Obligations & Tax Implications
Furnished property rentals bring many benefits but have you also thought about your obligations and the tax implications? Below you will find a brief summary of the main points you need to consider when running furnished property rentals in France.
Firstly, whether you are resident or not, registered as a business or renting as an individual, all French property rental income must be declared in France. The French financial year runs from January to December but the income tax returns are filed in May of the following year.
As a property owner, you have the choice of providing furnished property rental on a long-term or short-term basis and for the latter you can choose whether or not you provide services to your guests in addition to the accommodation. The way you set up your property rental business will depend on various factors and criteria and you need to take the following questions into account:
• Is this going to be your main professional activity or is it a form of top-up income only?
• Will its income represent more than 50% of the global taxable household income?
• Do you need to be registered in France for healthcare, retirement and other benefits?
• Do you need to recover VAT paid on the property?
• Do you wish to provide a range of services to your clientele in addition to the accommodation itself?
• How long do you intend keeping the property and using it for furnished property rental?
• What is the value of your worldly estate, including this property?
The answers to the above questions are necessary when deciding which category best suits your individual circumstances. There are many benefits but you will need to take into consideration your liabilities for income tax, capital gains tax, wealth tax and VAT when making your decision.
As the rules and regulations vary according to the different categories of furnished property rental, the individual circumstances of the owner and the types of services you wish to provide, it is imperative to seek expert advice in order to make sure of the most appropriate and tax-effective set-up for you.
With over 20 years’ experience in the furnished property rental field, here at SAREG our English-speaking experts can guide you through the different categories available to you and help you choose the most appropriate solution for you individual circumstances.
If you would like to make an appointment to discuss your situation with one of our experts or would like advice on any other matters, please contact Debbie Bradbury at SAREG on 00 33 (0)4 50 25 23 97 or by email
SAREG is a group of English-speaking chartered accountants based in the Alps who can assist you with all your accountancy needs from income tax returns to setting up a business or subsidiary in France, employing staff, handling your annual accounts. They can also provide advice on property investment, rental income and generally guide you through the different steps required to becoming resident and joining the French system!