Fees, taxes and charges when buying real estate in France
You want to buy your first property in France and you are not a tax resident? We summarize all the fees, taxes and charges that may apply and explain them to you. This will allow you to better define your budget so that it takes into account all the costs, whether they are related to the acquisition or the holding.
1- What are the costs of becoming a homeowner?
The first expenses to be taken into account will be the expenses related to the acquisition, some are mandatory and others optional
It is not necessary to work with a real estate professional to buy or sell a property in France. However, from abroad, it seems essential to benefit from the help of a professional who will share with you his knowledge of the market, who will accompany you in your project by guiding you on your rights and duties in all confidence.
The transaction fees, commonly called « agency fees » are not regulated and are different between all real estate professionals. (You will find the regulations related to the real estate agent profession here)
It costs nothing to compare the rates and services offered by each player in the business, so choose the formula that best meets your expectations. You will find all our services and fees on our page
Acquisition costs, mandatory and often misunderstood.
he acquisition fees are the fees that the buyer pays on the day of the signing of the deed of sale, these fees are to be paid to the notary and are added to the purchase price of the property. They vary between 2 and 3% of the sale price for the purchase of a new property and between 7% and 10% for the purchase of an old property. What are these fees made up of?
Taxes and duties called registration fees, they are paid directly to the Treasury
Public and return to the state or local governments.
The costs and disbursements, they are used to remunerate the various parties in charge of producing the documents necessary for the change of ownership (mortgage registrar, registration of mortgage guarantees, costs of publication of the sale, urban planning document, extract from the land registry, surveyor, etc.).
The notary’s fees, do not make the mistake of thinking that the whole ofis the notary’s fee, a small part (about 15%) is intended to pay the notary for his work.
For more information on acquisition costs, please visit the official website of notaries
2- What are the taxes for a landlord?
In France, there are mainly two local taxes called property tax and housing tax, but depending on your situation you may be subject to the tax on vacant dwellings or the housing tax on vacant dwellings.
The property tax. is due each year by the owners of built and unbuilt properties (homes, industrial and commercial premises, land, etc…). The property tax is calculated by the tax authorities according to the cadastral rental value of the property and the rates determined by the local authorities.
The housing tax. This tax concerns all residential dwellings (primary and secondary residences) and all occupants (owners or tenants). This tax is calculated directly by the tax authorities according to the situation of the occupant on January 1st of the tax year. The amount due is calculated by multiplying the net rental value of the property by the tax rates determined by the local authorities.
The tax on vacant dwellings. This tax concerns the owners of a dwelling that has been unoccupied for at least one year. You may be exempt if you meet the following conditions:
The dwelling requires work of at least 25% of the value of the property and is not habitable as is.
Empty dwelling because it awaits a future tenant or future owner within the framework of a setting in hiring or within the framework of a setting in sale.
Occupied for at least 90 days in a row
Furnished secondary residence subject to property tax
The tax on vacant dwellings applies in the tense zones, but in certain other zones, the tax on vacant dwellings may apply. Go to the site of the French administration to know in which zone your property is located.
3- What are the taxes for a non-resident owner?
Taxation in France exists as soon as you generate income, whether it is in the form of remuneration, dividends, capital gains from real estate or securities, rental income, etc…
Also, the tax authorities have created a tax that is calculated according to the value of your real estate assets.
Rental income. You want to rent your property and you wonder how your income will be taxed. The taxation and the taxation depends on several elements:
Empty or furnished rental
Annual rental amount
Resident of the European Union or outside the EU
Total duration of the lease
Etc…
Furnished rental is clearly more advantageous than empty rental because it allows you to deduct from your furnished taxable income the costs related to the acquisition of your property, whether it is new or old, and also allows you to deduct the depreciation of the furniture and the property, whether in LMNP or LMP, which ensures that you do not pay taxes for several years.It also allows you to deduct the depreciation of the furniture and the real estate, whether in LMNP or LMP, which ensures that you do not pay taxes for several years.
Since the last modifications applied to the LMP status, the latter has become even more advantageous with, in particular, the possibility of being completely exempted on the capital gain generated at the resale of the property (according to certain criteria). Let’s share your project so that we can send you a personalized study
The Tax on Real Estate Wealth, IF. This is the tax that replaced the ISF, the tax on real estate wealth, a few years ago. As a non-resident, you will be subject to this tax only on your French assets, unless exempted, as long as they are valued at 1.3 million euros or more. Below is the tax bracket table:
Fraction of the net taxable value of the assets
Applicable rate
Not exceeding 800 000€.
0%
800 000€ to 1 300 000€
0,50%
1 300 000€ to 2 570 000€
0,70%
2 570 000€ to 5 000 000€
1,00%
5 000 000€ to 10 000 000€
1,25%
10 000 000€ and more
1,50%
The IFI declaration must be made at the same time as the income tax declaration (IR), either by internet or by mail depending on your situation. WALDORF PRIVATE OFFICE can help you through its service of administrative management if you need help.
The taxation of real estate capital gains can be costly. If you sell your property for more than you paid for it, then you are normally concerned, unless you are exempt.
First, the gross capital gain is calculated, then the net capital gain before applying the tax rates.
Gross capital gain = Sale price – Purchase price
The purchase price may be increased:
Notary fees at the time of purchase, approximately 7.5% (fixed price)
Construction, reconstruction or expansion work, either in real terms or at a flat rate of 15% if the property has been owned for more than 5 years.
The net capital gain is the gross capital gain after deduction of the deductions for length of ownership, according to the table below:
Holding period
Applicable income tax deduction rate
Applicable deduction rate for social security contributions
Under 6 years old
0%
0%
Grades 6 to 21
6%
1,65%
22nd year
4%
1,60%
23rd to 30th year
Exemption
9%
Beyond the 30th year
Exemption
Exemption
The tax rate applicable to the net capital gain is then as follows :
19% income tax + additional surtax of 2 to 6%.
17.2% Social security contributions (CSG)
