When Does French Gift Tax Apply To Gifts From Residents To Non-Residents?

French gift tax rules change depending on who is resident and where the asset is located. In this episode, we explain when France taxes gifts made by French residents to non-resident recipients—and why documentation still matters even when the tax scope is limited.

🔎 What You’ll Learn in This Episode:

1️⃣ The Key Rule: Asset Location

When a French-resident donor makes a gift to a non-resident recipient, French gift tax applies only if the gifted asset is located in France.

➡️ France follows a territorial approach in this specific scenario.

2️⃣ Who Pays the Tax

Where French gift tax applies because the asset is located in France:

• The recipient (donee) is the taxable person

• The donor is not assessed for gift tax

This allocation reflects the structure of Articles 757 and 777 of the Code général des impôts.

3️⃣ Why Documentation Still Matters

Even though the donor is not taxed, they should ensure the gift is:

• Properly documented

• Formally executed (where required)

• Supported by clear valuation evidence

This is particularly important for high-value assets, where disputes may arise over the nature of the transfer or the value declared.

4️⃣ Practical Takeaway

For gifts from French residents to non-residents:

• French-situs asset → French gift tax may apply (recipient pays)

• Foreign-situs asset → No French gift tax

• Strong documentation reduces risk, even when tax exposure is limited

This episode clarifies a commonly misunderstood corner of French gift taxation—helping families and advisors apply the rules accurately and avoid preventable disputes.