Legal - Detention - Taxes
Taxes
There are two taxes on all residential property. These are collected by the State for the local authorities. These taxes are assessed at individual rates according to location and can vary substantially.
Residence tax
(taxe d’habitation)
This tax is due by any person who occupies a furnished property. If the property is not occupied or if the tenant did not pay the tax, the owner is liable for its payment. This tax is calculated by applying the rate set by local governments to the official Land Registry rental value. The residence tax is assessed on a yearly basis. The tax is due on January 1st of each year. No rebate is granted if the property is sold or if the occupant moves out during the year. Non-residents cannot benefit from any reduction or relief.
Real estate tax
(taxe foncière)
This tax on lands and buildings is assessed on a yearly basis. It is due by any person who own a property on January 1st of each relevant year. New constructions benefit from a two year temporary exemption. The real estate tax is also based on the official Land Registry rental value.
Maintenance charges
(charges de Co-Propriété)
For those owning property such as an apartment within a complex there are maintenance and service charges to pay. You should consider these charges before signing the Compromis. The charges will vary according to the size and quality of the complex, whether there are lifts, swimming pool, gardens, tennis courts and other facilities.
Wealth Tax in France
Individuals resident in France and non-residents with assets in France are taxed on the basis of their assets as at 1rst January each year. Wealth tax is known as ISF (Impot de Solidarité sur la Fortune).
Residents are liable to wealth tax on their net worldwide assets including all properties, subject to the provisions of tax treaties. The tax is based on the wealth of the household, including spouse and infant children. Unmarried couples living together are treated as one household for wealth tax purposes. Wealth tax liability is reduced by €150 for each dependent child under 18 years of age.
· Taxable assets include: real estate, cars, other vehicles, debts due to you, furniture (except antiques), horses, jewelery, shares, bonds and the redemption value of any life assurance.
· Exempt assets include: those necessary to a business conducted by its owner or their spouse; pictures, tapestries, statues, sculptures, lithographs, antiques over 100 years old; funds in a pension fund constituted in respect of an employment or business (subject to certain conditions); and also portfolio investments and cash held by non-residents.
Non-residents are only liable to wealth tax on their net French assets. These include any property or any rights over property situated in France, whether held directly or indirectly, including shares or interests in unquoted companies whose seat of management is situated outside France and where more than 50 per cent of the assets comprise property in France.
Liabilities such as mortgages and other debts are deductible in arriving at net assets.
