Declaring Rental Income in France

If you own a property in France and rent it out, you are required to declare that rental income to the French tax authorities (Direction Générale des Finances Publiques, or DGFiP) even if you are not a French resident. How you declare, how much tax you pay, and which social charges apply will depend on how the property is rented, whether it is furnished or unfurnished, and the total level of income generated.

This guide walks through the two principal rental frameworks, the relevant tax regimes, the key forms, and the specific procedures for both agent-managed and self-managed rentals.

FURNISHED VS UNFURNISHED: TWO SEPARATE TAX FRAMEWORKS

French tax law treats furnished and unfurnished rentals as entirely separate categories, each with its own income classification, available tax regimes, and declaration rules.

THE FURNISHED RENTAL TAX REGIMES (BIC)

Most buyers of new build property in France whether a ski apartment or a villa on the French Riviera will rent their property furnished. This places rental income within the BIC category. There are two tax regimes to choose from.

Micro-BIC (Standard flat-rate allowance)

The micro-BIC regime is the simpler option and is available if your gross annual rental receipts stay below a defined threshold (currently €77,700 for standard furnished rentals, or €188,700 for classified furnished tourism properties - meublés de tourisme classés).

Under micro-BIC, the tax authorities apply a flat allowance against your gross receipts:

• 50% for standard furnished rentals - you are taxed on the remaining 50%

• 71% for classified furnished tourism properties (meublés de tourisme classés) - you are taxed on the remaining 29%

  
  

No deduction of actual costs is permitted under micro-BIC. It is the simplest route if your costs are modest, but it may not be the most efficient if the property carries significant charges, loan interest, or management fees.

Régime Réel Simplifié (Actual costs deduction)

Under the réel regime, you declare actual gross receipts and deduct actual allowable costs, which can include:

• Mortgage interest and bank fees

• Property management fees (including agent commissions)

• Co-ownership charges (charges de copropriété)

• Property insurance premiums

• Maintenance and repair costs

• Accountancy fees

• Depreciation (amortissement) of the property and furnishings

Depreciation is a significant advantage unique to the réel BIC regime. A new build property can typically be depreciated over 25-40 years, with furnishings depreciated over 5-10 years. This can substantially reduce and in many cases eliminate taxable income for a number of years.

The réel regime requires more rigorous bookkeeping and an annual commercial tax return (form 2031) alongside a simplified balance sheet (form 2033). Many overseas owners appoint a French accountant (expert-comptable) for this. Once elected, you are generally committed to the régime réel for two years.

THE UNFURNISHED RENTAL REGIMES (REVENUS FONCIERS)

Unfurnished rental income falls under revenus fonciers (property rental income). This is less common for new build property in resort locations, but applies if, for example, you rent an apartment on a bare basis without furnishings.

Micro-Foncier

Available if gross annual rents are below €15,000. A flat 30% allowance is applied automatically, and you declare the remaining 70% as taxable income. No deduction of actual costs is possible under this regime.

Régime Réel (Unfurnished)

Under the réel foncier tax regime, you deduct actual allowable expenses from gross rental receipts. Allowable costs include loan interest, management fees, insurance, maintenance, and property related taxes. Depreciation of the property itself is not deductible under revenus fonciers (unlike BIC).

You must file form 2044 in addition to your main declaration form 2042. A deficit under the réel foncier regime (where deductible expenses exceed income) can in some circumstances be offset against global income up to €10,700 per year, with the remainder carried forward for 10 years.

RENTING THROUGH AN AGENT VS SELF-MANAGING

The choice of how you manage your rental through an agency or independently does not change which tax regime applies, but it affects the paperwork, the rental income amounts you receive, and some practical declaration steps.

