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Panic: New tax law in France. True?

Posted by me_2003 - Created: 15 years ago
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10 replies (Showing replies: 1 to 10)

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Posted by TonyP-191937 - 14 years ago

You are supposed to pay the taxe d'habitation if you have a second residence in France, but this is not new.  In the case of Cannes I think the "taxe d'hab" is good value considering the facilities provided by the commune.

There is also the tax on unfurnished properties that have been unoccupied for 2 years or more, but it doesnt apply to 2nd residences that are furnished, and subject to the taxe d'hab even if you dont use them for a couple of years. 

There are also a lot of exemptions for the unfurnished properties tax, for example if you have been trying to sell the property for 2 years without finding a buyer you dont have to pay the tax.  It is aimed at speculators who buy a property and expect the value to go up.

I have not heard of any other taxes, and I would have expected the French to make more of a noise if one was to be introduced.

It is possible that the original rumour last month was a "poisson" as they say.


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Posted by lynnettejane - 14 years ago

Villefranche is included as is most of the region towards monacoregards Lynnette

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Posted by rosetta-185721 - 14 years ago

Don't think it's a new law. According to the recent Cote mag: the tax was introduced to encourage property owners to rent instead of leaving properties empty. It's payable on any place that has been empty for two years or more and is in Paris, Bordeaux, Cannes, Grasse, Antibes, Lille, Nice, Montpellier Lyon or Toulouse. The tax is calculated on the rental value and varies, depending on how long the place has been empty: 10% on the first year that accomodation become taxable (presumably year 3 of it being empty), 12.5% second year and 15% the third year onwards.

Doesn't sound unreasonable to me - I guess you are exempt if you buy in just inland in Valbonne or Biot. Seems odd that Villefranche, Beaulieu etc aren't included too.


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Posted by telim - 15 years ago

The fog has still not clear on this one.  I read a lot about this on the impots website and the stuff is too old to discuss new agreements from 2004.

Any experts out there?

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Posted by will 06 - 15 years ago

French Govt intervention to bring down property prices on the CDA to affordable levels for the local population is fundamentally floored.It wont happen because it is the banks that lend out the money.The French are prolific in ther ownership of vacant fun down dwellings knowing the pitfalls of letting them out.

History has shown that property price crashes have been as a result of high interest rate rises.That would not appear to be the case at the moment with the ECB talking about LOWERING interest rates and streathening sterling and fuelling higher house prices. 

It would be interesting to establish the number of Brits whose home on the CDA is their their primary residence or will become at a later date.As the local population will be hit as well I cant see it happening though I may prove to be wrong.

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Posted by lynnettejane - 15 years ago

Thanks Mike, I tried to make head or tail of the proposed tax agreement, went right over my head, it seemed to be primarily concerned with corporations etc. I am sure I have missed the relevant bits through lack of close reading. Now, can you tell me if you have heard of this tax on vacant properties? Is it totally different to this notional tax thing, am I liable or not? How come I have never heard of it before? Appreciate any help,regards Lynnette

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Posted by mike-179830 - 15 years ago

lynnettejane: the double taxation agreement between the UK and France has been in force for 35 years; it is merely about to be replaced by another one that is not yet in force.**************

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Posted by lynnettejane - 15 years ago

Hi all, it would seem that the double taxation agreement between France and the UK is not in force yet. Anyhow the tax that I have come across does not seem to be the same thing. For those who speak French this may be of help http://www.service-public.fr/ Click on logement, scroll down to impots and taxes, then click on taxe sur logements vacants. Now my understanding of this is that this tax is due on properties that have been empty for two years, but have basic amenities, are empty of furnishings and are not subject to taxe d'habitation. Also according to this information, second homes are exempt. However, today I have been informed by email from the French government taxation website that I am liable to pay this tax because it is applicable to the 06 region due the shortage of affordable housing. This might not be too bad as it is calculated in a similar way to taxe d'habitation, therefore I would not expect it to be too high, and it is payable yearly. However, according to the above criteria, my apartment would be exempt anyway. It is all very confusing, can anyone throw any light on this, in fact has anyone with a second home ever heard of it or indeed paid it? Thanks for any help,regards Lynnette

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Posted by me_2003 - 15 years ago

Will 06...many people will sell their houses and flats...

if you are buying you will have to think about the additional you are now liable for...forsure i would not buy now...

one friend of mine own a flat in antibes and just lost his job in England reduntant at 50...i think he will be selling very soon...


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Posted by mike-179830 - 15 years ago

quote:This is already in force for anybody resident in Monaco who ownes  a home outside in France

Depending on their nationality, I think. I remember a piece of case law where a British-Italian couple resident in Monaco got their notional income tax annulled becuase it was argued that their citizenship gave them rights to their nationalities' double taxation agreements, despite their residency. That was only a few years ago and I think it was confirmed by decree. Has that ruling been overturned? Perhaps a tax lawyer has the gospel answer..?