Does France's impatriate regime under Article 155 B lower my US tax?

No. Article 155 B is a French income tax relief only. As a US citizen you report your full wages on Form 1040, including the impatriation premium France exempts. The US-France treaty's saving clause preserves US taxation of citizens. The regime's only US effect is indirect: lower French tax means fewer foreign tax credits, which can leave a residual US liability in full Paris years.

Can I claim the Foreign Earned Income Exclusion in the year I move from London to Paris?

Often yes, through the physical presence test, because days in both the UK and France count as foreign days. You need at least 330 full days abroad in a 12-month period and a foreign tax home. The bona fide residence test needs an entire tax year of foreign residence, so it is usually tested later. Whether electing the exclusion is wise depends on your credit position.

Will HMRC still tax me in the UK after I move to Paris mid-year?

If you were UK resident for the tax year, HMRC taxes your worldwide income for the whole year unless split-year treatment applies. Split-year treatment needs you to fit one of the statutory departure cases, such as starting full-time work overseas or ceasing to have a UK home. Frequent London workdays can break the overseas-work case, so your travel diary decides the outcome.

How is a London bonus paid after I arrive in Paris taxed?

The UK may still tax the share earned on UK workdays, France may tax it as received while you are French resident, and the US taxes the whole payment when received or vested. For Form 1116 we source each award by workdays across its earning period and match it to the UK and French tax actually paid after treaty relief, so credits are neither overclaimed nor lost.

Are French CSG and CRDS social charges creditable against US tax?

The IRS position on CSG and CRDS has changed over time. For some years the IRS treated them as social security taxes covered by the US-France social security agreement, which blocks a credit, and that stance changed in 2019 after an understanding between the two governments. Treatment can depend on the levy, the income and the year, so we review it case by case and consider amending earlier years.

Do I need to keep filing UK returns after I leave London for Paris?

You file a UK return for the departure year, normally claiming split-year treatment if a case applies. After that, a UK return is usually needed only if you keep UK-source income such as UK rent, a UK directorship or deferred UK pay vesting later. UK accounts you keep open remain reportable on your FBAR and, above thresholds, on Form 8938, whatever HMRC requires.

US Expat Tax Returns Under France's Impatriate Regime

US tax return preparation for expats who move from London to Paris under France's impatriate regime comes down to one point that catches most clients: the French exemption under Article 155 B of the Code général des impôts lowers your French tax, but it does nothing to your US tax. The United States taxes its citizens on worldwide income, so every euro France exempts stays fully reportable on your Form 1040. Less French tax paid also means less foreign tax to credit, which is why a generous French regime can leave a residual US bill that did not exist in London.

This guide is written for US citizen investment bankers, fund executives and senior managers taking a Paris role after a London posting. It covers what the impatriate regime actually exempts, how that changes the Form 1116 credit and the Form 2555 exclusion calculation, how the UK departure year is split under the Statutory Residence Test, and how three different tax years (the US calendar year, the French calendar year and the UK year ending 5 April) have to be reconciled in the move year.

What is France's impatriate regime under Article 155 B?

The impatriate regime is a French income tax relief for people recruited from abroad, or sent by a foreign employer, to take up a role in France. It is set out in Article 155 B of the Code général des impôts, and the French administration's official commentary is published in the BOFiP at https://bofip.impots.gouv.fr/bofip/5677-PGP.html. In plain terms, Article 155 B is a time-limited French exemption for the extra pay a person receives because they relocated to France, plus pay for work carried out abroad in the employer's interest.

According to that commentary, the relief runs for each year of French tax residence up to 31 December of the eighth year after the person takes up their functions in France. Eligibility also turns on not having been resident in France for a look-back period before arrival, which we confirm against the client's history before the first French return is filed. The regime has three moving parts that matter for the US return:

The impatriation premium. Extra pay linked to the relocation is exempt from French income tax for its actual amount when it is set out in the employment contract, or set by objective criteria such as a percentage of fixed or variable pay. Where taxable pay falls below the reference pay for comparable roles in France, the exemption is restricted.
The 30% flat option. Instead of identifying an actual premium, the taxpayer can elect to treat the premium as 30% of net total remuneration. The BOFiP notes this option was extended in November 2018 to people sent by a foreign employer, not just those recruited directly from abroad.
Foreign-activity pay. Pay for work done outside France during the impatriate period can be exempt where the trips serve the employer's direct and exclusive interest, typically measured by days worked abroad against total working days.
Two alternative ceilings. Each year the taxpayer chooses either a global cap, where the total exemption cannot exceed 50% of total remuneration, or a cap on the foreign-activity element alone at 20% of taxable pay net of the premium.

