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Source of Funds local deviations for France

Mason Friis-Burden
Updated

The article below discusses various types of sources of funds specific to the region, along with the local documentation needed.

Income from employment 

As an alternative to the general documents that can be collected to verify the income from employment, in France it can be collected the Latest tax notice + the latest pay slip. 

The tax notice is issued by the tax administration (DGFiP) and is accessible via the official portal impots.gouv.fr.  

If the client decides to verify their income with bank statement (last 3 months) + additional documentary evidence, this additional evidence should be an Employer Certificate (a document issued by the employer’s HR department). 

Dividends 

If the dividends come from a listed company request all the followings: 

  • Transaction notice issued by the financial institution confirming the payment of dividends. 
  • Bank statement indicating the payment of dividends. 
  • Tax notice id mandatory if dividends were received in the previous year (N-1). 

If the dividends come from unlisted companies (received more than a year before or during the current year), request all the followings: 

  • Minutes from the general meeting authorizing the dividend distribution. 
  • Official company letter specifying the dividend amount and beneficiary. 
  • Bank statement showing dividend payment. 
  • Tax notice is mandatory if dividends were received in the previous year (N-1). 

The 2042-C declaration alone is insufficient – formal proof of declaration such as certified attestation, proof of IFU filing, or bank statement is required. 

Income from retirement 

In France, retirement income often consists of multiple schemes (basic, supplementary). A pension statement or an official record from a pension fund (such as CNAV, AGIRC-ARRCO) provides more reliable evidence than a simple declaration to understand the income structure. 

All the following documents are required: 

  • Pension statement from the basic and/or complementary scheme (CNAV, AGIRC-ARRCO, MSA) specifying the retirement date and the last employer. 
  • Simple statement of monthly payments. 
  • If retired since N-1 or earlier, the last tax notice. 

Contextual questions to be asked: 

  • The main employer and the position held, 
  • The approximate length of professional career before retirement. 

Inheritance 

The documentation requirements can be based on the inheritance value. 

For inheritance below 5k EUR (spouse, civil partner, child): 

  • Certificate of inheritance issued by the town hall or a notary (no mandatory declaration) OR 
  • Statement signed by all heirs. 

For inheritance above 5k EUR (spouse, civil partner, child): 

  • Notarial deed. 

For inheritance above 50k EUR or for other heirs (siblings, nephews, cousins) from 3k EUR: 

  • Succession declaration (form 2705-SD). A succession declaration is a tax obligation when the gross estate exceeds 50k EUR (for direct heirs). Below this threshold, a certificate of inheritance is sufficient.  

For all cases: 

  • Bank statement or payment evidence showing receipt of funds. 

Freelancer 

We require all the following documents: 

  • SIRENE directory registration certificate (this proves legal existence). 
  • Latest URSSAF declaration. 
  • Latest tax notice if the client has been active for more than one year. 

If the client has been active for less than one year: 

  • Long-term contracts + invoices + 3-month bank statements evidencing payments. 
  • Latest URSSAF certificate of turnover (if available). 

Contextual questions to be asked: 

  • Business description of services offered. 
  • Client base and geographical presence. 
  • Activity start date. 

Gift/donations 

The documentation requirements can be based on the gift/donation value.

 

For gifts/donations below 3k EUR (customary gifts):

  • Declaration from the client explaining the relationship with the donor, reason for donation/gift, amount and date. The declaration must be signed by the grantor too.
  • Bank statement showing receipt of funds.

 

For manual gift under 15k EUR:

  • Form 2734 with proof of submission to the tax office (validated by stamp).
  • Bank statement showing receipt of funds.

 

For manual gifts above 15k EUR:

  • Form 2735 with proof of submission to the tax office (validated by stamp).
  • Bank statement showing receipt of funds.

 

Donations (by notarial deed): 

  • Notarial deed of donation (authentic copy).
  • Bank statement showing credit to the client’s account from the notary’s office. 

