France Announces a 2027 Voluntary Disclosure Window for Undeclared Assets

I. What the announcement says, and what it does not yet say

A. A statement of intent, not yet a text

To date, the programme exists only as a statement by the Prime Minister and as press reporting. According to Les Échos, the Prime Minister's office initially favoured a window limited to three months, and the Finance Ministry argued for and obtained a longer period, with the whole of 2027 now mentioned. The government has not quantified the expected yield of the measure, which is folded into an overall anti-fraud target of one billion euros for 2027. No detail has been given on eligibility conditions, the level of reduced penalties, the scope of eligible assets or the practical filing arrangements.

The Prime Minister did, however, give two indications of the spirit of the measure. The first is the openly claimed reference to the 2013 precedent: "Bernard Cazeneuve had already done it, it is a good method". The second is the justification by strengthened detection capabilities: new legislation combined with artificial intelligence would allow the Finance Ministry's investigators to track down tax evaders far more effectively, so that they would have every interest in coming forward before being identified. In our view, this second indication is the more important for the taxpayers concerned: it announces what will follow the closing of the window.

B. The timetable and the decisive unknowns

The institutional timetable is known. The draft finance bill for 2027 will be presented on October 1, 2026; parliamentary debates will occupy the autumn; the final text will only be adopted in December, subject to the political uncertainties that have marked recent budget cycles. The exact conditions of the programme will therefore only be known with certainty at the end of the year, for a window opening during 2027.

The unknowns that will determine the real value of the programme are all outstanding. The rate of penalties applicable to disclosing taxpayers, depending on whether they are treated as "passive" evaders (heirs to assets they did not build up) or "active" evaders (those who created the assets). The treatment of the fixed fines for failing to report foreign bank accounts, life insurance policies and digital asset accounts, which apply on top of taxes and penalties. The interaction with pending procedures, in particular for taxpayers who have already received a request for information from the authority. The scope of eligible assets, notably the place of foreign structures and of the digital assets the government expressly cites. Finally, the number of years covered and the treatment of statutes of limitation.

One thing can nonetheless be asserted today: the programme will by nature be transitional and incentive-based. Its principle is to offer, for a defined period, more favourable conditions than ordinary law in exchange for a genuinely spontaneous approach. Two consequences follow. Taxpayers will need to be ready, with a complete and costed file, on the day the window opens, since the most favourable conditions of such programmes are generally reserved for approaches made before any intervention by the authority. And the closing of the window will be followed by a hardening of enforcement, as in 2017: the government says so itself.

II. The STDR precedent: what it teaches

A. The figures and conditions of the 2013 programme

The circular signed by Bernard Cazeneuve in June 2013, then Minister Delegate for the Budget, invited taxpayers holding undeclared foreign assets to regularise their position in exchange for reduced penalties, ahead of the announced tightening of anti-evasion measures and, above all, ahead of the introduction of automatic exchange of information between tax administrations. The service de traitement des déclarations rectificatives, created for that purpose, operated until its official closure at the end of 2017. It was France's equivalent of the offshore voluntary disclosure programmes run in the same decade by the United States and Italy, with a comparable rationale: clear the past before automatic exchange made concealment untenable.

The figures, recalled by Les Échos on the basis of the report the French Court of Auditors devoted to the STDR in 2017, show the scale of the phenomenon. More than 50,000 disclosure applications were filed, relating to 35 billion euros of assets of which the tax authority had no knowledge. The State collected more than nine billion euros in taxes and penalties, against an initial government expectation of one billion for the first year. Nine files in ten concerned bank accounts held abroad, mainly in Switzerland, which accounted for around 90 percent of cases.

The conditions offered were precise. The penalty for deliberate breach, whose ordinary rate was 40 percent, was reduced to 15 percent for so-called passive evaders, mainly heirs, and to 30 percent for active evaders. According to the Court of Auditors, the theoretical revenue forgone by the State through these reductions approached 1.8 billion euros across all files, a cost the auditors judged minimal given the number of files that would otherwise have escaped taxation altogether. Les Échos notes that the Prime Minister will inevitably have this precedent in mind when setting the 2027 conditions.

B. The lessons of practice: preparation made all the difference

Beyond the figures, the STDR experience taught practitioners several lessons that remain valid for 2027. The first, and most important, is that two files relating to comparable assets could produce very different outcomes depending on the quality of their preparation. The reconstruction of the banking history over the non-time-barred years, the characterisation of the origin of funds (inheritance, income already taxed, activity carried on abroad, gift), and the classification of the taxpayer as passive or active directly governed the final amount. An incomplete or poorly characterised file was expensive; a documented and reasoned file obtained the most favourable conditions the programme allowed. One of the authors of this article handled STDR disclosure files at Kramer Levin during the previous wave, and this lesson is the one that outweighs all the others.

The second lesson concerns the profile of those who came forward. The Court of Auditors found that the vast majority of disclosing taxpayers were passive evaders who had inherited the assets in question, and that the procedure had made it possible to "settle the past" by resolving the situation of heirs, without genuinely reaching organised international evasion built on sophisticated structures. The STDR served the heirs of Swiss accounts; it did not address structures. That observation illuminates what the 2027 programme will most likely target: with the stock of inherited accounts largely cleared, the government now cites holders of digital assets, and files involving foreign structures will remain ground where the window itself provides none of the expertise required.

The third lesson is one of duration. A programme announced for one year lasted more than four, because the inflow of files exceeded the administration's processing capacity and because its yield justified extension. It would nonetheless be imprudent to conclude that the 2027 window will remain open indefinitely: the conditions of a special programme can harden along the way, and the order in which files arrived mattered in 2013 as it will in 2027.

