what the exit tax does and does not reach

France's exit tax (CGI article 167 bis) concerns securities, not property: it reaches persons who were French-domiciled for at least six of the ten years before leaving, and taxes the unrealised gains on securities holdings above €800,000 in value, or stakes of 50% or more of a company's profits, as they stand on the day of departure. A property already sold has settled its own tax under the regimes above, and the sale proceeds are not within the charge. Shares of a family SCI follow the property rather than the portfolio: so long as the company keeps the ordinary income-tax regime, gains on its property-rich shares remain within the real-estate regime (CGI article 150 UB) and outside the exit tax. A family that leaves before six years of French domicile stands outside the latent-gains charge altogether. Where the machinery does apply, payment is generally deferred, the assessment lapses where the securities are still held two years after departure — five where the portfolio exceeded €2.57M — or upon a return to France, and article 13 §5's election is the treaty's own answer on the Australian side.

Sources considered: 2006 convention arts. 13 §§1, 4, 5, 21 §3, 23 §1; CGI arts. 150 UB, 150 VC, 167 bis, 200 B, 244 bis A (incl. IV), 1609 nonies G; BOI-RFPI-PVINR-30-20 (22 January 2025); CE n° 400329; CJUE Jahin C-45/17. Scope note: the Australian credit and ceasing-residence mechanics are questions of Australian law, stated at orientation.

Reviewed as at 11 August 2026 · 2006 convention arts. 13, 21, 23; CGI arts. 150 UB, 150 VC, 167 bis, 200 B, 244 bis A, 1609 nonies G; CE n° 400329

5Renting before you buy, and renting your property out

A rental year before buying remains the classic first step, and it deserves one plain caution: French tax domicile under CGI article 4 B rests on the foyer, the principal place of stay and the centres of professional and economic interest, none of which yields to the label on a lease. A property that becomes the family's effective home can found French residence, with worldwide consequences, before any purchase — and on this pair the treaty cascade that then decides is the shortened one of article 4 §3, with no habitual-abode step to fall back on. The choice between furnished seasonal rentals and the one-to-three-year civil lease sets the exit flexibility.

Renting the property out reverses the flow. French-source rents of a non-resident owner — the furnished rentals usual at this price point included, article 6 reaching "any other form of exploitation" — are assessed under the minimum-rate regime of CGI article 197 A, at no less than 20% up to the second-bracket ceiling and 30% beyond, unless a lower worldwide effective rate is demonstrated; the social levies add their full 17.2% on the third-country footing of § 4. The convention gives the income to France as the state where the property stands — and France taxing it does not stop Australia taxing it: Australia assesses its resident on the same income and credits the French tax (article 23 §1).

Sources considered: CGI arts. 4 B, 197 A; 2006 convention arts. 4 §3, 6, 23 §1. Scope note: treatment turns on the form of exploitation and on affiliation, both questions of fact.

Reviewed as at 11 August 2026 · CGI arts. 4 B, 197 A; 2006 convention arts. 4, 6, 23

6What happens to the property when you die, or give it away — one charge, whole, and French

No succession or gift convention exists between France and Australia — and, uniquely in this collection, nothing waits on the other side either: Australia abolished death duties by 1982 and levies no gift duty (orientation). The assessment is therefore French, and whole. French duty attaches to the property because it stands in France, whatever the owner's domicile, for estates and for lifetime gifts alike, and counts interposed entities in — an immovable held through companies in which the deceased or donor, with spouse, ascendants, descendants or siblings, holds more than half the interests is taxed as if it were held directly (CGI article 750 ter, 2°). Where the deceased was French-domiciled, or an heir has been French-resident for six of the ten preceding years, France taxes the worldwide transmission instead (750 ter, 1° and 3°). The scale is article 777's: progressive to 45% in the direct line beyond €1.8M per share after the €100,000 per-child allowance of article 779, the surviving spouse exempt in succession. Article 784 A, the only credit mechanism, operates solely in the worldwide cases and solely for foreign duty on assets outside France — and Australia levies nothing to credit. The values declared for the duty are the owner's own detailed estimate of market value (CGI articles 761 and 1897). On the Australian side, capital-gains tax does not as a rule arise at death: the heirs inherit the cost base and the charge defers to a later sale (orientation).

Testamentary freedom meets the French reserve

Australian succession law runs on testamentary freedom qualified by family-provision claims (orientation); the French property answers to French forced heirship. Under Regulation 650/2012, which France applies to every succession, an Australian national habitually resident in France may elect Australian law for the succession as a whole — and where a succession is governed by a law that permits no protective reserve mechanism for children, the compensatory levy of Code civil article 913, al. 3 can restore a child's reserved share out of assets located in France, its own condition being that the deceased or a child is an EU national or habitual resident — which in a third-state family runs through the family's European connections. The choice of law, the matrimonial regime carried into the purchase and the calendar of any gifts belong with counsel on both sides, before the pre-sales contract.

Sources considered: CGI arts. 750 ter, 761, 777, 779, 784 A, 1897; Code civil arts. 912–913; EU Reg. 650/2012. Scope note: Australian succession law is stated at orientation; the French analysis is the verified ground.

Reviewed as at 11 August 2026 · CGI arts. 750 ter, 761, 777, 779, 784 A, 1897; Code civil art. 913 al. 3; EU Reg. 650/2012

7The eight questions Australian owners ask most

Does an Australia resident pay French wealth tax on a Riviera property?

