The French government is considering plans to cut the ceiling for cash-in-hand transactions by two thirds, in a bid to increase tax revenues.
The move would affect many of the 200,000 Britons with second homes in France, who often pay tradesmen from the UK in cash to carry out work on their properties, according to a report in the Times.
The proposal, outlined in a government plan called Fight against fraud, would see the cash transaction limit for tax residents decrease from €3,000 (£1,900) to €1,000 (£640) per purchase.
French prime minister Jean-Marc Ayrault said the change would generate €1bn in additional tax revenue and is to launch a consultation on the issue. Under the plans, workers would were normally paid cash would be required to use cheques or credit cards with the €1,000 limit.
Ayrault said: 'This consultation is going to be started very rapidly so that a decree and legislative measures can be taken by the end of 2013.'
Under the proposals, the ceiling for fiscal residents of a country other than France will also be lowered from €15,000 to €10,000.
Elsewhere in the eurozone, Italy has already introduced a €1,000 ceiling on cash transactions, while Spain has banned payments over €2,500.