France Targets Unreported Self-Custody Crypto Holdings Over €100K With Proposed €10K Fines

The finance committee of France has given its approval for the proposal on self-custody crypto holdings of value at least €100,000. The proposal would impose fines up to €10,000 on those who don’t report qualifying wallets.

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France’s Crypto Reporting Proposal Covers Private Wallets

France’s finance committee has backed amendment I-CF821, proposing new reporting requirements for self-custody crypto wallets. The measure was introduced in the French budget examination in 2027 by Charles de Courson, Jean-Pierre Bataille and Michel Castellani.

Under the official amendment, residents and entities would report qualifying wallets they control without custodial providers. The proposed amount is up to €100,000 based on the assets valued on 31st December of every year.

The text would modify Article 1649 bis C of the tax code in France, which would expand current disclosure requirements. Under the provision, taxpayers will need to provide covered account information with their income or business tax returns.

Under current regulations, individuals who are eligible must report certain foreign-based crypto wallet providers. France’s financial regulator, in July, finalised the migration to comply with MiCA for crypto service providers. The earlier coverage of Binance’s French licensing problems described restrictions on exchange services following that deadline.

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Proposed Penalties Reach €10K For Missing Declarations

To ensure reporting, the amendment would expand Article 1729 C ter to cover qualifying self-hosted wallets. That provision in French tax law is limited to a maximum penalty of €10,000. For a first violation within the current and previous three calendar years, the maximum falls to €5,000.

The sponsors referred to the results of an inquiry into the subject of taxation of high income households and large fortunes conducted by the Parliament. In their explanatory note, they stated that they received €3.5 billion for realised gains from cryptocurrencies in 2021.

For the same year, the note cited just €400 million in crypto assets declared to tax authorities. The figures refer to realised gains and declared holdings, which the sponsors gave as separate items. Their note cites recommendation nine of the parliamentary inquiry into tax reporting among wealthy households.

Existing EU Rules Require Crypto Transaction Reports

France’s Article 1649 bis C covers certain foreign provider accounts and specified nonfungible assets held abroad. The draft legislation would extend to self-custody holdings without relying on any foreign service provider.

Additionally, the DAC8 mandates that crypto providers collect data on reportable transactions beginning for the entire European Union. The report on Spain’s DAC8 preparation included the preparations of member states in relation to exchange reporting.

Providers will have to submit the first year’s data in 2027, according to the European Commission. An implementing rule in France mandates the collection of the covered user identifiers and transaction information for such reporting.

According to the Commission’s timeline, EU tax authorities now have until September 30, 2027, to exchange their initial reports.