What taxes will I have to deal with if I buy a holiday home in France? If you buy a holiday home in France, you have to take various taxes into account. We list them for you so you know where you stand when you buy a holiday home.

Costs for the buyer

If you buy a second home in France, you will pay a tax of 5.7 per cent of the purchase price. This amount is part of the average 7.7 per cent buyer’s fee (‘frais de notaire’ or ‘frais de l’acte de vente’) that applies in France. New homes taxed with VAT are an exception to this cost. For properties above €750,000, a lower rate applies.

Taxe foncière

As an owner, you pay the taxe foncière, a land tax. The amount of this tax can vary greatly from one municipality to another. The estate agent or seller is obliged to declare the amount when the house is put up for sale.

Taxe d’habitation

The taxe d’habitation is a resident tax that you pay as a resident. The amount is based on the rental value and the habitable area. Again, there are big differences between municipalities. If you rent out the property for a longer period, the tenant pays this tax.

Wealth tax

You are obliged to declare your second home in France to the Belgian or Dutch tax authorities. However, due to the double taxation treaty with France, you only have to pay taxes in the country where the property is located.

Tax on rental income

Do you rent out your French holiday home? Then you have to pay taxes on the rental income. This is done in France, not in Belgium or the Netherlands. You file a tax return at the special tax office for foreigners SIPNR (Service des Impôts des Particuliers Non-Résidents). Important to know: you have to report this to the tax office yourself. Don’t wait for them to contact you, it could result in a fine.

Profits tax

Are you going to sell the second home in France? Then you have to pay the taxe sur la plus-value or profit tax. If the property has not increased in value, there is no profit and so you pay no tax. Otherwise, the rate is 27.6 per cent of the increase in value after deducting demonstrable improvement costs. This rate applies if the property is sold within five years of purchase. Between the fifth and 30th year, the tax goes down slowly. If you sell the property after thirty years, you pay no more tax.

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