Germany France Double Taxation Treaty

Double taxation agreement between Germany and France

Germany has signed its first double taxation agreement with France in 1959. The agreement was ratified in 1961 and enforced in 1962. Ever since the convention went through multiple changes and was amended several times, the last amendment being added in 2003. However, the two contracting states have added other provisions to their double taxation agreement, one with respect to the taxation of cross-border employees in Germany, respectively in France, and one with respect to the taxation of inheritance, successions, and fortune. At the beginning of this year, the double taxation treaty between Germany and France was revised and changed. However, it is pending ratification in both countries.

What are the taxes covered by the Germany-France double taxation treaty?

The double taxation agreement covers the income tax in Germany and France. Income taxes apply as follows:

• - in France, the double tax treaties cover the income tax applied to individuals, the income tax applied to non-commercial professions, the corporate tax, the taxation of royalties, the property tax, and the solidarity surcharge on inheritance,
• - in Germany, the double taxation agreement covers the income tax, the corporate tax, the solidarity surcharge, the inheritance tax, the taxation in income resulted from royalties, the property tax.

For information about the elimination of double taxation on income according to the agreement, you may refer to our German attorneys.

Amendments brought to the Germany-France double tax treaty

The amendments brought to the double taxation agreement between Germany and France contains the following:

• - the tax treatment applied to income resulted from the sale of property in Germany and France,
• - allows both France and Germany to tax certain dividends at the domestic tax rate,
• - provisions new tax regulations for income resulted from cross-border state pensions and retirement benefits.

The agreement also provides new amendments brought to arbitration procedures in Germany and France. The agreement will be enforced the following year after the ratification in both countries.

For complete information about all the changes brought to the double taxation convention with France, you may contact our law firm in Germany.