Taxes

There are numerous taxes that should be taken into consideration. These include:

• Tax for non-furnished letting - In the case of non-furnished properties, any rental income received in France is taxed by the French authorities at a base rate of 25%. The property owner can deduct expenses of up to 40% of the collected rent.
  **Note: The owner of a 'non-furnished let' is obliged to pay the 'tax fonciere'.
• Tax for furnished letting - Income from furnished lettings is taxed as commercial income. It is possible to deduct the following when computing the net profit: interest on loans, management expenses, insurance, and maintenance repairs.
  **Note: The owner of a 'furnished let' is obliged to pay the 'tax fonciere'.
• Capital Gains Tax - On sale of the property, capital gains tax is levied at 26%. However, if the owner retains the property for a period of 15 years there is no capital gains tax to be paid on it's disposal.
• Inheritance Tax - Succession is a complicated issue in France, with French inheritance laws that date back to Napoleonic times. Forced heirship favours the children of the deceased as opposed to the surviving spouse. Axis Property Consultants can provide further advice on this matter if required.