Does the impatriate exemption reduce US tax for an American in Paris?

No. This is the misunderstanding we correct most often in first meetings. A US citizen reports gross worldwide wages on Form 1040 regardless of how the other country treats them. The impatriation premium, the 30% deemed premium and the exempt foreign-activity pay are all wages for US purposes. The US-France income tax treaty, whose 1994 text and the 2004 and 2009 protocols are listed at https://www.irs.gov/businesses/international-businesses/france-tax-treaty-documents, contains a saving clause that preserves the US right to tax its own citizens as if the treaty did not exist, subject to listed exceptions that do not include French domestic incentives like Article 155 B.

So the honest framing is this: Article 155 B is a French benefit, and its US cost is a smaller foreign tax credit. For a banker whose London pay was taxed at UK rates high enough to cover the US liability almost entirely, the Paris package can produce a gap. How large that gap is depends on the split between salary, bonus, carried interest or deferred awards, and investment income, which is why we model the US return before the client chooses between the actual-premium route and the 30% option, and before choosing between the two French ceilings.

How does US tax return preparation for expats work in the London to Paris move year?

The move year is the hardest return in the sequence, because the client is resident in three systems on three different calendars. The US return covers 1 January to 31 December. The French return also follows the calendar year, but only from the date French residence begins. The UK tax year runs from 6 April to 5 April, so a September move falls in the middle of a UK year that started under London residence and will end long after the client has gone.

In the returns we prepare, the move-year US file needs, at minimum:

Form 1040 reporting all wages from the UK employer and the French employer (or the same group's French entity), converted to US dollars, plus all investment income in both countries.
Form 1116 for the general category, with UK and French income taxes on wages allocated by workdays, and a separate Form 1116 for passive category income such as interest and dividends on accounts in both countries.
Form 2555 only if the exclusion is the better route, tested against the physical presence test because the bona fide residence test cannot yet be met in France for the move year.
An allocation schedule for any bonus, deferred cash or share awards that vest after the move but were earned partly in London, sourced by workdays across the vesting period.
FBAR reporting for UK and French accounts held at any point in the year, including new French current and savings accounts opened on arrival and UK accounts kept open after departure.
A treaty-position review, with Form 8833 where a return position relies on a specific treaty article rather than domestic law.

Should you use the Foreign Earned Income Exclusion or the foreign tax credit in France?

The Foreign Earned Income Exclusion lets a qualifying individual exclude foreign earned income up to an inflation-adjusted annual limit, claimed on Form 2555. The IRS page at https://www.irs.gov/individuals/international-taxpayers/foreign-earned-income-exclusion sets out the tests: a US citizen must be a bona fide resident of a foreign country for an uninterrupted period that includes an entire tax year, or be physically present in a foreign country for at least 330 full days during any 12 consecutive months, and in either case have a tax home abroad. We take the current-year cap from the latest Form 2555 instructions when we file, rather than quoting a figure that changes every year.

For a London to Paris move there is a detail that works in the client's favour: days in the UK and days in France are both foreign days. A banker who spent the first eight months in London and the last four in Paris may well pass the physical presence test for the whole year, with only US days counting against the 330.

Whether the exclusion is the right choice is a separate question. For the income levels our clients have, the exclusion usually covers only a fraction of pay, and electing it has knock-on effects: the excluded income is still counted when working out the rate on the remaining income, and French and UK tax attributable to excluded wages cannot also be credited. Under the impatriate regime the arithmetic shifts again, because a large part of French pay is not taxed in France at all. The exempt premium carries no French tax, so excluding it under Form 2555 costs nothing in lost credit, while crediting the taxed slice uses the French tax that was actually paid. In some years combining the two produces the lowest US liability; in others the credit alone is better because it preserves excess credits for carryforward. We run both versions every year rather than assuming.

Are French social charges such as CSG and CRDS creditable on Form 1116?

French social charges sit on top of French income tax and apply to both employment and investment income. The generalised social contribution (CSG) and the social debt repayment contribution (CRDS) have had a contested history in US practice. The IRS for some years treated them as social security taxes covered by the US-France social security agreement, which would make them non-creditable, and the position changed in 2019 following an understanding between the two governments. Because the treatment depends on which levy, which income stream and which year, we handle it case by case, and we look at whether earlier years filed without the credit are worth amending.

