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TAXES

Taxe foncière: How you could pay less French property tax

Paying 'Taxe foncière' is a part of homeowning life in France - but, if you’ve built your dream home, made certain renovations, are older, disabled or on a low income, you may be entitled to a reduction or an exemption.

Taxe foncière: How you could pay less French property tax
Photo: RachelW1 / Pixabay

Here we explain the various routes to a tax cut…

New property

New properties, rebuilds, or additions to buildings – are exempt from taxe foncière for two years after their completion.

This exemption is total if the building is used as a home, whether it is a primary or secondary residence. It is partial if the building is used for any purpose other than housing.

You must apply for a temporary exemption at the tax office in which the new building is situated no later than 90 days after completion of the work to benefit from an exoneration the following year.

Renovation work

Home improvements – notably energy efficient home improvements – on older properties could net homeowners a three-year total or partial exemption on taxe foncière.

The property in question must have been built before January 1st, 1989. 

On top of that, the energy-efficient improvements must have cost at least €10,000 (excluding labour), if carried out in the year immediately preceding any application for a tax break; or €15,000 if carried out in the three years preceding any application.

To apply, first contact your local tax office.

Age

Among the various tax reductions are exemptions for older people living in France – especially those on modest incomes – on primary residences (not second homes).

A €100 reduction on taxe foncière for primary residences is automatically applied for homeowners aged 65 and over.

Homeowners who are 75 and older can, from the January 1st after they turn 75, be exempt from taxe foncière if their income is below a certain level. This is based on tax declarations filed the previous year, and is usually applied automatically – you can find the full details here.

This exemption applies even if they have moved into a retirement home, provided they retain exclusive use of the residence on which the tax is applied.

Beneficiaries of the solidarity allowance (Aspa) for older people on low incomes are also exempted.

Disabled homeowners

Beneficiaries of the supplementary disability allowance (Asi) or the disabled adults allowance (AAH) are exempt from paying the tax. This is applied automatically.

Low earners

Low-income homeowners can also benefit from a reduction in taxe foncière. To be eligible, your income must not exceed €11,276, for the first part of the family quotient, increased by €3,011 for each additional share.

To apply for this reduction, click here.

Unoccupied property

Owners of empty properties intended for rental may be entitled to a reduction in taxe foncière. To benefit, homeowners must apply to their local centre des Finances publiques.

Be aware, unoccupied properties may, in certain circumstances, be subject to taxes sur les logements vacants (TLV) and taxe d’habitation sur les logements vacants (THLV).

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PROPERTY

Bail mobilité: How France’s short-term rental contracts work

If you're after a short-term rental in France you might be offered a 'bail mobilité' (mobility lease) - here's how these work and whether they're a good deal.

Bail mobilité: How France's short-term rental contracts work

The bail mobilité is a relatively recent invention in France. It was created by the Elan law in 2018 and is a rental contract intended for people who have a temporary need for housing due to their professional activity – whether that be a work transfer, temporary posting, or status as a student. 

In order to qualify, the tenant must show proof that at the beginning of the lease they are in one of the following approved situations: enrolled in professional training or higher education, completing an apprenticeship or internship, on a temporary posting or having received a work transfer, or working as a volunteer as “part of a civic service.”

You can find more specific information about these situations on the French government website HERE

This essentially means that if you are visiting France for an extended period of time for tourism purposes, you likely would not be able to rent using a bail mobilité. This might be a source of confusion for those who see these lease arrangements advertised on websites such as Airbnb (more on this below). 

There are some rules that lodgings listed as “mobility leases” must follow. They must always be furnished rentals – meaning they are required to provide the tenant with specific items such as bedding, dishes, and other things. You can learn more HERE.

READ MORE: Renting property in France: Should I go for furnished or unfurnished?

Next, the lease itself must be between one to ten months. It cannot exceed ten months. Additionally, mobility leases cannot be renewed. If the tenant and landlord want to renew the rental, it will have to be within the context of a standard furnished rental contract.

With a mobility lease, the owner is not allowed to ask the renter for a security deposit (dépôt de garantie). However, they do have the right to request a guarantor (un garant, or sometimes referred to as a caution). 

In terms of the actual lease itself, it must include certain documents, similar to a standard furnished rental contract. The lease must include an inventory of fixtures (état des lieux), the technical diagnostic file (this includes the energy rating, for example), and if the property is located in a condominium or apartment building, then the regulations concerning common areas. 

The tenant retains the right to move out at any time during the lease – as long as they give one month’s notice to the owner (or the real estate company if the accommodation is managed by an agency). Typically, this is done via registered letter (lettre recommandée) with acknowledgement of receipt.

On the other hand, the landlord cannot terminate the lease before the end date (unless the tenant does not respect their obligations, such as paying rent). 

When it comes to determining the rental price of a dwelling listed under a bail mobilité, the landlord can set the rent by their own standards, as long as the lodging is not located in a zone tendue (housing shortage area) and therefore is not bound by local rent caps. However, rent cannot be revised during the lease and it should be listed within the rental contract.

Finally, if the property is being rented to more than one person (a colocation), the lease cannot require the roomates to have a “solidarity clause.” This is a part of the lease that would outline the requirement of the co-tenant(s) to pay the rents even if another co-tenant gives notice and moves out. Typically, this would also outline when that expectation for the other tenant(s) to cover remaining rents would end. 

Common questions about mobility leases

First, the bail mobilité is often confused with the “secondary-residence lease.” The two differ primarily due to the fact that a mobility lease can constitute a primary residence, depending on the duration of the lease.

The next common question regarding mobility leases is whether it is possible to rent one via an online rental platform, such as Airbnb. The short answer is – yes. However, as mentioned before, the bail mobilité is only available to specific groups of people.

Renting with a mobility lease absolves the requirement to pay the ‘tourist tax’ (taxe de séjour) in certain cities – as it is a residential lease and not a tourist accommodation. The tourist tax is automatically added to Airbnb charges, but in certain French cities such as Paris, Lyon, Bordeaux, Toulouse, Nantes, Lille Nice, Strasbourg, and Marseille, booking with a mobility lease automatically exempts the renter form paying the tourist tax. 

READ MORE: What are the rules on renting out French property on Airbnb?

In other parts of France, people signing mobility leases via Airbnb may be charged a tourist tax, but this can be refunded by request at the local town hall. 

Additionally, renting a property under a mobility lease exempts the owner from having to do a “change of use” declaration with the town hall, as the property will technically continue being used as residential accommodation, rather than touristic. This authorisation is mandatory for furnished tourist accommodation in many French cities.

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