When it comes to banking in France, as an expat, things might be a little different from what you’re used to back home. We ask the experts to explain some of the most common terms and facts about French bank accounts.
French Savings Accounts
An instant access savings account is called a “Compte sur Livret”. Banks also offer fixed term deposits, for over one month, which offer better interest rates, called “Comptes à Terme”. For large deposits, a “Certificat de Dépôt Négotiable” can offer slightly improved interest and a shorter term if required. Bank deposit interest is taxable, for income tax and “social taxes”.
However, there are various tax-free bank deposit accounts. For these the interest rates are fixed by the Government and the amount invested is limited. The most common accounts are:
‘Livret A’ – available from all banks: a maximum allowance per person plus accrued interest.
‘Livret de Développement Durable’ – available from all banks: a maximum allowance per person plus accrued interest.
The conditions of the accounts are the same and are regulated by the government and they’re only available to residents of France – including expats.
Interest is earned for every 15 day period on the balance of your account. It’s applied once a year – at the beginning of the year following investment. Or on closure of the account.
Access to funds: Access is instant but you may lose up to 15 days interest if you take out your money during an interest period. Ideally you should withdraw money on either the 2nd or the 16th of each month.
Tax treatment: Interest is totally tax free to French tax residents and should not be included on any tax declaration made in France.
For low-taxpayers, there is an account called the “Livret d’Epargne Populaire” (LEP). Offered by all banks, you have to prove, via a tax certificate, that you pay less than a specific amount of income tax in France, in order to qualify.
Share Dealing in France
You can hold a share dealing account at your bank, a stockbroker, or on the internet.
The normal safe custody account is called a “Compte Titres”. A share is an “action” and a Government or Corporate Bond is an “obligation”.
