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Banking On It

Volume XIII, Issue 34

When you purchase a property in France, you will need a French bank account. If you take a mortgage, the lender will require that the monthly payments be automatically deducted from your account. If you contract with EDF or GDF for your utilities (the electricity and gas companies), you will not be able to open an account without that French bank account. The bottom line is that it is essential.

A bank account in France has never been easy to open and has become increasingly difficult, thanks to the FATCA (Foreign Account Tax Compliance Act). This is largely because the regulations imposed on foreign banks by the U.S. government make it expensive and difficult for those banks and therefore American clients are undesirable. If you are unfamiliar with FATCA, get familiar!

“U.S. individual taxpayers must report information about certain foreign financial accounts and offshore assets on Form 8938 and attach it to their income tax return, if the total asset value exceeds the appropriate reporting threshold. Form 8938 reporting is in addition to FBAR reporting.” (irs.gov) The threshold is “the aggregate value of all foreign financial accounts exceeding $10,000 at any time during the calendar year.”

Don’t be frightened by this. It doesn’t mean you pay tax on the amounts held in your foreign bank accounts. It’s just that the IRS wants to know about them and ensure that your income was reported for tax purposes prior to having transferred it into those accounts. It’s better to report every penny than not, as the fine for those who fail to report these accounts “may be subject to a civil penalty not to exceed $10,000 per violation for non-willful violations that are not due to reasonable cause. For willful violations, the penalty may be the greater of $100,000 or 50% of the balance in the account at the time of the violation, for each violation.” Now, that’s something of which to be frightened!

To open a French bank account with a commercial bank in France, it must be done IN PERSON. There are almost no banks willing to do this long distance without seeing the physical person and backing up the account with a stack of documentation.

This is certainly different than in the U.S. bank where you can open an online account in moments, or walk into any branch of just about any bank and sit down in front of a bank officer waiting with baited breath to open your account in a matter of minutes — with as much money as you’re willing to deposit. The paperwork is minimal and you are sure to walk out with an account, starter checks and a debit card or credit card attached to the account.

In France, to open an account you must phone or walk in to the bank of your choice and ask for an appointment with an agent for sometime in the future. Then, prepare yourself.

To choose the best bank for you may depend more on location of the branches than anything else, as they are all equally disappointing from a service point of view (my opinion) — compared to what we as Americans experience Stateside. Remember that the idea of ‘money’ is still a ‘dirty word’ in France. An account can be opened with no money at all and the banks care more about you as a customer of all of its services than the amount of money you will deposit in their bank. Money is not what ‘speaks’ here! The relationship you have with the bank is what counts.

If you are purchasing a property, or rent one long term, then I recommend you develop a relationship with a bank branch near your residence and get to know the people who work in that branch. They will treat you best of all.

There are more than 400 banks in France from which you have to choose, but the largest groups with the most branches are:

* BNP Paribas
* Crédit Agricole
* Société Générale
* Crédit du Nord
* Caisse d’Epargne
* Credit Lyonnais (LCL)
* HSBC France
* La Banque Postale
* CIC Bank/Crédit Mutuel
* BRED Bank
* Banque Populaire

A foreigner may open a non-resident account (compte non-résident), but not all banks are able to make this distinction. Non-resident accounts often carry with them a minimum amount held on deposit, and often that minimum amount isn’t very nominal! It varies with each bank.

The documents you may need to open the account are:

* Proof of identity (a valid passport or ID card)
* Proof of residence in France if a resident account (Carte de séjour or other visa)
* Proof of a French address: a utility bill, rental agreement or property deeds
* Proof of earnings or status: Contract of employment/proof of earnings/proof of status
* Reference: from other banks where accounts are held (usually only required for loans and overdrafts)
* In some cases, a birth certificate

Expect the fees for the account to be expensive and seem exorbitant considering the bank has your money! Fees may include, but not exclusive to:

* Package service
* Check books
* Bankers draft
* Credit/debit Card
* Cash withdrawals outside of the branch
* Internet access and/or transactions
* Statements
* Stopping a check/card/direct debit
* Foreign currency transactions
* Direct debits
* Overdrawn Account

When researching for the bank that makes the most sense for you, consider these fees, but also consider your ability to bank online (as a non-resident this may be most important) as well as build that relationship with your bank agent.

If you are just in the onset of finding your perfect property in France, make opening a bank account a high priority so that you won’t miss the opportunity to open the account in person and perhaps delay your final transactions.

Recommended Financial Resources for Expats:

French Property LoanFrench Property Loan
Mortgages for Non-Residents
Mortgage Manager John Rule
[email protected]

 

Dunhill FinancialBrian Dunhill
Dunhill International Financial Planners
+32 (0)2 644 66 25
[email protected]
Avenue des Saisons 110
1050 Brussels, Belgium

MIR financial servicesCarl Mir
MIR Financial Services for Expats
Mir Enterprises US, LLC
[email protected]
Mobile-Belgium: +32 0494 27 97 63
Business-Belgium: +32 (0)2 644 6625
Business-U.S.: +1 (919) 960-1499
Skype: Mir.Enterprises.US

Currency Exchange Services:

MoneyCorp currency exchangeMoneycorp
Contact: Carole Jaskarzec
Tel: +44 207 589 3000
Fax: +44 207 235 4250
[email protected]

World First currerncy exchangeWorld First
Contact: Russell Gous
Tel: +44 207 095 0747
[email protected]

 

 

usforex currency exchangeUS Forex
Contact: Shaun Dash
Tel: +44 207 614 4100
[email protected]

A bientôt ,

 Adrian Leeds, French Property InsiderAdrian Leeds

The Adrian Leeds Group

Respond to Adrian: [email protected]

 

 

P.S. Did you know that many Parler Paris Apartments have been featured on House Hunters International? You can stay in one of the gorgeous apartments appearing in this popular show. Visit Parler Paris Apartments  and look for the House Hunters International logo today!

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