Are Dividends Taxable?

Dividends are only taxable to the extent that certain conditions are met. 'surrounded.

Are Dividends from an LLC Taxable in 2026?

Dividends from a SARL (Société À Responsabilité Limitée - Limited Liability Company) are taxable. However, it's important to know that SARLs can only distribute dividends after paying the...Corporate tax. This is the tax levied on the company's annual profits. Furthermore, The taxation of dividends from a limited liability company (SARL) varies depending on the shareholder. Here are the different methods:

Taxation for a natural person

• Imposition of the PFU or Flat Tax

Since January 2018, the tax law has changed, which means that the PFU or Blood Lance flat rate Unique or Flat tax applies to dividends. The latter has a levy rate of 30% of which 17.2% relate to social security contributions and 12,8% relates to income tax.

• Imposition of Income Tax

Dividends from SARLs will be subject to income from movable capital since they are considered as such. All of your income in your tax household will be subject totaxation at the progressive scale by installments.

However, it is possible to benefit from a A 40% tax allowance is available on your gross dividends. The conditions are that the dividends paid must be approved at a general meeting, and that your limited liability company (SARL) must be French or have its registered office in the European Union.

Taxation for the Majority Managers of the SARL

For dividends received by the managers of a SARL in France, they are taxed on a share of the profit of which:

• dividends subject to social conditions are subject to the PFU of 12.8%,
• and the other share is subject to the total PFU of 30%

Are Shareholder Dividends Taxable?

Dividends from shareholders are taxable under two regimes:

Flat Tax or PFU

It follows the same principle as for the partners of an LLC. These rates are deducted at source, ie when the company makes the payment. The payment of taxes is made directly by the company and not by the shareholder. Moreover, it is the latter who takes care of declaring the taxes within a time limit provided for by law.

The Progressive Scale by Section with 40% Reduction

If the PFU does not correspond to the shareholder, he has the right to choose the progressive levy. But the principle is always the same as for that of a SARL partner:

• a social levy at the rate of 17,2%
• a deductible CSG of 6,8% on taxable income.

For the shareholder to benefit from this tax regime, a declaration must be made directly on the income tax return.

Are Dividends Taxable on Income in 2026?

Dividends may also be taxable on income. This option is available upon request and must be entered directly on the tax return. Income taxable dividends arevantageux for low-tax shareholders thanks to a 40% tax reduction and a deductible CSG of 6,8%.

If you wish to use this regime, be aware that it is applicable to all your dividends in general. However, you cannot opt ​​for PFU taxation for certain dividends and choose IR for others.

How to Declare your Dividends?

The Ministry in charge of Finance in France has put in place systems for declaring dividends.

EFI Mode or Electronic Forms Interchange

The Department has ensured that companies and professionals can access tax procedures online so that they can declare their dividends. All you have to do is create a subscriber area with simplified access or access in expert mode. In either case, you'll still need to enter the Siren, email address, password, and contact details before moving on to further separate steps.

EDI Mode or Electronic Data Interchange

This is an online tax account for third party filers and requires an EDI ID. Once the declarant has finished subscribing to one of these modes, he will have to complete an income declaration form.

Declaration of Dividends by the Company itself

In some cases, the declaration of dividends is the responsibility of the company itself. The latter must complete a declaration before the 15th of the month following the declaration. The amounts paid to each partner must also be declared by the company before February 15 of the year of dividend distribution, via a specific form. The EDF dividend is, for example, often distributed in the month of May.

Declaration of Dividends by the Broker

In the event that your stock market account is opened with a French broker, the latter takes care of providing the information to the tax authorities, directly while sending you. At the same time, a summary of the information given to the tax authorities.

How are Distributed Dividends Taxed?

Dividends distributed are taxed according to the A flat tax rate of 30%. This principle is similar to the taxation for shareholders or partners of a limited liability company (SARL) already mentioned above.

However, the beneficiary of the dividends has the choice of opting for theIR or Income tax is levied at progressive rates. This allows for a 40% allowance, plus the deduction of the 6,8% CSG (General Social Contribution) as explained above.

