Making your money grow abroad is possible and legal. Only, it is necessary to respect the fiscal regulation in force which consists in particular in declaring to the Fisc the generated incomes. Multiple possibilities open to the French in terms of foreign investment. From real estate to savings, going through the stock market, here’s how to invest well abroad.
Why invest abroad?
There are several reasons why the French can invest abroad. Among other things, we note the poor performance of local investment products. Most French people who have money to put aside choose the Livret A and the life insurance in euros to invest their money. These financial investments are no longer as attractive as they used to be. Their low yield (0.75% for Livret A and 1.5% for life insurance in euros) makes it no longer as interesting to choose these types of investments, at least in France.
- One of the main reasons motivating the French to put their money in another country is tax optimization. The tax pressure they experience in their country of origin pushes them to invest elsewhere in order to benefit from a more lenient taxation.
- Other reasons may also encourage the French to take the plunge like the affordable prices that are practiced in other countries. These attractive prices prompt many French to embark on real estate investment abroad. Destinations like Florida or Germany are very popular in this sector.
- There is also the good economic health of the chosen jurisdiction. The economic and political stability of a country can open multiple investment opportunities. Despite the global financial crisis, some countries seem to be doing better than others.
- In the face of the economic crisis, many French people also see foreign investment as a kind of plan B to deal with any eventuality. In addition to bringing them money, this solution is a kind of lifesaver for them in case things go wrong.
- Another reason that has nothing to do with financial reasons is the realization of a dream. Those who have always dreamed of living in a warm and sunny place can be attracted by foreign investments.
Formalities for investing abroad
With the abolition of exchange controls on one side and globalization on the other, it has never been easier to do business abroad. All French savers are now entitled to invest their wealth or open a bank account abroad. Nevertheless, some tax obligations must be respected. They must mention in their tax return all accounts opened or closed on their behalf during the year. Make a visit to https://imperiallegal.uk/immigration/tier-1-investor/ for getting the best understanding now.
When a person leaves France with the sum of € 10,000 or more, she must fill out a form at the customs. This is the same procedure to follow when a person makes a transfer or savings to a foreign bank of more than € 10,000. The difference is that the bank takes care of the formalities.