Moving to Switzerland: The 7 Mistakes That Trigger a French Tax Audit
By Eve d'Onorio di Meo — Tax Lawyer, Marseille and Geneva Bars
Every year, hundreds of French taxpayers settled in Switzerland are audited by the French tax authorities (DGFiP). In the vast majority of cases, these audits result in significant — sometimes ruinous — tax reassessments, because the expatriation was prepared too lightly. Here are the seven most frequent mistakes, documented by the firm's practice.
Mistake No. 1 — Keeping your French home without renting it out
This is the classic mistake. The taxpayer moves to Switzerland but keeps his flat in France "just in case" — empty or lent to family. The French authorities then consider that he has a permanent home in France within the meaning of Article 4 of the Franco-Swiss treaty of 9 September 1966.
A flat kept empty — even without staying there — is enough to constitute a permanent home. It must be rented out or sold for the tie to be truly severed.
Case study — Sophie, a wealth management adviser, moves to Lausanne in 2021 and keeps her Paris flat unrented. In 2023 the DGFiP notes that she has kept the property and stays regularly in Paris. Reassessment: 3 years of worldwide income re-taxed in France. Penalty: 40%. Total amount: €210,000.
――――――――――――――――――――
Mistake No. 2 — Keeping your main professional activity in France
Article 4B of the CGI and the Franco-Swiss treaty converge: if the main professional activity or the dominant income remains located in France, Swiss residence is fictitious. Effectively running a French company from Switzerland, receiving almost all of your remuneration from a French company, or concentrating your active investments there: these configurations systematically expose you to a reassessment.
――――――――――――――――――――
Mistake No. 3 — Leaving the family home in France
If the spouse and children remain in France — children at school in Paris, spouse working in France — the Franco-Swiss treaty attributes residence to the State of the family home. This criterion prevails over the taxpayer's own physical presence in Switzerland. Many executives who "expatriate" without their family see their Swiss residence recharacterised within a year of the audit.
――――――――――――――――――――
Mistake No. 4 — Failing to document your physical presence in Switzerland
A tax audit of an expatriation is above all an examination of the facts. The authorities systematically request: bank card statements (location of spending), phone records (geolocation of calls), access badge history, travel tickets, restaurant bills. If these items reveal a predominant presence in France, Swiss residence is recharacterised.
Point of attention — The Franco-Swiss treaty sets no automatic 183-day threshold. What counts is habitual and predominant presence. An expatriate present 160 days in France may have his Swiss residence upheld if the facts are consistent and documented.
――――――――――――――――――――
Mistake No. 5 — Forgetting your residual French filing obligations
Even as a valid Swiss resident, you retain residual French tax obligations: French-source rental income, capital gains on French real estate, dividends from French companies. This income must be reported on form 2042-NR. Failure to file is penalised regardless of any fraud: minimum fine of €1,500 per missing form.
――――――――――――――――――――
Mistake No. 6 — Ignoring or misreporting the exit tax
Article 167 bis of the CGI provides for the taxation of latent capital gains on significant shareholdings upon transfer of residence. Form 2074-ETD must be attached to the income tax return for the year of departure. Omission exposes you to a 40% penalty on the reassessed tax.
Important: for a move to Switzerland (outside the EU/EEA), deferral of payment of the exit tax is not automatic. It is granted at the taxpayer's express request and is conditional on providing guarantees to the French Treasury (mortgage, pledge of shares, bank guarantee), unless the authorities grant a waiver.
Case study — Marc moves to Switzerland in 2022 without declaring his exit tax (latent gain: €1.8M on his SAS). Discovered by the DGFiP in 2024. Reassessment: €270,000 + interest + 40% penalty. Total: €432,000.
――――――――――――――――――――
Mistake No. 7 — Believing the risk ends after departure
The ordinary reassessment period is 3 years. Where fraud is suspected, it rises to 6 years. For undeclared foreign assets: 10 years. A taxpayer who left in 2022 remains auditable until at least 2025 — and until 2028 if the DGFiP suspects manoeuvres. Documentation of Swiss residence must be rigorously maintained throughout the expatriation period.
――――――――――――――――――――
FAQ — Frequently asked questions
How does the DGFiP know I still live in France when I declared a move to Switzerland?
Since 2018, Swiss banks have automatically transmitted your account data to the DGFiP (CRS exchange). The authorities cross-check this data with your card payments in France, your phone records and information from digital platforms. Detection is almost automatic for frequent stays in France.
What is the average reassessment for a fictitious expatriation to Switzerland?
Based on the cases handled by the firm, the average reassessment is between €150,000 and €600,000 (tax + penalties + interest) for a taxpayer with €200,000 to €500,000 of annual income. For cases including an undeclared exit tax, the amount can exceed several million euros.
Can a poorly prepared expatriation be regularised before an audit?
Yes, in some cases. Voluntary regularisation (amended returns) can reduce penalties from 40% to 10% and avoid criminal risk. The window closes upon receipt of an audit notice. The firm assesses each situation to determine whether and how to regularise.
Do the tax authorities really use social media to prove fictitious residence?
Yes. The DGFiP may rely on the geolocation of Instagram, LinkedIn and Facebook posts to build a body of evidence of presence in France. These items are added to bank and phone data to make up a reassessment file.
Until when can the DGFiP audit my move to Switzerland?
The ordinary period is 3 years. Where fraud is suspected: 6 years. For undeclared foreign assets: 10 years. Switzerland has fully participated in CRS automatic exchange since 2018: bank data is transmitted annually to the DGFiP.
――――――――――――――――――――
Contact us
Reply within 48 hours for an audit of your file.
📞 +41 22 320 42 42
D'Onorio di Meo Avocats — Geneva • Marseille
Comments