The practical point for an impatriate is that social charges are not reduced by Article 155 B in the same way as income tax, so in the Paris years they can make up a larger share of the total French levy. Getting their creditability right can matter more than it did for an American who arrived in France on a standard package.

How does UK split-year treatment work when you leave London for Paris?

On the UK side, the departure year is governed by the Statutory Residence Test. Split-year treatment divides a single UK tax year into a UK part and an overseas part, so that income from the overseas part is generally outside UK tax for a UK resident leaver. It does not apply just because someone moved; the person must be UK resident for the year and fit one of eight statutory cases. HMRC's manual at https://www.gov.uk/hmrc-internal-manuals/residence-and-fig-regime-manual/rfig21030 explains that Cases 1, 2 and 3 cover departures, and that when more than one departure case applies, Case 1 takes priority over Cases 2 and 3, and Case 2 over Case 3.

For our clients the candidates are usually Case 1, starting full-time work overseas, and Case 3, ceasing to have a home in the UK. Case 1 is designed for exactly this move but has demanding conditions on hours worked overseas and limits on UK days and UK workdays in the overseas part, and a banker who keeps flying back to London for deal meetings can fail it. Case 3 then becomes the fallback, with its own conditions about disposing of the London home and setting up a connection with France. We test both on the client's actual travel diary rather than on the relocation date in the contract.

Case 2 covers a partner who follows. If one spouse moves first to start the Paris role and the other follows later, HMRC's guidance at https://www.gov.uk/hmrc-internal-manuals/residence-and-fig-regime-manual/rfig21110 sets the deemed departure day for the accompanying partner, and https://www.gov.uk/hmrc-internal-manuals/residence-and-fig-regime-manual/rfig21100 explains who counts as a partner for this purpose. Couples with staggered moves therefore need two separate split-year analyses on the UK side, while for US purposes a married couple filing jointly still produces one Form 1040.

Why does the UK split date matter on the US return?

The UK split date drives which UK tax is owed and on which income, and that is the UK tax figure that feeds Form 1116. If the split-year claim fails, the client is UK resident for the whole UK year and France and the UK may both claim to tax the September to April Paris earnings, leaving the double taxation to be relieved under the UK-France treaty. Because the US return is usually filed before the UK and French figures are final, we diarise a foreign tax redetermination and correct the US return when they settle.

What happens to a London bonus paid after you arrive in Paris?

This is the gap we see least well handled. Investment banking compensation is often deferred: a bonus for the year in London may be paid in cash months later, and share awards vest over three or more years. When the client is already in Paris, three countries can have a claim on the same payment.

The UK generally looks to where the work was done, so a portion of a deferred award earned during UK workdays can remain within UK tax even after departure, and the UK employer may still apply UK payroll withholding.
France will look at whether the payment is received while the client is French resident, and whether any part relates to work in France or qualifies under the foreign-activity exemption.
The US taxes the whole payment in the year it is received or vests, regardless of either country's position, and sources it between countries by workdays for Form 1116 purposes.

The US sourcing exercise is where the credit is won or lost. If the UK taxes the London-earned portion and France taxes the same portion again, only the tax properly attributable to foreign-source income in each country, after treaty relief, belongs on Form 1116. We build a vesting schedule for every award, allocate London, Paris and US workdays across each vesting period, and match it to the UK and French tax actually suffered. Without it, credits are either overclaimed, which invites an IRS adjustment, or underclaimed, which leaves money on the table.

A worked scenario: a US banker relocating from London to Paris

The figures below are an illustration only, built for this article. They are not drawn from any client file, the French tax figures are assumed rather than computed, and the exchange rates are assumptions chosen for round numbers: 1 GBP = 1.25 USD and 1 EUR = 1.08 USD.

Alex is a US citizen managing director who lived in London for six years. On 1 September 2026 Alex moves to Paris to join a French group entity on a package of EUR 420,000 base salary a year, and elects the 30% flat option under Article 155 B. Alex keeps a London flat until it is sold in November and returns to London for nine working days between September and December.

January to August London salary: GBP 200,000, or USD 250,000 at the assumed rate. UK tax withheld through payroll, assumed at GBP 78,000 (USD 97,500).
February 2026 London cash bonus for the 2025 performance year: GBP 300,000, or USD 375,000, all earned on London workdays, fully taxed in the UK.
September to December Paris salary: EUR 140,000, or USD 151,200. Under the 30% option EUR 42,000 is treated as exempt premium, leaving EUR 98,000 in the French base.
French income tax on the Paris slice, assumed for illustration at EUR 30,000 (USD 32,400), plus social charges assumed at EUR 12,000 (USD 12,960).
Total wages on the 2026 Form 1040: USD 776,200, every dollar of it, including the EUR 42,000 exempt in France.