Royalties 

The following documentation is required: 

  • Contract (copyright/patent/license agreement). 
  • Tax declaration: Form 2035 if > 32,900 EUR + Tax notice if royalties were received in the previous year (N-1). 
  • Bank statement showing receipt of the funds. 

Contextual questions to be asked: 

  • Source of royalties (copyright/patent/license agreement). 
  • Annual value of payments. 
  • Collecting organization involvement (SACD/SACEM if applicable). 

Company sale 

We require one of the following: 

  • Signed transfer deed or memorandum of understanding. 
  • Form 2759-SD (transfer of social rights) validated by stamp only if not recorded by a notarized deed + minutes of the general meeting authorizing the transfer. 

In all cases, we also require a bank statement showing the transaction. 

Property sale 

We require the following documentation: 

  • Notarized sale deed (obligatory under art. 1583 Civil Code). This must contain the sale amount. 
  • Bank statement showing net proceeds. Under French law, every real estate sale must be concluded with a notarial deed (art. 1583 of the Civil Code). There is no alternative to this requirement. 
  • Tax notice on which the proceeds of the sale are declared if the transaction is more than one year old. 

Trading profits 

We require all the following documents: 

  • Bank statement showing the fund transfer. 
  • Detailed portfolio statements covering the trading period. 

If the profits were received in the previous year: 

  • IFU (Form 2561) OR tax notice. 
  • Bank statement showing the fund transfer. 

Foreign accounts (if applicable): 

  • Form 3916 declaration 

Contextual questions to be asked: 

  • Trading start date and initial portfolio amount. 
  • Portfolio accumulation method. 
  • Source of initial investment funds. 

Rental income 

Documentation requirements are based on the rental regime. 

Individual person: 

  • Latest tax notice showing rental income 

SCI (Real Estate Investment Company): 

  • Latest tax notice showing rental income + Form 2072-C (SCI subject to income tax). 
  • Latest tax notice showing rental income + Form 2065 (SCI subject to corporate tax). 

If the client is unable to provide a tax notice (e.g. recent investment): 

  • Tenancy agreement + recent rent receipts. 

Supporting documents: 

  • Bank statements showing the regular receipt of rental income. 

Gambling/betting 

We require all the following documents: 

  • Official certificate from gaming organization (lottery/casino/betting shop) 
  • Bank statement showing fund deposit with company name 

For repeated or large winnings: enhanced due diligence to examine professional nature (initial Source of Funds).  

Contextual questions to be asked: 

  • Gambling frequency (regular vs one-time), 
  • Online vs offline betting preference, 
  • Estimated annual income from gambling, 
  • Duration of gambling activity. 

Loans 

Loans from family members is not an acceptable SOF in France. Therefore, the analyst should always trace the original source that made the loan possible. 

For bank loans, we should assess the client’s repayment capacity, not the loan itself. 

We must collect: 

  • Written loan agreement,
  • Transfer documentation showing loan amount,
  • Plausibility assessment of the lender’s SOW and lending capacity (if the lender is not a bank or similar financial institution),
  • Economic justification for the loan,

Insurance payments 

We require the official liquidation/payment certificate from the insurer, containing: 

  • Amount paid to the beneficiary, 
  • Contract nature and terms, 
  • Beneficiary identity, 
  • Payment date and account IBAN. 

Sale/trade of crypto assets 

To justify the source of funds, the client must provide the following elements, organized into three control points:

Initial investment: 

  • Documentation providing evidence of the source of funds for the initial investment (e.g. payslip, gift deed). 
  • Bank statement showing the transfer to the exchange platform. 

Platforms used (only regulated platforms can be used) and Tax Compliance: 

  • Client’s declaration of honor listing the platforms used. 
  • Declaration if capital gains (Form 2086 with proof of filing). 
  • Declaration of foreign accounts, if applicable (Form 3916). 
  • Latest tax notice. 

Traceability of flows: 

  • Complete export of transaction history from the platform. 

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