Tax System

thIn France, the rental income is taxable. Several features allow the reduction of the tax bill, rental empty as furnished rental.

Accept rents: this is the main objective of all those who invest in rental property. You perceive as waste additional resources.
Empty rental, you are subject to taxation of property income. If you rent furnished, you are taxed under industrial and commercial profits (BIC). Each of these devices allows you, under specific conditions, to reduce taxes related to your real estate investment.

Empty location, a number of expenses are deductible from your rent when you declare them to the tax authorities. This is particularly the case of the work and interests of the loan that finances your rental investment. When these charges are higher than the rent, creating land deficits, which are booked on your overall earnings. So, they go down, reducing your taxes. You can also enjoy tax exemption devices like the former Borloo and even the new law Pinel (an improved version of the old device Duflot) if you invest in a renovated and refurbished accommodation.

Furnished in two options. With the real system of the status of non-professional furnished renter (Leaseback), you deduct expenses (works, loan interest, etc.) and depreciation of your rental income. They are reduced or even reduced to zero. They escape taxation. With the landlord status in professional furnished (LMP), if the deduction of your expenses shows a deficit, it is deductible from your total income. So, they go down, reducing your tax burden. Secondly, once the sponges deficits, depreciation come bring your rents to zero when you declare.

All of these tax regimes obey specific rules that must be respected to the letter to avoid any recovery.
Do not hesitate to contact our OHM Invest advisors to be oriented correctly.