New French Property Taxes in 2012
One of the new tax proposals effective from January 2012 in France is a new 20% tax on the rental value of SECOND homes for ANY nationality.
The tax will be 20% of the property’s “valeur locative cadastrale” (a theoretical value). You can find this value at www.cadastre.gouv.fr. So if a property has a rental value of 3000 euros then the annual tax would be 20% of 3000 euros – i.e. 600 euros per year.
First, this does not apply to expats who are now living in France permanently. Although there are separate proposed changes to their wealth tax.
Second, if you ensure that your home(s) is available for rent for the whole year via a local letting agent then there will be no charge.
At this stage there are no indications how the tax will be applied if the property is not available for the full year.
In addition, the new 20% is likely to be challenged under European Law (since it will discriminate against foreign owners of holiday homes)
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