AGENCE FRANCE TRESOR is tasked with managing the government debt and cash positions under the most secure conditions in the interest of the taxpayer.
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The OAT market for private individuals

In partnership with Euronext and the primary dealers, AFT has set up a genuine secondary market that enables private individuals to buy and sell OATs as easily as professional investors.

Anyone can access the OAT market. OATs offer private individuals numerous advantages, including a regular income, protection against inflation, a source of capital to supplement their pension or finance a project in the future, or as a means of diversifying their wealth portfolio.

An organised secondary market
The Government took steps to modernise the OAT market in 2005 to ensure that it met private individuals’ needs:
• market liquidity: OATs are highly liquid. Financial institutions acting as market makers ensure the market, overseen by Euronext, remains liquid. This means that private individuals will always find a price at which they are willing to buy or sell their OATs;
• placing orders: orders can be placed through traditional or online financial intermediaries.

Taxation of OATs
Since January 1, 2013, interest on OATs and government bonds received by individuals domiciled in France for tax purposes has been, with some exceptions (see below), liable to progressive income tax in the year following its receipt after being subject, in the year of receipt, to a withholding tax (“advance payment”) of 24% (plus social contributions on investment income). This advance payment is then deducted from the tax calculated at progressive rates. Any excess is refundable.

If the total income from fixed-income investments, including interest on OATs and government bonds, received for a given year by a tax household does not exceed €2,000, the taxpayer may opt for a flat-rate income tax of 24%. The taxpayer must choose this option when filing his or her general income-tax return. When the income payments exceed €2,000, they are liable to a tax assessed on the progressive income tax scale.

The taxation of inflation-linked OATs is very similar to that of other fixed- and floating-rate OATs for private individuals liable to income tax. Only the coupon actually received is taxable each year. Capital gains are taxed when the security is sold or on maturity, when the security is redeemed with the inflation-adjustment premium.