France-US treaty: status and key articles
The France-US tax convention is comprehensive and has been in force since 1994 with subsequent protocols. Coverage includes income tax, dividends, royalties, capital gains, pensions, and residency tie-breakers.
- Article 7 (Business Profits): French-resident operating profits are taxable only in France without US PE.
- Article 10 (Dividends): 0% in qualifying parent-subsidiary cases. 5% for 10%+ ownership. 15% standard.
- Article 11 (Interest): generally 0% on portfolio interest.
- Article 12 (Royalties): 0% for most royalty types under the treaty.
- Article 24 (Relief from Double Taxation): French FTC mechanism for US tax paid.
Withholding rates by income type for French residents
| Income type | Default US rate | France treaty rate |
|---|---|---|
| US-source dividends (parent-sub qualifying) | 30% | 0% |
| US-source dividends (10%+ ownership) | 30% | 5% |
| US-source dividends (standard) | 30% | 15% |
| US-source portfolio interest | 30% | 0% |
| US-source royalties | 30% | 0-5% |
| Business profits without US PE | Generally not taxed | Generally not taxed |
How the DGFiP treats US LLCs
French tax authorities (Direction générale des Finances publiques) generally treat US single-member LLCs as transparent for French tax purposes, equivalent to a société de personnes. LLC income flows through to your French personal income tax return (Formulaire 2042 + 2047 for foreign source income).
Multi-member LLCs may be treated as partnerships or companies depending on the operating agreement. Consult an expert-comptable for clean French treatment, especially if running both an SAS and a Wyoming LLC.
How to file W-8BEN-E from France
- Line 1: LLC legal name
- Line 4: Chapter 3 status: Disregarded Entity
- Line 5: Country of residence: France
- Line 6: Permanent residence address in France
- Line 8: US TIN (EIN)
- Line 9: Foreign TIN (your French Numéro fiscal de référence)
- Part III: claim treaty benefits citing Article 10 for dividends or Article 12 for royalties
Common mistakes by French founders
- Not filing Formulaire 2047 (foreign source income) on French tax return
- Not filing W-8BEN-E with US payers (30% default applies)
- Missing Form 5472 + 1120 ($25K penalty)
- Triggering cotisations sociales on LLC pass-through income without budgeting
- Missing Article 209 B CGI (CFC) review for passive holding structures
- Not declaring foreign bank accounts on Formulaire 3916