Real estate taxes in France
There are 2 types of property taxes in France, the taxe d'habition and the taxe foncière. Anyone who lives in France pays the tax d'habitation. No matter if you own or rent the place, as a resident or not, this tax will apply. The liability for the tax foncière lies by the owner of the property. If you are the owner and principal user of the property, you will pay for both taxes.
The tax foncière is a combination of tax for the building (taxe foncière bâtie) and for the land (taxe foncière non bâtie).
The rate depends on the facilities of the building, improvements and quality of the building. If you make any improvements on the building, you have to notify the land registry within 90 days.
The amount of taxes paid depends highly on the area, they will be substantially higher in popular cities with a high population density and beach areas than in rural areas, in popular tourist areas, a taxe assimilée may apply. This tax is to pay for parks, parking, buildings, etc.
Income tax in France
First we need to determine who is liable for French taxes. Secondly, France has double taxation agreements with many countries, which means that if you pay taxes in one country, you use that as a tax credit in the other country.You are tax liable in France if one of the following applies:
- You spend 183 days or more in France in one calendar year.
- Your permanent home or principal residence is in France.
- The source of your professional income is in France, unless it concerns a secondary source of income and is part of foreign business activities.
- Your main source of investment, income or business is in France.
To do your own tax filing is not an easy task, unless your filing is very basic. Best is to hire an accountant to assist you. Income tax in France is usually paid in installments.
The system of double tax agreements is not all that complicated but in real life you have to be knowledgeable with all the tax regulations and bureaucracy. This is why many foreigners choose for an offshore account to protect their assets. The USA is the only country that will tax you on income, no matter where the source of your income is located. As "overseas" tax filer. There is a substantial deduction and there is a "double tax" agreement between France and the US.
When you leave the country you need a tax clearance statement. All taxes due, until the day you are leaving, must be paid. The tax inspector will estimate your tax liability based on income and deductibles and if the estimate turns out to be to high, you may ask for a refund. It is important to obtain this clearance statement, without it you will have trouble getting your belongings out of the country.
- EU members
- USA
- Australia
- Canada
- New Zealand
- India
- Israel
- Japan
- Malaysia
- Pakistan
- Philippines
- Singapore
- Sri Lanka
- Switzerland
If you are not sure if your country has a double taxation agreement with France, you should check with the authorities.
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