France
The flat tax (PFU) covers capital gains, dividends, and interest at a flat 31.4 percent, slightly raised since early 2026. Alternatively, the progressive rate can be chosen if it's cheaper.
Since 2018, most investment income in France has been subject to a single flat rate, the so-called flat tax or PFU. Since January 1, 2026, it's stood at 31.4 percent, made up of 12.8 percent income tax and 18.6 percent social contributions.
This flat rate applies to capital gains on stocks, bonds, fund units, and ETFs in an ordinary brokerage account, to dividends, to interest, and to crypto gains when converted into a legal currency.
Anyone falling into a low tax bracket by income can opt for the progressive rate instead. That's worthwhile especially at very low total income, since the regular entry-level tax rate can sit below 12.8 percent.
Two special cases worth knowing. The tax-advantaged PEA equity savings account has its own, cheaper rules after a holding period. And the Assurance-vie life insurance wrapper is exempt from the 2026 increase and stays at 30 percent.
The Prélèvement Forfaitaire Unique was introduced in 2018 and uniformly covers dividends, interest, capital gains on movable securities, and crypto gains. The increase from 30 to 31.4 percent on January 1, 2026 comes exclusively from a rise in the social-contributions component under the 2026 Social Security Financing Act; the 12.8 percent income tax share stayed unchanged.
The choice between the flat rate and the progressive rate is binding for all investment income earned that year and can't be made selectively by income type. The decision pays off mathematically mostly for taxpayers whose marginal rate under the general schedule sits below 12.8 percent, typically at very low taxable income.
Losses on crypto gains can be offset against similar future gains for ten years. Real estate gains fall under a separate regime with staggered allowances by holding period, not to be confused with the flat tax on financial assets.
Summary
- 31.4 percent flat tax on capital gains, dividends, and interest since 2026.
- At low income, the progressive rate can be cheaper.
- PEA and Assurance-vie follow their own, cheaper rules.
Did you get it?
What makes up France's 31.4 percent flat tax?
12.8 percent income tax and 18.6 percent social contributions.
Why did the rate rise from 30 to 31.4 percent in 2026?
Because of a rise in the social-contributions component; the income tax share stayed the same.
When does the progressive rate pay off over the flat rate?
When your personal marginal rate sits below 12.8 percent, usually at very low income.
Sources and further reading
- Loi de financement de la Sécurité sociale pour 2026, raising social contributions on investment income effective 1 January 2026
- Service-Public.fr, official explanation of the Prélèvement Forfaitaire Unique (PFU) View source ↗
Related
- ItalyTaxes by Country
- SpainTaxes by Country
- SwitzerlandTaxes by Country