Investing in real estate abroad frequently involves opening a local bank account to receive rent, pay co-ownership fees or manage the property's running costs. What many investors do not know is that a French tax resident who holds an account abroad, regardless of its balance, has a reporting obligation to the French tax authorities. This obligation is independent of any tax that may be owed. An account with little activity, or even one that is never used, must be declared in the same way as an active account.
Who is affected by this obligation
Any French tax resident who opens, holds, uses or closes a bank account abroad must declare it to the tax authorities. This applies in particular to accounts opened in connection with a property purchase in Dubai, Portugal, Spain or any other country, including when the account is used solely to receive rent or pay expenses.
The obligation applies as soon as the account is opened, regardless of the amount held or the sums passing through it.
Form 3916: what you need to know
Form 3916 (or 3916-bis for capitalisation and life insurance contracts taken out abroad) must be declared every year, at the same time as the income tax return, for each account held abroad at any time during the year concerned.
It must specify in particular the name of the banking institution, the address of the institution, the nature and number of the account, as well as the date of opening or closing where applicable.
The cost of failing to declare
Failure to declare a bank account abroad exposes you to a fine, which can be significantly increased when the account is held in a country that has not concluded an administrative assistance agreement with France allowing the exchange of banking information. Beyond the financial penalty, an undeclared account can also complicate proving the origin of funds in the event of an audit, particularly when reselling the property.
This guide is not a substitute for personalised advice
The tax rules applicable to a property investment abroad depend on your personal situation, the country concerned and changes in regulations. For any specific questions about your declaration, it is recommended that you contact your accountant or a tax lawyer, particularly before finalising an important investment.
How OSolto supports you
OSolto does not intervene in the tax or declaratory aspects of your investment, but provides access to secure international transfers to finance your acquisition and pay the ongoing costs of your property abroad, with named accounts and a dedicated contact person at every stage.
Are you investing in property abroad? Talk to an OSolto expert to secure your transfers related to your project.
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FAQ: declaring a bank account abroad
Do I need to declare an account abroad even if it is almost never used? Yes, the reporting obligation applies as soon as the account is held, regardless of the amount or frequency of use.
Does form 3916 have to be filled in every year? Yes, for every year in which the account was held, opened or closed at any time.
Does an account opened solely to receive rent need to be declared? Yes, the nature or use of the account does not change the reporting obligation for a French tax resident.
