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Investing
in property in France if you're non-resident foreigners or EEC request to
conduct a preliminary study of fees and taxes you'll pay
Conduct a study of your legal, tax and family before investing in France
is essential to know the actual cost will involve your property purchase
You are a foreigner without EEC or EEC, French
or not resident in France and you want to buy a primary or secondary residence
for your vacation you're going to rent furnished or empty or not.
Want to invest in a country with a legal and political importance, then
you should know that buying real estate in France will produce effects should
be studied before the vesting of the property that you want to buy.
France knows the different taxes that are tied to real estate (property
tax, wealth tax, housing tax, property tax for properties owned by a corporation)
and the French tax for many foreigners is not easy to understand.
Let's see here the different taxes you will pay if you buy an apartment
or villa in France (we recommend filling out the form below to have an assessment
of your tax situation when buying a property in France) :
The
housing tax :
It is a tax which is established annually, depending on your situation at
1 January of the tax year.
The tax therefore depends on the occupant on January 1.
If you buy a property in France to invest and you give this property to
rent empty, then it will be your tenant to pay the tax.
If you rent this property so furnished, you must pay the payment of this
tax.
The residence tax is due even if the taxpayer does not take personally the
housing, for example if the first trip in January, or if a second home unoccupied
in winter.
Property
tax :
The budget of municipalities, intermunicipal, departments and regions, is
partly funded by the land tax on built property, which contributes to the
development of community facilities and services offered.
You should logically pay property tax each year. The property tax is calculated
based on the rental value register.
This is the basic concept of direct local taxation : In fact, used alone
or with other elements to calculate the basis of each local direct taxes.
The evaluation of properties is handled by the competent public finances,
whose details are shown on the tax notice, with the assistance of municipal
and county boards of direct taxes involving local officials and taxpayers.
If
you sell your property, you may have a capital gain property to pay :
If the property you bought in France is your principal residence. You will
be exempt from tax on capital gains when you sell real estate, if the building
is actually the residence of the transferor at the date of the assignment.
When the resale of the second home, the capital gain are taxable under the
capital gains on immovable property, the inverse of the principal residence.
Finally, when selling the real estate capital gain is taxed at a flat rate
of 16% for EEC residents (with a further 12.1% with social security contributions
for a French resident).
However, a deduction of 10% per year of ownership applies beyond the fifth
year round.
The tax therefore only 90% of the capital gain when you sell it after six
years, 80% after seven years and so on.
If the sale occurs more than fifteen years after purchase, so there is no
added value to pay.
The rate is 16% for capital gains realized by resident individuals at the
date of the assignment in a state of the European Economic Area (excluding
Liechtenstein).
It is against 33.33% for foreign nationals outside the EEC.
If you rent your property in France, you will
be taxed on the income from your investment Owners in France:
Those whose tax residence is outside France were punished, in France, the
income tax for their sole income from French sources.
Land rents are income from rental of buildings of any kind or undeveloped.
Net property income (after deduction of expenses) provided by one or more
properties located in France is subject to the schedule of tax on income.
People who have their tax domicile abroad but who have, in France, one or
more dwellings are, in principle, subject to French tax:
Either because of their income from French sources,
Either a flat rate equal to three times the rental value of these homes,
if their incomes do not exist in France or lower than the flat rate.
This provision does not apply to non-residents domiciled in a country linked to France by a tax treaty.
It does not apply if the non-resident French nationals can justify being subjected to his country of residence to a personal tax on his total income at least equal to two thirds of what it would have to support in France on the same tax base.
If
you want to acquire your property as a company you should know there is
a tax on property owned by certain legal persons :
The French or foreign legal persons, organizations, trusts that own, directly
or indirectly, one or several buildings in France are liable to pay an annual
tax of 3% sitting on the market value of these buildings.
This fee is applicable regardless of the form of legal entity (company or
corporation, associations ...).
The tax is levied on property or rights of property owned on January 1 of
the tax year.
If
you buy a property in France more than 790,000 Euros, you will have to pay
tax on the Fortune ISF wealth tax :
People who do not tax their residence in France are still as likely to be
subject to French tax and duties, tax on property or wealth tax.
The solidarity tax on wealth is calculated by applying to taxable net value
of assets, the following scale:
Heritage not exceeding € 790,000: 0%
Between € 790,000 and € 1,290,000: 0.55%
Between € 1,290,000 and € 2,530,000: 0.75%
Between € 2,530,000 and € 3,980,000: 1%
Between € 3,980,000 and € 7,600,000: 1.30%
Between € 7,600,000 and 16,540,000 1.65%
More than € 16,540,000 1.80%
If
you die, the property you own in France will know a particular legal and
tax treatment that will affect your heirs :
Here we must refer to the various agreements signed between different countries
to avoid double taxation and rules of different divisions.
Investing or buying real estate in France for
his principal residence, secondary or simply place their money in a country
is to realize a secure investment for the future but thought that investment
should not be done lightly and should be first master all the costs that
will result in property purchase.
Surround yourself and be advised by a professional who has mastered all
aspects of property tax and real estate investment with a thorough knowledge
of the real estate market where you want to invest that shows where you
are going and avoid many mistakes that will be detrimental time.
What form to buy, research your funding source and make a tax audit, legal
and finance is a necessary preparatory measure to put in place before choosing
the property you want to invest in France.
For a free study of your real estate investment project in France, please fill out the form below. A counselor will contact you shortly to talk with you.