III. Disclosing without waiting for the window: why and how

A. Voluntary disclosure already exists under ordinary law

There is no need to wait for a special programme to come into compliance. Ordinary French law allows a taxpayer, at any time, to file amended returns covering the income of the non-time-barred years, together with the omitted holding declarations (foreign bank accounts, life insurance policies and digital asset accounts) and a file justifying the origin of the assets. A spontaneous approach places the taxpayer in the most favourable position for the discussion of penalties, whose modulation lies within the authority's discretion having regard to the good faith and cooperation of the taxpayer.

The firm conducts such disclosures continuously, without waiting for any window. They concern foreign bank accounts and life insurance policies, the classic case, but also more complex situations: US limited liability companies (LLCs) held by French residents and poorly understood in the light of French obligations, companies incorporated in low-tax jurisdictions, trusts with a French-resident settlor or beneficiary, and structures held in the Middle East or Asia by former expatriates. In our experience, these files are most often resolved by agreement with the tax authority, without litigation, where they have been rigorously built; each file nonetheless has its own economics, depending on the origin of the funds, the years concerned and the income generated.

B. Waiting for the window is not a neutral decision

Two risks weigh on the taxpayer who defers action in the hope of better terms in 2027. The first is being caught in the meantime. The administrations of more than a hundred jurisdictions transmit to France every year the identity of account holders, balances and income of accounts held by French residents, and the French authority uses that data to issue requests for justification under Article L. 23 C of the French Tax Procedure Code (LPF, art. L. 23 C). A taxpayer who receives such a request is no longer in a spontaneous position. They fall within a defence strategy, under a tight deadline, under the threat of the deemed taxation provided for in Article 755 of the French Tax Code (CGI, art. 755), which allows assets whose origin is not justified to be presumed to constitute wealth acquired gratuitously, taxable at the highest gift and inheritance tax rate.

The second risk is simpler: the conditions of the window are unknown, and nothing guarantees that they will be, for a given file, more favourable than those a properly conducted spontaneous disclosure obtains today. The 2013 programme offered a reduction of the penalty for deliberate breach; but many spontaneous disclosure files do not involve deliberate breach at all, and the authority takes that into account. Waiting for a framework whose conditions and opening date are unknown, for a file that could be treated favourably under ordinary law, amounts to betting against oneself.

C. The right strategy: prepare now, decide later

The preparatory work is the same whichever route is ultimately chosen. It begins with a confidential audit of the situation, protected by the lawyer's professional secrecy (the French equivalent of legal professional privilege), which is not the case for an exchange with a private banker or a consultation with an accountant. It continues with the reconstruction of the history of the assets over the non-time-barred years, the characterisation of the origin of funds, the French characterisation of any foreign structures, and the quantification of the exposure under each scenario: spontaneous disclosure under ordinary law, the special window under various assumptions as to its conditions, and detection by the authority.

This work takes several weeks for a structured file, longer where statements must be obtained from foreign institutions or a company's history reconstructed. Carrying it out now means that, on the day the window's conditions become known, the special route and the ordinary route can be compared within hours and a decision taken with full knowledge. Waiting until October 1 to start means losing the benefit of that comparison; waiting until December means risking being caught before having chosen. Voluntary disclosure is a decision taken on a costing, not on an announcement. Our practice in this area is set out on our voluntary disclosure of foreign assets page.

IV. Who is concerned in 2026

A. The classic profiles

Holders of undeclared foreign bank accounts or life insurance policies, often inherited, are the textbook STDR case and will most likely benefit from the most favourable conditions of the new programme, under the passive evader regime. To them may be added former expatriates who kept assets in their host country without declaring them on returning to France, and beneficiaries of foreign structures created by a previous generation who discover their French obligations at the time of a death in the family. For these profiles, the comparison between ordinary law and the window will be particularly relevant, since the two routes may lead to similar outcomes.

B. The new profiles

The government expressly cites holders of digital assets, considering that many are not compliant with their obligations. Capital gains on disposals of digital assets realised by individuals are taxable in France, and holding accounts on platforms established abroad is subject to a specific reporting obligation, the breach of which is punished by a fixed fine per undeclared account. This population, young, often unfamiliar with tax obligations and holding transaction histories that are complex to reconstruct, is the avowed target of the 2027 programme.

Other new profiles call for a more technical analysis than the STDR ever required. French residents holding US LLCs or other foreign entities whose French characterisation, transparent or opaque, determines the applicable tax regime. Business owners who incorporated companies in low-tax jurisdictions without measuring the consequences of French anti-avoidance rules, notably Articles 123 bis and 209 B of the French Tax Code, which attribute to French residents the income parked in lightly taxed foreign entities. Settlors and beneficiaries of trusts, subject to specific French reporting obligations (CGI, art. 1649 AB) and to a dedicated taxation regime. For these files, the French characterisation of the structures must precede any declaration: disclosing on the basis of a wrong characterisation is worse than not disclosing.

C. Persons the authority has already written to

A taxpayer who has already received a letter from the tax authority, whether a mere invitation to regularise or a request for justification under Article L. 23 C of the LPF, is no longer in a spontaneous position. They fall within a response and defence strategy, within the statutory deadline, and the 2027 window will probably not be open to them on the same terms as to spontaneous filers, if it is open to them at all. For them, the priority is the quality of the response to the authority, set out on our tax litigation page, not waiting for a future programme.