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AMERICANS IN FRANCE

What are the biggest challenges for Americans in France?

Moving countries is always difficult, but from bank accounts to driving licences, tipping to customer service, there are some particular challenges that Americans in France face.

Published: 25 February 2022 08:43 CET
Updated: 28 February 2022 17:10 CET
What are the biggest challenges for Americans in France?
Photo: Loic Venance/AFP

When you encounter problems in your new country it’s easy to feel as if you are all alone and it’s all your fault – but in fact it could be your nationality that’s the issue.

We’re not trying to put you off – France is a lovely country – but sometimes it helps to know that it’s not just you.

And  on the plus side, if you make your move to France a big success, you can end up being given the honour of being Panthéoniser, like your compatriot Josephine Baker.

Bank accounts 

The issue that American readers of The Local raise most often is that of bank accounts and the increasing difficulty of opening one in France.

A French bank account is vital if you are working, want to sign up to the healthcare system and in many cases to rent an apartment. But a piece of legislation called FATCA means that French banks are increasingly reluctant to take on any new clientele who hold a US passport.

So don’t be surprised if you are turned down flat when you try to open an account, even if you have plenty of money and an excellent credit rating.

You can find a full explanation of the problem, and what to do about it, HERE.

Tax

You’ve left the USA but that doesn’t mean that it’s keen to let you go. As a US passport holder you will almost certainly still be required to file a tax declaration to the IRS, even if you no longer have any income in the USA.

Most residents in France are also required to file a tax declaration (even if all your income comes from the US eg a pension), so you will find yourself filing two declarations a year. In good news though, France and the US have a dual taxation agreement, so at least you won’t be paying tax twice on the same income, it’s just extra paperwork.

READ ALSO How to fill in a French tax declaration

Virtually the only way to wriggle free of the IRS’s clutches is to renounce your American citizenship, but that’s a complicated and expensive process, which many US consulates are currently refusing to even allow you to begin.

Driving

This one is a question of luck – if your licence was issued in a US state that has an agreement with France then you can simply swap your licence for a French one.

If, however, your licence was issued by a state that has no agreement with France then we have some very bad news for you – you will have to take a French driving test. This is expensive because there are a minimum amount of lessons you must take, as well as being challenging for people who do not have fluent French. 

READ ALSO Four years and €1,800 – taking the French driving test as an American

This the reason why many Americans, especially those living in French cities, simply don’t drive at all. Find the full list of States HERE.

Visas and cartes de séjour

This isn’t specifically limited to Americans, all non-EU citizens need a visa or residency card to live in France, but the process can be a complicated one.

Getting the visa and arriving in France is far from the end of the process – full details HERE.

In some good news, the days of going to the préfecture with an enormous file of papers are coming to an end as an increasing number of processes including carte de séjour renewal move online.

Culture shock

It’s not just the practical issues, moving countries brings a culture shock with it that almost all new arrivals experience. 

Tipping

The tipping culture in France is very different to the US and it’s perfectly OK not to leave anything at all for your server.

Hospitality staff receive a decent wage in France so they’re not relying on tips to make up their wages.

READ ALSO How much to tip in France

If you’ve had a nice meal and your server was helpful it’s always appreciated to leave a little extra, but this can just amount to some coins or ’rounding up’ your bill.

A tip in France is known as a pourboire – literally ‘for a drink’ – and this is how it’s seen, a pleasant little extra but not required.

Customer service

Some unkind people say that there’s no word in French for customer service. We wouldn’t quite go that far, but it’s certainly different.

The concept of ‘the customer is king’ doesn’t really exist (maybe just as well when you remember what the French did to their kings) and while many French bureaucrats, servers and sales staff are very helpful and friendly others are not, and there’s not really much you can do about it.

It’s best to always be polite – and start with a bonjour – even if you have a very justified complaint. 

There’s an upside to this though – sales staff, especially in independent businesses, see their role as to advise you rather than to serve you which means you get their specialist knowledge as well as the cheese/wine/clothes that you’re buying.

Fonduegate: Why the customer is not always right in France

Complaining 

But if you want to complain about a rude sales assistant then you will fit right in with the French, who also love a good complain.

The French habit of complaining can be hard for some newcomers to adjust to, especially if you come from a culture where people generally express themselves more positively.

It can come over as very negative, but really it’s more of a habit and you may eventually grow to love it.

READ ALSO Why I love the French habits of scolding and complaining

Likewise if you ask a French friend their opinion on your new haircut don’t expect them to sugarcoat it – if they think it makes you look like Gérard Depardieu in a wig then they’ll tell you, and count it as a friendly and honest gesture.

