The UK has officially left the EU and the Withdrawal Agreement is now in effect, but what does this mean for future France property buyers? Brexit won’t prevent British people retiring to France or purchasing a second home in France, but there are still some changes to take into consideration. Here’s what you need to know about buying a property in France after Brexit.
Can British Buyers Still Get a French Mortgage After Brexit?
Yes! Although Brexit will affect your rights to live, work, and travel in France, it won’t affect your right to purchase or own property. Plenty of Australians, Americans, and other non-EU citizens already own property in France.
There is no reason that British buyers will have difficulty getting a French mortgage after Brexit either. While 100% mortgages are only available for French tax residents, EU nationals benefit from LTV mortgages of up to 80%-85%. A big question post-Brexit was whether or not British buyers would still be able to benefit from these rates or whether they would now be restricted by the maximum Loan-to-Value for Non-EU Nationals (which is 60%).
The good news is that despite what you may have heard, this has not been affected by Brexit. Brits can still get 80%-85% mortgages and Brexit hasn’t impacted the amount of deposit a Brit borrower needs either.
Will Brexit Affect Taxes and Inheritance Laws?
Brexit actually won’t change much in terms of buying a property. As a non-resident, you will not be liable for any additional taxes, and if you choose to rent your French property, any income will still be covered by the France-UK double tax treaty (meaning you will only be taxed on income in your country of residence). Brexit also won’t affect your UK Will or French inheritance laws.
Moving to France After Brexit
From 2021 onwards, British people no longer have the right to freedom of movement within the EU. That means if you want to retire or move to France, whether permanently or for a period of more than 90 days (the maximum length of visit for Brits travelling to France after Brexit), you will need to apply for a Long-Stay Visa Serving as a Residency Permit (Visa Long Séjour valant Titre de Séjour or VLS-TS).
Each VLS-TS application is assessed individually, and being a French property owner will not automatically grant you the right to residency. However, assets are taken into account, so it may help your application, especially if you own your French property without a mortgage.
Selling Your Property in France After Brexit: Capital Gains Tax
If you are resident in France and your French property is your main residence, Brexit won’t affect selling your property. However, for second-home owners resident in the UK, this could make a big difference.
EU exemptions no longer apply to UK owners from 2021, and this means two changes, both of which could be costly. First, you will be required to use a French Fiscal Representative (représentant fiscal) if you wish to sell your French property. Secondly, you will be liable to pay the full rate of France’s social surcharges (prélèvements sociaux) – 17.2% compared to the reduced rate of 7.5% for EU residents
Keep checking this page for the latest news on buying a property in France after Brexit or head to our Brexit zone to learn more about living, travelling, and property in France from now on.
[This article was originally published in July 2016]