Telecommuting to my U.S. Company


My wife and I are U.S. citizens living in the U.S. who want to move to France, probably permanently, as soon as possible (after the borders reopen and the visa office resumes issuing visas). We’ve been learning French for 5 years, have spent about 5 months total in France, and hold a French checking account.

I’m currently a telecommuting employee of a U.S. company who pays directly into my U.S. bank account. I also have a couple of U.S. companies (LLCs), which I can run from anywhere, and once they become profitable enough, I might quit my day job. My wife doesn’t work.

I’m thinking that our best option that could lead to permanent French residency is to file one of my companies with the CNFE, as a foreign business without a presence in France, and make myself an employee, and pay myself the minimum required. Does this approach work if my LLC has no business reason to relocate me to France?

Is it okay if I have 2 identities, the American who’s working for a U.S. company and running U.S. companies, and also the expat in France who’s employed by a U.S. company (that is mine)? I think I’ll need to declare and pay taxes on worldwide income to the U.S. (minus the taxes I pay to France per their tax treaty), and declare taxes on worldwide income to France but only pay tax on the salary I receive from my U.S. company.

Of course, any option would need to provide for my wife’s visa as well.

Any guidance would be appreciated.

Have a look at this:

What you want to do is complex as the US and France are the two countries with the most strict labour and finance laws. You need professional advice on this one.

As Jane says you must get professional advice from a consultant who is qualified to give it.
At first sight your plan would appear to conflict with the French fiscal, social security and labour codes on perhaps half a dozen points but an expert will be able to explain the points of conflict to you and hopefully suggest solutions.
However the first question that springs to mind is authorisation to work. You say

but unless a person has the right to work in France you cannot make them an employee. As a US citizen I imagine you do not have the automatic right to work in France. Normally when a company wishes to apply for a work permit for a person they wish to employ, the application is processed by the labour directorate but since in this case you would in effect be employing yourself, the labour directorate may consider it to be an immigration issue. I do not know whether you would obtain a visa with the right to work, on this basis. If you cannot get permission to work in France you will be wasting money paying a consultant for advice.

The second issue that occurs to me is that assuming you could do this, would you not be liable for social charges on all the foreign income you declare in France? (Do not confuse social taxes with social security contributions or payroll taxes as I believe they are called in the US. Social charges are levied on most types of income alongside income tax, and dual taxation treaties often do not seem to eliminate them.) This may not be a deal breaker but you should be aware before you start spending money on advice.

You should definitely get professional advice on this topic, from both a tax attorney and an immigration lawyer as the topics are different, although - often unhelpfully! - intertwined.
One interesting facet of the US - French tax treaty of 1994 is that US-based income for US citizens legally resident in France is not taxed by France. My understanding is that if all your income is derived from / in the US you will not pay French taxes on it. However this will likely not help with making the case for the immigration status you seek.
But it does seem a pleasant counterpoint to the US practice (along with North Korea, Libya, The Philippines, and Eritrea) of taxing all citizens global income regardless of place of residence.

Re the French social charges I mentioned, this appears to be the latest ruling and unless things change it looks like good news for US citizens