Exemption from the PFU Levy

A deposit exemption of 12,8% is possible provided that the tax income of year N-2,

• For a person is less than 50.000 €.
• For a married or civil union couple subject to joint taxation, the amounts are less than 75.000 €.

The request for this option must be made no later than November 30 of the year preceding the payment. It is presented by the beneficiary to the paying institution in the form of a sworn statement.

Taxation of a Legal Person

The impositions do not necessarily relate to the associate, but can also relate to the company as a legal person. In this case, we are talking aboutCorporate tax. This is a tax levied on the annual profit of companies operating in France.

• A rate of 28% or a reduced rate of 15%

In cases where the partners or shareholders are companies, the dividends include its taxable profit taxed at 28% or 15% if the company benefits from the reduced rate.

• The parent and daughter regime for a 95% dividend exemption

The company receiving the dividend can take advantage of the dividend exemption. HAS 95% if it holds at least 5% of the capital of the parent company and provided that it has held the equity securities in that company for a minimum of 2 years.

However, this condition may be relaxed for companies controlled by a non-profit organization.

How not to pay tax on dividends in 2026?

It is impossible not to pay tax on dividends. The possibility is to make sure to obtain relief that the beneficiary of the dividends can afford. Moreover, the condition to be met is to be a single person with a taxable income lower than €50.000. However, for a married or civil union couple subject to joint taxation, less than €75.000. The application for this exemption must be renewed every year, no later than November 30th.

Who pays the Dividend Tax?

Dividend tax can be paid by:

• Company
• The broker (case valid for a stock broker in France).
• The beneficiary himself, he can be a shareholder or a physical or moral partner.

How are Dividends Taxed?

Dividends may be taxed as follows:

• a PFU or Unique Flat Tax, also called Flat Tax
• an IR or Income Tax
• an IS or Company Tax

Another point that we have not yet touched on concerns another way in which dividends can be taxed. These are taxes according to the tax framework of the investment in two cases:

• case of PEA and life insurance 
• case of the securities account.

Case of PEA and life insurance

In this first case, the dividends paid by companies are neither taxed nor taxed. Except when you make withdrawals from your account.

For PEAs, withdrawals are subject to social security contributions (CSG) at the current rate of 17,2% for 2025. It should be noted that these withdrawals are in no way income taxes.

For life insurance, a progressive reduction may be applied. While the amounts of income tax are set according to several criteria.

Case of the Securities Account

Unlike the first case, the payment of dividends in a securities account is subject to social security contributions and income tax. A positive point for this second case is that the taxes as well as the taxes are levied starting from the gross amount of the dividends paid by the company.

Where to put Dividends on the Tax Form?

To put the dividends on the tax form, here are the steps to follow:

• In the tax return, go to the line Income from shares and units,
• Fill in the case 2DC with the amount of dividends without deducting any allowance.
• This amount should be reported in the box 2BH in order to calculate the CSG deductible from income.
• Check and correct if necessary the amount in the case 2CK.
• For thetaxation according to the progressive tax scale by brackets, check the boxbase 2OP

For legal persons wishing to benefit from an exemption from dividends:

• They must indicate on form 2058-A of the tax return (section II deduction-line XA), the net amount of dividends,
•  and Table 2058-A of the tax return (section II deduction-box 2A) the amount of the 5% share.

How not to pay tax on dividends?

You can refuse the flat-tax and request that your dividends be taxed in the income tax declaration. The calculation then becomes much more complex. You will still be subject to social security contributions of 17.2%. However, it will not be 12.8% income tax.

Who pays tax on dividends?

Dividends received by a taxpayer are automatically taxed at the single flat-rate levy of 30%, made up of social security contributions at the rate of 17,20% and income tax at the rate of 12,80%. This deduction is made by the paying establishment, which transfers it directly to the State.

⏳ When are dividends taxed?

The first step is the payment of dividends: they are subject to a double withholding tax at source, which is fiscal and social, at a rate of 30% ("flat tax"). The second step occurs after the income declaration, which will take place in spring 2025 for dividends received in 2025.

❓ How are dividends taxed?

Dividends paid to managers and partners are subject to a one-time flat-rate deduction (PFU) of 30% composed of: 12,8% for income tax, 17,20% for social security contributions .

Are Dividends Taxable?