French Property Tax

By Yvonne Drolshagen, Director and Advisor at Aquitaine Lifestyle Solutions.

It’s that time of year when French property tax comes to the fore. If you own a property in France you could be eligible for two taxes each year in the form of Taxe Foncières and Taxe d’habitation.

Taxe Foncières

This annual property ownership tax is paid by the owner, whether or not the property is occupied by them or rented out. The tax is levied for the year in which it is imposed, payable on 1 January of that year and goes towards the funding of local services by the commune, intercommunal and departmental councils.

Bills for Taxe Foncières are available on your personal on-line tax account and have to be paid by 15 October at the latest (the amount being debited on 26 October). Unless you have already opted to pay on a monthly or annual basis by direct debit (which will be automatically renewed for another year), you must pay the full amount. You can pay by smartphone or tablet using the Flash/QR code on the bill, or at www.impots.gouv.fr where you will need to log into your tax account and follow the instructions.

Next year’s requests for direct debit payments must be made by 1 October 2021 for 2022 payments.

Yvonne Drolshagen, Aquitaine Lifestyle Solutions

Taxe d’habitation

The second French property tax is Taxe d’Habitation. This annual residence tax is paid by the occupier of a property in which they were resident on 1 January of each year.

If you rent out your property on a long or short term basis (holiday rentals are not applicable), the renter pays this tax. If the property is your second home, and even if you are not in residence on 1 January, the tax is still payable (unless the house is under renovation and inhabitable).

The basic rate is decided by the local council (commune), but the calculation and collection of the tax is carried out by the central government tax authority. The deadline for main residence payments is 16 November this year if paid by SEPA (TIP) or cheque, and 21 November if you pay electronically (online payment, direct debit or monthly). Direct debits will start from 26 November.

Are you exempt from residence tax?

There have been changes to French property tax. In 2020, the housing tax on main residences was abolished for 80% of households. This exemption is granted automatically, but the TV licence will still be due and is normally part of this bill. If you are not exempt, you can consult your Taxe d’habitation notice on www.impots.gouv.fr under “My events”, on the home page of your personal account, and also in the “Documents” section.

For 2020, you are exempt if your 2019 tax income falls below these ceilings:

27,706 € for 1 tax part (single person)
35,915 € for 1.5 tax parts
44,124 € for 2 tax parts (couple)
50,281 € for 2.5 tax parts (couple + 1 child)
56,438 for 3 tax parts
62,595 for 3.5 tax parts

A reduction may be made if your 2019 tax income slightly exceeds these figures. However, second homes and vacant dwellings are not affected and housing tax is still paid.

The 2020 finance law (Official Journal of 29 December 2019) confirmed the phasing out of this tax:

2019: low-income households saw a 65% reduction.
2020: lowest income households are fully exempt.
2021: 30% reduction for the highest income households.
2022: 65% rebate for the highest income households.
2023: all households will be exempt.

First published in the October and November 2020 issue of The Local Buzz

Images: Aquitaine Lifestyle Solutions and Shutterstock