In the context of french law and tax regulations, if a lender decides to lend more than €5000 with a 0% interest rate to a borrower, would the lender and/or the borrower have to pay taxes on this specific loan?

In the context of this question, we assume that the lender and the borrower:

  • are both individuals, and are 18+ years old
  • are both french citizen, living in France, and paying their taxes in France
  • are neither: married, members of the same family, or united by a PACS (Pacte Civil de Solidarité)

What I know:

According to french law and tax regulations, one has to report loans between individuals when the amount is greater than €5000.

Source: 2020-09-27 - Code général des impôts, Annexe 4, Article 23L

French law also specifies that interests received under the loan agreement are taxed at 30%, following the rules of the PFU (Prélèvement Forfaitaire Unique).

But what if the interest rate is 0%? Which taxes, if any, would have to be paid in this scenario?


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