Works of art, gold, collector’s watches, NFTs or classic cars: these so-called atypical assets do not always generate income, but their ownership, sale or transfer raises complex tax issues between France and Switzerland. In the case of cross-border non-property assets, it is essential to anticipate reporting obligations, applicable tax regimes and risks of requalification.
Assets subject to specific tax regimes
Works of art, precious metals, collector’s watches, racehorses, digital objects (NFT) or exceptional vehicles: these valuable movable assets raise sensitive tax issues, particularly for taxpayers residing between France and Switzerland. Although they do not generate regular income, their ownership, transfer or sale can entail substantial tax liabilities.
In France, certain categories are excluded from the real estate wealth tax (IFI), notably works of art, provided they are not held through a structure with a preponderance of real estate assets. Conversely, precious metals, jewelry, collectors’ items and old vehicles may be taxed on disposal, or as part of certain wealth management schemes.
In Switzerland, wealth tax is cantonal. Valuables are subject to compulsory declaration, and are valued according to their official estimate or market value by certain cantons. Failure to declare may result in tax adjustments, particularly in the event of transfer or inheritance.
Sale, inheritance, gift: the main cases of taxation
The applicable tax regime varies according to the nature of the atypical asset and the transaction involved. In France, the sale of a movable asset (painting, jewel, investment gold, collector’s vehicle, etc.) may give rise to :
- a flat-rate tax on precious objects (6% + CRDS);
- or, as an option, to the capital gains tax on the sale of movable property, with a deduction for the length of time the property has been held.
To benefit from the capital gains regime, the taxpayer must be able to prove the origin of the asset, its acquisition date and its initial value. Failing this, flat-rate taxation applies automatically.
In Switzerland, capital gains from the sale of movable property are in principle tax-exempt if they fall within the scope of private management. However, an organized collection, a high frequency of transactions or commercial use may lead to the sale being reclassified as a professional activity, with subsequent taxation.
In terms of inheritance, France applies a progressive scale depending on the family relationship, while Switzerland applies cantonal inheritance taxes. A work of art passed on to an heir resident in France but physically held in Switzerland may therefore be subject to double taxation in the absence of tax coordination.
Declaration and valuation: a compliance issue
Taxpayers domiciled in France are obliged to declare certain assets located abroad, including collectibles held in a safe or a residence in Switzerland. This obligation does not depend on the generation of income, but on the ownership of the asset itself.
The key issue is the valuation of these assets. In the event of an inspection, the French or Swiss authorities may contest the declared value, particularly if it differs from the prices charged at public sales. It is therefore advisable to keep purchase invoices, certificates of authenticity and expert appraisals, and to periodically update the value of the most significant items.
Certain assets can also have a tax impact. For example, a classic car held via a patrimonial company may be included in the IFI tax base, or be considered a business asset if it is used for economic purposes (events, rental, paid exhibition, etc.).
Special case of works of art: taxation, IFI and VAT
Works of art benefit from favorable tax treatment in several situations:
- Exempt from IFI in France, provided they are held directly (and not via an SCI or property holding company).
- Exemption from VAT on resale if the property has been held for more than two years and sold as part of private management.
- No capital gains tax if the conditions for exemption are met (in particular, value less than €5,000 or long holding period).
On the other hand, an art dealer, an active collector or someone who sells frequently may be considered a professional, and the relevant commercial and tax rules will apply. It is therefore essential to qualify the status of the owner, and to anticipate the tax consequences according to the degree of organization of the collection.
Support for your valuables
BERGEOT PAOLI Associés assists individuals and families with diversified assets, including works of art, precious metals, digital objects (NFT), rare collections and prestige vehicles. We analyze the tax situation applicable to each type of asset, taking into account your place of residence, the location of the assets, the tax treaties in force and your transfer or sale plans.
Our support is aimed at anticipating the risks of requalification, securing declarations and optimizing the holding of your atypical assets within a controlled Franco-Swiss tax framework.
For a comprehensive and rigorous overview of the taxation of your non-traditional investments and assets, see our page dedicated to the taxation of investments and real estate.