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Land Value tax and Residence Tax in France

Land Value Tax : Taxe Foncière

Land value tax is an annual tax for property owners in France. It applies regardless of whether your property is occupied by you or rented out to tenants. It needs to be paid by the 1st of January every year and is divided between community services.

The tax is calculated by assessing the notional rent the property could earn. That assessment is then discounted by 50 percent to factor in cost of running the house, such as repairs, home insurance and so on. Further to this, a percentage rate is applied to the notional rent based on the amount that the authorities need to raise, referred to as taux d’imposition.

The rate of tax often varies depending on whether the property is your main home or a second home. To query the tax, you will need to contact your local Centre des Impôts Fonciers, the contact details of which should all be provided on your tax form.

 

Residence Tax : Taxe d’habitation 

In the same vein as the Taxe Foncière, Taxe d’Habitation is an annual tax for the residents of a property. You do not have to be the owner of the property; the law states that if you are the rightful occupier of the property on the 1st of January (whether you are a temporary or permanent tenant) then the tax is payable. Your liability for the tax is not related to how long you occupy the property.

For example, if you only occupy the property a few weeks in the year, and the remainder of time it is let out as a furnished property, you could potentially be exempt, but may instead be liable for business rates. If the property is let on an annual basis, then the tenant is liable for Taxe d’Habitation.

For more information, expatfocus.com

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