Key Takeaways
- • French tax adviser Laurent Gravelle of Sophia-Antipolis says US clients often declare US pension schemes such as 401(k)s and Roth IRAs on the 3916 form, reasoning that it is better to provide too much information than too little.
- • The 3916 form covers foreign bank accounts, assurance vie and similar non-insurance wrappers, and cryptocurrency accounts.
- • Gravelle views Roth IRAs as potentially taxable in France but taxable only in the US under the US-France double tax treaty, and says they could be seen as a stocks-and-shares portfolio that should be declared.
- • UK SIPPs are generally accepted as pensions and not declarable, though self-managed versions may test the line between reporting and not reporting.
- • Declaring all pension funds is the cautious route, avoiding uncertainty over which products France treats as true retirement pensions.
Summary
A reader asked Connexion France whether US pension schemes such as 401(k)s should be listed on the 3916 form, the French declaration of foreign bank accounts and investment schemes, after omitting them from their annual return. The 3916 covers foreign bank accounts, assurance vie and similar non-insurance wrappers, and cryptocurrency accounts.
Avocat fiscaliste Laurent Gravelle, based in Sophia-Antipolis and regularly advising foreign clients, said that his US clients often include such schemes on the 3916, on the basis that it is better to provide too much information than too little. He said people holding Roth IRAs, a US retirement account funded with after-tax money in which investments can grow free of US tax and qualifying retirement withdrawals are generally free of US income tax, often declare them.
Gravelle said that if the money stays in a Roth IRA, the income inside is exempt. In his view, the account could be considered potentially taxable in France, but for a US national resident in France it is taxable only in the US under the US-France double tax treaty. He added that it could be seen as akin to a stocks and shares portfolio and should therefore be declared.
More generally, he said that taxpayers wishing to avoid any risk can declare all their pension funds. This sidesteps the question of which products France regards as a true retirement pension, which need not be declared, and which are closer to an investment scheme.
For British holders of UK SIPPs, Gravelle said the answer is generally no, as they are normally accepted as pensions, though they can sometimes work like a portfolio. Where an individual manages the investments inside a SIPP themselves, he said this may test the limit between the obligation to report and not reporting, and that a highly individualised arrangement could be declared for safety.
Avocat fiscaliste Laurent Gravelle, based in Sophia-Antipolis and regularly advising foreign clients, said that his US clients often include such schemes on the 3916, on the basis that it is better to provide too much information than too little. He said people holding Roth IRAs, a US retirement account funded with after-tax money in which investments can grow free of US tax and qualifying retirement withdrawals are generally free of US income tax, often declare them.
Gravelle said that if the money stays in a Roth IRA, the income inside is exempt. In his view, the account could be considered potentially taxable in France, but for a US national resident in France it is taxable only in the US under the US-France double tax treaty. He added that it could be seen as akin to a stocks and shares portfolio and should therefore be declared.
More generally, he said that taxpayers wishing to avoid any risk can declare all their pension funds. This sidesteps the question of which products France regards as a true retirement pension, which need not be declared, and which are closer to an investment scheme.
For British holders of UK SIPPs, Gravelle said the answer is generally no, as they are normally accepted as pensions, though they can sometimes work like a portfolio. Where an individual manages the investments inside a SIPP themselves, he said this may test the limit between the obligation to report and not reporting, and that a highly individualised arrangement could be declared for safety.
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