Ice and air-con

Air-conditioning does of course exist in France, but while it’s common in shopping malls, hotels and offices it’s rare to find it in private accommodation.

Most apartments in Paris don’t have air-con (or an elevator come to that, check carefully with the real estate agent), nor do homes in the south of France.

You can spend a small fortune buying your own place and installing air-conditioning, but it might be easier (and better for the planet) to just buy a fan and accept that you will be hot during the summer months. 

Likewise if you want ice in your drink you will need to ask for it (avec glaçon) as beverages are not routinely served with ice.

What were your biggest culture shocks when you moved to France? Share your experiences at [email protected]

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AMERICANS IN FRANCE

Americans in France: Will my tax situation change if I get French citizenship?

If you're thinking of applying for French citizenship, then you might be curious whether there will be any tax ramifications to becoming a dual national.

Published: 2 May 2024 16:44 CEST
Americans in France: Will my tax situation change if I get French citizenship?

Gaining French citizenship can have plenty of benefits for Americans living in France, from the right to vote in French elections to freedom of movement in the EU – as well as a more intangible sense of belonging in the country you now call home. 

However, Americans living abroad always have to contend with the United States’ system of citizenship-based taxation, which requires US nationals to report their global income to the IRS yearly, however long they have been out of the country.

This may result in making two tax declarations every year if they move to a country – like France – which requires yearly declarations from all residents.

As a result, Americans have to think about possible tax consequences before making decisions to move, invest, or perhaps take on a second nationality.

To help answer the question of whether there are special tax ramifications for French-American dual nationals living in France, The Local spoke with tax expert Jonathan Hadida from HadTax.

Hadida said: “There is really no impact. You still have yearly reporting requirements to both countries, and from the French side you will still continue to give you the benefits of the tax treaty”.

Key items, such as your US-based pension, would continue to be taxed in the US and not France regardless of whether or not you take on French nationality too.

READ MORE: Ask the expert: What Americans in France need to know about 401(k) and other pensions

Unfortunately, many of the limitations Americans in France experience would also remain in place. French investment options, such as the Assurance Vie, would still unwise for dual nationals, as the IRS sees them as PFICs (Passive Foreign Investment Company).

While the Assurance Vie is a great tool for being tax efficient for non-Americans, and can offer alternatives to the regimented, traditional French inheritance process, for Americans living in France (including those with dual nationality) it can lead to lengthy and complicated dealings with the IRS. 

“To the US tax authorities, you are still American first, second, third and fourth place. They don’t really care that you are also French,” Hadida said.

“The only real change to your tax situation would be giving up your American citizenship, but keeping your US citizenship in addition to French citizenship does not really change anything.”

What happens tax-wise if I renounce my American citizenship?

Renouncing US citizenship is not as simple as scheduling an appointment at a US embassy or consulate, paying the applicable fee, and declaring that one does not want to be American.

There are several factors to consider, and depending on your situation, in the long-run it might be more advantageous to hold onto your US citizenship to continue benefiting from certain parts of the US-France dual taxation treaty (PDF).

For others, keeping US citizenship might be onerous with its yearly reporting requirements, as well as the difficulty it can pose with putting money into French investment vehicles due to citizenship-based taxation and FATCA (US legislation that passed in 2010 to track money laundering). 

While renouncing your American citizenship undoubtedly pushes you further out of the reach of the IRS, you should consider that you might owe an exit tax, if you are deemed a ‘covered expatriate’. Usually, this is only required of high-net worth individuals (worth more than $2 million).

According to the US expat tax site 1040 Abroad, this also includes people who failed to comply with tax obligations in the five years preceding their renouncement, as well as people who had “an average annual net income tax liability exceeding a specified threshold” (as of 2022, this number was set to $178,000).

People renouncing US citizenship can also be subject to a special inheritance tax on gifts made to US citizens or residents, following their renunciation. 

READ MORE: How to renounce American citizenship in France – and why you might want to

You should also think about your US-based investments.

“You would no longer benefit from the tax treaty in the same way if you give up your US citizenship. For example, Article 24 of the treaty covers investment income, making it taxable in the US and giving you a deemed credit in France.

You would lose this benefit if you renounce, and this could make a big difference if the taxation level is lower in the US, as it often is with dividends or capital gains.

“Your IRA and pension plans will continue to be taxed in the US because this is based on where the pension is earned, not nationality, but you might have to start filing a non-resident tax return to the US after renouncing citizenship,” Hadida said.

The tax expert said that renouncing citizenship should be decided on a case by case basis.

“Every situation is different, and for some people it might not make sense to give up certain benefits from the US-France tax treaty. You should speak with a financial advisor before deciding”, he said.

READ MORE: Divorce, stress and fines: How citizenship-based taxation affects Americans in France

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