Yes — the IFI applies once French real-estate assets pass €1.3M, held directly or through the property fraction of company shares (CGI article 964). The 2006 convention covers income alone, so no treaty article limits or softens the charge; Australia levies no wealth tax of its own, so the cost arrives without a counterpart and without a credit.

Which country taxes the succession on a French property?

France, and only France. No succession convention exists, and Australia abolished death duties by 1982. French duty attaches to the property because it stands in France, counts family-held companies in (CGI article 750 ter), and runs to 45% in the direct line beyond €1.8M per share; where an heir has been French-resident for six of the ten preceding years, it extends to the worldwide transmission.

Are lifetime gifts taxed?

By France, yes — gift duty on the French property at the French scales, the démembrement mechanics of § 3 available. Australia levies no gift duty, so the French figure is the whole figure.

Who taxes the gain when an Australia resident sells a French property?

France first, where the property stands (article 13 §1), under CGI article 244 bis A with the duration allowances — the income-tax component extinct after 22 years, the social levies after 30. Australia then assesses the gain under its own law and credits the French tax (article 23 §1). Shares and trust interests follow the same route under the 365-day property-rich clause (article 13 §4).

What does article 13 §5 do for a family moving country?

Where one state taxes you as if you had sold up on ceasing residence — Australia's ceasing-residence rules, France's exit tax — the person may elect in the other state to be treated as having reacquired the assets at market value that day, so the same gain is not taxed twice across the move. The election is file-specific, in both directions.

Is rental income from France taxed if the owner lives in Australia?

Yes — France taxes it first as the state where the property stands (article 6), under the minimum-rate regime of CGI article 197 A — 20% at least, then 30% beyond the second-bracket ceiling — with 17.2% social levies in addition. Australia assesses the same income in its resident's hands and credits the French tax (article 23 §1).

Does French forced heirship bind an Australian family?

On the French property, it can. Australian testamentary freedom does not travel with the asset: a reserved portion goes to the children under French law, and where the applicable foreign law permits no protective reserve mechanism, the compensatory levy of Code civil article 913, al. 3 can restore a child's share out of assets located in France — its EU national-or-resident condition running, in an Australian family, through the family's European connections. Assessed on the succession's actual facts.

Does the sale require a fiscal representative?

As a rule, yes. A seller domiciled outside the EU and the EEA appoints a representative accredited by the French administration, who answers for the filing and the payment (CGI article 244 bis A, IV). Automatic exemptions cover sales at €150,000 or less per seller and sales fully exempt through the thirty-year holding clock; the deed's notaire ordinarily arranges the appointment.

Sources considered: these answers condense the sections above and inherit their scope notes.

Reviewed as at 11 August 2026

8The court decisions, the sources and the sales figures

The market first, because every figure above traces to it. Across Cannes and its hills (306 qualified €3M+ villa sales for €2,066M at a €4.9M median), the Saint-Tropez peninsula (1,006 sales, €7,049M) and Saint-Jean-Cap-Ferrat (178 sales, €6.5M median), the three registers cleared €11.5 billion across 2014–2025, each line traceable in the state's own transaction data — DVF (« Demandes de Valeurs Foncières », DGFiP), villa sales of €3M and above, duplicate estate records removed. At this edition the surveyed registers carry no ownership position attributable to Australian residence — the blank line is stated rather than passed over.

The legal method. Legal statements are verified against the Chiron Legal Corpus — the research library maintained by our agency's offshore legal-research partner — re-checked against the official sources at each edition. The review of 11 August 2026 covered Légifrance (CGI articles 4 B, 150 UB, 150 VC, 167 bis, 197 A, 200 B, 244 bis A incl. IV, 669, 750 ter, 751, 761, 777, 779, 784 A, 964–965, 968, 970, 973–974, 980, 990 D–990 E, 990 J, 1609 nonies G, 1649 AB, 1897; Code civil article 913 — consolidated texts) and the 2006 convention in its official consolidation with the multilateral instrument incorporated — BOTH authentic texts, French and English, held in our agency's corpus (signature clause read: the two texts equally authentic). The jurisprudence was read in the decision texts: CE n° 456349 and n° 414463 on the credit machinery — the convention's only reported appearances — and CE n° 400329 with CJUE Jahin C-45/17 on the social levies. The administration's commentary (BOI-INT-CVB-AUS) dates from 12 September 2012 and predates the multilateral instrument; where it and the texts diverge, this brief follows the texts.

Australian domestic law — the absence of death, gift and wealth taxation, the deferral of capital-gains tax at death, the foreign-income tax offset, the ceasing-residence rules, family-provision claims — is stated at orientation level from secondary sources and is never load-bearing for a legal claim.

What our agency is watching for the next edition: any first France–Australia succession instrument, which would rewrite § 6; annual budget law (Loi de finances) movements on the IFI and transfer duties; communal surcharge votes on the Riviera arc; any change to either state's reservations under the multilateral instrument; and any refresh of the 2012 commentary.

This brief documents published law and public transaction data; it is research rather than personalised legal or tax advice, and individual circumstances — residence history, nationality, matrimonial regime, the chain of title — change outcomes. For a live transaction, our agency coordinates the appropriate French counsel (avocat fiscaliste, notaire) and executes the property side.

Reviewed as at 11 August 2026 · decision texts read; both authentic treaty texts held; DVF register, duplicate estate records removed

Further intelligence

The Riviera villa market — the coast-wide €3M+ index

Riviera property tax & relocation — the incoming buyer's primer

France–Poland — the convention pair

France–Spain — the convention pair