Property-Related Taxes in France

France generally taxes nonresidents on income derived from French sources, subject to applicable double-tax treaties. French real estate can give rise to income tax, social levies, capital gains tax, annual local property taxes and, for sufficiently large portfolios, the Real Estate Wealth Tax (IFI).

Income Tax for Nonresidents

French-source income received by nonresidents is generally calculated under the ordinary progressive income-tax rules, but a minimum tax rate applies.

For income received in 2025 and declared in 2026, the minimum rates are:

• 20% on net taxable income up to €29,579
• 30% on net taxable income above €29,579

These are minimum rates rather than a separate two-band flat-tax system. A nonresident may request application of the average tax rate (taux moyen) calculated by reference to worldwide income where this produces a lower French tax liability.

Rental Income Tax

Rental income from French real estate is generally taxable in France even where the owner is nonresident.

For an unfurnished residential property, rental income is generally classified as revenus fonciers. Under the micro-foncier regime, where the relevant conditions are satisfied, the taxpayer receives a 30% standard deduction, meaning that 70% of gross rental income is taxable. Alternatively, under the régime réel, qualifying actual expenses can be deducted.

Deductible expenses under the real regime can include qualifying repairs and maintenance, management expenses, insurance, certain property taxes and eligible financing costs.

Furnished rentals are taxed under separate BIC rules. The applicable standard deduction and eligibility thresholds depend on the type of furnished accommodation, particularly whether it is an ordinary furnished rental or classified or unclassified tourist accommodation.

French property income earned by a nonresident is also generally subject to social levies. Nonresidents who are affiliated with a qualifying compulsory social-security system in an EEA country, Switzerland or the United Kingdom and are not subject to the French compulsory social-security system are generally exempt from CSG and CRDS but remain liable to the 7.5% solidarity levy.

Other nonresidents are generally subject to social levies of 17.2% on unfurnished rental income. Different rules can apply to furnished rental income, including a 18.6% social-levy rate from 2025 in relevant cases.

For comparison purposes, the examples in this guide assume deductible expenses equal to 30% of gross rental income; after these deductions, the resulting net rental income is subject to French income tax as well as social levies of generally 17.2%, or 7.5% for qualifying nonresidents covered by an applicable EEA, Swiss or UK compulsory social-security system.

Capital Gains Tax 

Capital gains realized by a nonresident on the disposal of French real estate are generally subject to French income tax at 19%.

The taxable gain is generally calculated by reference to the sale price less the qualifying acquisition cost and allowable acquisition, improvement and disposal costs.

A holding-period allowance progressively reduces the taxable gain. For income tax purposes, the allowance is 6% for each year of ownership from the 6th through the 21st year and 4% for the 22nd year. The gain is therefore fully exempt from the 19% income tax after 22 years of ownership.

Separate holding-period allowances apply to social levies, with full exemption after 30 years.

Nonresidents outside the qualifying EEA/Swiss/UK social-security exemption generally face social levies of 17.2% on taxable French property gains. Qualifying individuals covered by the relevant EEA, Swiss or UK social-security rules are generally exempt from CSG and CRDS but remain subject to the 7.5% solidarity levy.

Corporate Tax

The standard French corporate income tax rate is 25% of taxable profits.

Qualifying small and medium-sized companies can benefit from a reduced 15% rate on the first €42,500 of taxable profit, provided the statutory conditions are met, including the turnover and ownership requirements. Taxable profit above €42,500 is generally subject to the standard 25% rate.

Rental income and taxable property gains earned by a company subject to French corporate income tax are generally included in its taxable profits, with qualifying business expenses deductible.

Property Buying and Selling Costs in France

Annual Property Taxes

Taxe Foncière

Owners of French real estate are generally liable for annual taxe foncière.

Taxe foncière is calculated using the property's cadastral rental value and rates determined by the relevant local authorities. 

For developed property (taxe foncière sur les propriétés bâties), the taxable base is generally 50% of the cadastral rental value, to which the applicable local rates are applied.

The actual liability therefore depends heavily on the municipality and the property's cadastral assessment.

Taxe d'Habitation

Taxe d'habitation has been abolished for principal residences but remains relevant to second homes and certain other furnished residential properties.

This is particularly relevant to nonresident owners who retain a French property for their own use as a secondary residence. Municipalities in certain areas may also impose a surcharge on taxe d'habitation for second homes.

Real Estate Wealth Tax (IFI)

Nonresidents may be subject to France's Impôt sur la Fortune Immobilière (IFI) where the net taxable value of their French real estate assets exceeds €1.3 million.

Subject to the applicable rules for deductible debts and exemptions, nonresidents are generally taxed on qualifying French real estate rather than their worldwide real estate.

IFI uses progressive rates ranging from 0.5% to 1.5%. Although liability begins when net taxable real-estate wealth exceeds €1.3 million, the progressive calculation begins from the applicable lower tax bands under the IFI scale rather than simply imposing tax only on wealth above €1.3 million.