On the US return, the London income carries UK tax at rates that, in this illustration, comfortably cover the US tax on that income, producing excess general-category credit. The Paris slice is the problem: USD 151,200 of wages carries only USD 32,400 of French income tax, because almost a third of it was exempt in France. In our model, the excess UK credit from January to August absorbs the residual US tax on the Paris wages, because both sit in the same general-category basket and the Form 1116 limitation is calculated on the combined figure. Alex owes little or no US federal tax for 2026.

The picture changes in 2027, the first full Paris year. There is no high-taxed London salary to shelter the exempt premium, and any excess UK credit carried forward will run down. Unless the social charges are creditable and large enough, or the Form 2555 exclusion is layered onto the exempt slice, Alex can face a real US liability on roughly the amount France chose not to tax. That is why we plan the 2027 return in the autumn of 2026, before French payroll for the new year is set, and why we recommend the client's French return choices are made with the US numbers in front of them.

On the UK side, Alex's nine London workdays and the November sale of the flat are what we test against Case 1 and Case 3. If neither applies, Alex is UK resident for the whole of 2026-27, and the Paris salary from September to April must be relieved under the UK-France treaty, which changes the UK tax figure on the US return.

Decision table: which route fits your move year?

If you have high-taxed UK salary for most of the move year, then the foreign tax credit alone usually covers the Paris months, and the exclusion is rarely worth electing in the move year.
If you elected the 30% option and your Paris pay is your only earned income, then model a combination of Form 2555 on the exempt slice and Form 1116 on the taxed slice before filing.
If you have large UK excess credits carried forward, then avoid elections that strand them, because revoking the exclusion later has its own restrictions.
If you keep returning to London for client work, then assume UK split-year Case 1 may fail and test Case 3 on your home and connection facts.
If deferred awards vest after the move, then build a workday sourcing schedule per award before preparing any of the three returns.
If your spouse moves later, then prepare two UK residence analyses alongside a single joint US return.

What else changes on the US return once you live in France?

In the returns we prepare for impatriates, these reporting items come up repeatedly:

French bank and savings accounts go on the FBAR and, above the relevant thresholds, on Form 8938; UK accounts kept open after the move stay on both.
French collective funds bought through a local bank are usually PFICs, and a UK ISA kept after departure gives no US tax shelter, so income and gains inside it remain reportable.
A sold London home is reported on the US return in dollars, with the gain measured against the dollar cost at purchase, so currency movement alone can create or remove a US gain that the UK never sees.
French withholding at source changes the timing of French tax payments, which we track when choosing between the paid and accrued methods for the foreign tax credit.

Late FBARs for any of these accounts are filed through FinCEN's BSA E-Filing System with a statement of the reason for late filing, or within the Streamlined Filing Compliance Procedures where returns are also missing. For a non-resident filer who qualifies for the Streamlined Foreign Offshore Procedures, there is no penalty.

Step by step: how we prepare the impatriate US return

Step 1: Build a day-by-day travel and workday diary for the full calendar year, marking US, UK, French and third-country workdays.
Step 2: Collect UK payroll records and the UK departure-year return, French payslips and the French return.
Step 3: Confirm the Article 155 B route chosen (actual premium or 30% option) and the ceiling elected, and quantify the French-exempt portion of pay.
Step 4: Map each deferred bonus and share award to its earning period and allocate workdays by country.
Step 5: Run two US calculations, credit only and exclusion plus credit, across the move year and the following year, including carryforwards.
Step 6: Prepare Form 1040 with Forms 1116, 2555 where chosen, 8938, 8621 and 8833 as applicable, and file the FBAR separately.
Step 7: Diarise the foreign tax redetermination for when UK and French liabilities are final, and plan the next year's French choices against the US result.

How long does the US exposure last under the impatriate regime?

The French relief ends after the eighth year following arrival, so the US gap is temporary. Once the impatriate exemption falls away, the full Paris salary is taxed in France at standard rates, and the foreign tax credit usually covers the US liability again. The years in between, however, can carry meaningful US tax on income France has deliberately left alone. We treat the US return as part of the relocation package: the premium, the exemption route and the ceiling chosen each year all feed a US calculation the French payroll team will not run.