A landlord, in the course of his activity, must pay three taxes collected in favor of the local authorities: the taxe d’habitation, the taxe foncière, in some cases, the CET. In the “regime réel”, these taxes are deductible from the collected income.
In this article, we invite you to discover the operation and payment terms of these three taxes.
The CET, CFE and CVAE
- How is the CET calculated? The ‘contribution economique territorial’ (which has replaced the ‘taxe professionnelle’) consists of the sum ofthe ‘Cotisation Foncière des Entreprises and Contribution sur la Valeur Ajoutée’ (CVAE).
- Who pays the CFE? The lessors, whether professional or not, are subject to CFE regardless of the tax regime chosen (régime Réel Simplifié or Micro BIC regime).
In fact, as soon as the lessor sends the P0i in order to register its activity with a SIRET number, it is submitted to the CFE.
Upon receipt of the SIRET, you will receive the 751-sd questionnaire, relating to the activity, which must be completed and returned within 15 days so that the CFE can be calculated.
- How is the amount of the CFE calculated? The tax base of the CFE is the rental value of the property (as taken into account for property tax purposes). The amount is then determined by multiplying this base by the tax rate set by the municipality.
If the rental value is less than the minimum tax base calculated in the municipality where the property is located, a minimum contribution is due. This is determined on the basis of a base, the amount of which is set by the municipal council.
Note: For non-professional furnished tenants declaring to the Simplified Real regime, the CFE is a deductible tax on the income from the activity, in the same way as the property tax, insurance and co-ownership costs for example.
- When and how to pay the CFE? Since 2015, it is necessary to create a professional account on impots.gouv.fr using your SIREN number to pay your CFE, whether you are a professional or non-professional furnished landlord.
The CFE is paid by bank transfer and only on the impots.gouv.fr site before December 15 of the current year. We recommend that you check the “Payable on maturity” box (present in the options) so that you do not have to redo the manipulation every year.
For their 1st year of furnished rental activity, the lessors are exempt (unless you start your activity on January 1 of the year).
- Who pays the CVAE? The CVAE is intended for lessors who have more than 152 500€ of rental income. Therefore, most of lessors are exempt from it.
- In accordance with article 1407-1 of the CGI, the housing tax is payable for all furnished premises intended for habitation. Article 1408-1 specifies that shall be established in the name of the persons who, in any capacity, dispose of or use of the premises that are taxable on January 1.
The base of the tax on dwellings is calculated inn the same way as that of the property tax, with the taxable base being equal to 100% of the cadastral rental value.
The rates relating to the municipality and the department are set annually.
- Municipalities have the option of exempting from the furnished tax premises set up as rural accommodation, premises classified as ‘classés meublés de tourisme’ and ‘chambres d’hôtes’, located in areas of rural revitalization.
- On the other hand, premises subject to the territorial economic contribution are exempt from the payment of the housing tax if they are not part of the taxpayers’ personal, principal or secondary residence.
Who is liable for the ‘tax d’habitation’:
- The tenant: if he permanently and exclusively occupies the furnished accommodation and continues to have access to it even during his absence. The private use of the premises must be sufficiently permanent.
In practice, this will be the case in particular for the tenant who holds a lease for a principal residence and who occupies the accommodation on January 1. But if the occupation is only temporary or for a limited stay, the tenant will not be liable for any no housing tax;
- The lessor: whether the premises constitutes or is part of his personal home. Personal residence means an accommodation that the owner reserves for himself, as a principal or secondary residence, outside of rental periods.
As for the property tax, common law applies to the lessor of furnished accommodation. Thus, it is the owner or usufructuary of the furnished rented accommodation who is liable for the property tax.
The two-year exemption for new constructions introduced by Art. 1383 of the General Tax Code is maintained for the furnished rental company.
To benefit from this temporary exemption, a tax form must be produced for the tax administration within 90 days of the completion of the new construction.
Some tourist municipalities may introduce a tourist tax or a flat-rate tourist tax. These are the following municipalities:
- Classified stations;
- The municipalities beneﬁting from the additional allocation to municipalities and tourist or spa groups and from the specific allocation to tourist municipalities under the conditions of Art. L 2333-27 paragraph 2 CGCT;
- Mountain communes within the meaning of law N° 85-30 of January 9, 1985 on the development and protection of the mountain range;
- The municipalities that carry out promotional actions in favor of tourism;
- The municipalities that carry out actions for the protection and management of their natural spaces.
The tourist tax is payable by people who are not domiciled in the municipality and do not have a residence there for which they are liable to the housing tax, i.e. occasional tenants. The amount of the tax depends on the number of people accommodated and the duration of stay. The tourist tax is collected by the owner of the accommodation from the seasonal tenant.
When it is flat-rate, the landlords send a declaration to the town hall each year, indicating the rental period and the capacity of the accommodation, which serves as the basis for calculating the tax. The basic amount of the package is therefore independent of the number of people actually accommodated. The taxpayer is no longer the occasional tenant, but the landlord who thus loses the right to levy the proceeds of the tourist tax on his client but can nevertheless include it in the price of his services.
Whether the tax is flat-rate or not, it is the landlords who, under their responsibility, pay the amount of the tax in the fund of the municipal collector. The deadline for collection is set for each station by resolution of the municipal council.
The amount of the tourist tax is also set by deliberation of the municipal council of the municipality. The amount, flat rate or otherwise, varies from 0.20 € to 1.50 € per person per day, depending on the nature and comfort of the accommodation.
The product of the tourist tax or the flat-rate tourist tax are spent on expenses intended to promote tourist visits to the municipality.
- Exemptions and reductions :
Some people are exempt from the tourist tax, notably:
- Children under 13 years of age;
- The beneficiaries of certain social assistance;
- Civil servants and state agents who are temporarily called to a place of employment for the performance of their duties;
- People exclusively attached to sick in hydromineral, climatic and ‘uvale’ stations (place where a grape cure is done).
The Municipal Council may also provide for the exemption of persons who, through their work or profession, participate in the development of the station, or who occupy premises whose rent is less than an amount set by the municipal council.
Families who are holders of the large family card beneﬁt from the same reduction as that granted by SNCF.
When the tourist tax is flat-rate, no reduction or exemption is possible, except for establishments that have been operating for less than two years, which are exempt.
The ‘Taxe sur les logements vacants (TLV)’ and ‘taxe d’habitation’ on vacant residential property
- The tax on vacant dwellings can be claimed from the owner who has vacant accommodation for residential use.
This must have been vacant for at least one year on 1 January of the tax year. It only concerns dwellings located in certain municipalities (belonging to a continuous urbanization zone of more than 50,000 inhabitants), the list of municipalities is established by Decree No. 2013-392 of May 10, 2013.
- Who is exempt? You can be exempt from TLV if the property has been occupied for more than 90 consecutive days during the reference year.
You can prove this occupancy with your rental income statement, your electricity receipts etc. Another case of exemption is the involuntary vacancy of the property, if you cannot find a tenant for example.
Furnished second homes that are subject to housing tax are also not affected by this tax.
To conclude, a furnished rental business must pay various taxes in favor of local authorities as part of its practice.
Under the ‘régime réel simplifié’, these taxes are deductible from the collected income.