Hello everyone,
I am taking the liberty of writing this post in French because it mainly concerns the French community. I would like to understand the benefits of living in Monaco as a French person if not the idillic living environment.
I am French bi-national and I am very attached to the region. I currently live abroad but am thinking of returning to the south in a few years and Monaco is eyeing me.
BUT because there is a “but”, I was wondering what the legal and fiscal status of the French in Monaco really is.
– I know that as a French citizen, even a dual national, I will find myself subject to French taxation but I wonder how far this extends? Income tax? Dividends? The inheritance? Capital gains? Be a shareholder? Etc
– A solution that seems possible to me would be to renounce French nationality and keep only my second nationality. I wonder if this is happening and if anyone has already done it. Cases of renunciation of French nationality are rare and quantified, we expect barely 100/years of memory. For me it would also mean separating myself from what ties me to the country of my heart and I don’t think I want to take the plunge even to reduce my taxes to 0. (+ renunciation takes more than a year), Likewise, is the nationality recoverable behind? In theory yes but the same would be at the discretion of the French State and it would also take years. Definitely not a choice to take lightly.
I’m really intrigued by the French community in Monaco. I am aware that certain families have a special status due to their presence in the principality for a while… but I am certain that other French people live there and use their legal schemes or not to optimize their status.
In short, it’s an open subject and I’m listening to everything about your daily life, which intrigues me as much as possible:
– What are the advantages of being French there, if there are any?
– Do you feel Monegasque?
– Are there any young people (<40 years old) naturalized other than high-level athletes?
– How do you see Monaco continuing to evolve over the next 20 years?
– Do you think that France will impose a new framework on Monaco or will not do so as long as the principality brings in more indirectly than what it takes in?
– Are there any known arrangements used in Monaco by French residents?
– If a Monegasque lives in France outside of Monaco, how is he taxed?
– Many Monegasque residents actually live in their villas in Mougins, Nice, Cannes and surrounding areas, is this tolerated?
– How is it that many French entrepreneurs set up there without having their business there? What’s the point?
– If I am a shareholder of a company in Monaco, how is this company taxed?
– What impact does it have for a French resident to own a company in Monaco that is so legitimate?
– Are vehicles registered in Monaco “parkable” on French soil all year round without insurance problems? Lots of people do it in second homes
The subject is vast, have fun!
PS: I am open to DMs for the most discreet among you 🙂
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Posted by oc1xxx
2 Comments
Most of what you’re imagining doesn’t actually work the way you think, mainly because of the 1963 Franco-Monégasque tax convention. Short version: if you’re French and you settle in Monaco after October 1957, France still taxes you on income as if you were a French resident. That single rule closes the main “loophole” 99% of French people picture when they think about Monaco. The grandfathered exception is for people whose family was already established there before that cutoff, and it’s a tiny, shrinking pool.
So your question of “why do French entrepreneurs settle in Monaco without their business being there” usually has one of these answers: they’re in that pre-1957 grandfathered group, they’re playing a non-income-tax angle (inheritance is the big one), they’re French nationals but not actually French tax residents (those are different things), or they’re hoping not to get audited.
A few specifics on your list:
Inheritance is governed by a separate 1950 convention and is location-of-asset based. That’s where the actually useful stuff is for Monaco residency: 0% in direct line, harder for France to recapture if you structure things cleanly. Worth talking to a notaire about.
Companies in Monaco pay ISB (corporate tax) at 25% if more than 25% of turnover comes from outside Monaco. So it’s not a corporate haven. If you as a French tax resident own a Monaco SAM and pull dividends, France taxes those at the flat tax. You basically gain nothing.
Renouncing French nationality is real but discretionary. You need another nationality first (you’ve got that), and the admin can drag the process out or refuse. Reintegration later is also discretionary and usually means actually moving back to France. Almost nobody does this purely for tax reasons because the math rarely works.
Cars: if you’re a French tax resident, technically you should register and insure in France. Monaco-plated cars sitting in Mougins or Cap d’Antibes year-round are a well-known phenomenon and customs do occasionally crack down. Insurance gets messy if you crash and they look at where the car actually sleeps.
Naturalization as Monégasque under 40 without being an Olympic medalist: extremely rare. Sovereign decree of the Prince, generally 10+ years residence with serious ties. They keep the actual Monégasque population around 9k on purpose.
Honest take: for most French nationals, Monaco residency is a lifestyle play, not a tax play. The tax angle is mostly shut by the 1963 treaty. Exceptions are inheritance planning, dual-national strategies, or people genuinely willing to emigrate properly. If you’re not in one of those buckets, you’d pay roughly the same income tax in Monaco as you would in France, plus you’re paying Monaco real estate prices.
Talk to a fiscaliste who specializes in cross-border before doing anything. Lot of edge cases here and the wrong setup gets expensive fast.
Le commentaire précédent a parfaitement répondu à ta question. Ça ne vaut pas la peine de vivre à Monaco en étant français, dans de nombreux cas, tu resteras redevable fiscalement envers la France. L’exception concerne tes enfants : s’ils naissent et grandissent à Monaco jusqu’à leurs 18-19 ans, la situation est différente. Pour ma part, j’ai renoncé à ma nationalité française pour m’y installer, ayant déjà d’autres passeports ,ce qui simplifie considérablement les choses. Donc si tu en as les ressources et d’autres passeports, autant envisager de le faire, mais consulte avant tout un cabinet d’avocats fiscalistes.