Renting Through an Agent or Rental Management Company

Many owners of new build resort properties use a specialist rental agency or a residence services operator to manage lettings. In this case:

• The agent collects rents from guests and remits net income to you (after deducting their management fees and, in some cases, utility costs or cleaning charges)

  
  

• You declare the gross rental receipts received not the net amount after agent deductions. The agent's fee is then deducted as an allowable cost if you are on the réel regime; under micro-BIC, the flat allowance is applied to the gross figure and no separate cost deduction is made

• Your agent should provide you with an annual rental statement (relevé de gérance) summarising gross receipts and all charges deducted. This is your primary supporting document for your declaration

  
  

• Some agents also handle the registration of the activity with the tax authorities on your behalf, though you remain personally responsible for filing your annual return

SELF MANAGED RENTALS

If you manage the rental yourself via platforms such as Airbnb, Abritel (HomeAway/VRBO), or through direct bookings you are responsible for:

• Registering as a meublé de tourisme with your local mairie (required for short-term lets; registration is free and straightforward)

  
  

• In certain communes (Paris and a growing number of cities and resort towns), obtaining a numéro d'enregistrement, which must be displayed in your rental listing

  
  

• Collecting and remitting taxe de séjour (tourist tax) from guests if required by the local authority rates and obligations vary by commune

  
  

• Maintaining records of all rental income received, with dates, amounts, and guest details

  
  

• Declaring gross income accurately, including income from foreign-based platforms

  
  

Platforms such as Airbnb are required by French law to report annual rental income earned through their platform directly to the DGFiP. The tax authorities therefore have visibility of income generated via major booking platforms, and under-declaration is readily detectable.

REGISTERING YOUR RENTAL ACTIVITY

Before you begin renting, you are required to register your furnished rental activity with the relevant authorities.

Registration with the INPI (Formerly CFE / Greffe)

Since January 2023, LMNP activity must be registered through the Guichet Unique (the single digital business registration portal operated by the INPI at formalites.entreprises.gouv.fr). You file a Pôle numérique declaration (formerly a form P0i via the Centre de Formalités des Entreprises or CFE).

This registration gives you a SIRET number (Company Registration Number) and formally registers you as a meublé operator under the BIC framework. You must complete this before generating your first rental income, or within 15 days of commencing activity.

VAT (TVA) Registration

Standard residential furnished rentals are exempt from TVA. You should not register for TVA unless you are operating a residence with hotel-like para-hôtellerie services (breakfast, regular linen changes, reception, cleaning during the stay), in which case TVA at 10% applies and a separate TVA filing obligation arises.

Taxe de Séjour Registration

If your commune requires it, register with the local authority to collect taxe de séjour from guests. Major booking platforms collect and remit this automatically in many French communes, but you should verify the position for your specific location.

FILING YOUR ANNUAL TAX DECLARATION

France operates a self-assessment system. Your annual income tax return must be filed online via impots.gouv.fr each spring, covering the previous calendar year. The exact deadline varies each year (typically late May to early June, with regional variations).

Forms Overview

Step by Step - Micro-BIC Declaration

For LMNP owners on the micro-BIC regime, the annual process is as follows:

• Log in (or create an account) at impots.gouv.fr

  
  

• Select Déclarer mes revenus and confirm or complete the main declaration form 2042

  
  

• Add the complementary form 2042-C-PRO. Under the section Revenus industriels et commerciaux professionnels or Revenus industriels et commerciaux non professionnels (for LMNP), enter your gross annual rental receipts in the relevant box (5ND for LMNP micro-BIC standard furnished; 5NG for classified tourist furnished)

  
  

• The 50% or 71% allowance is applied automatically by the system, you do not deduct it manually

• Review the pre-filled sections (salary, pensions, investment income) and correct any errors

  
  

• Submit online. A confirmation receipt (avis de dépôt) is generated immediately

Step by Step - Réel Simplifié Declaration (LMNP)

The réel declaration is more involved and most overseas owners will engage a French accountant:

• Your accountant prepares form 2031 (the commercial income return), reporting gross receipts, allowable deductions, and depreciation, arriving at net taxable income (or deficit)

  
  

• Form 2033 (simplified balance sheet) accompanies the 2031

  
  

• Both are filed electronically, ideally through a professional portal, by the deadline (typically mid-May for 2031 filings)

  
  

• Your accountant then transfers the net taxable figure to form 2042-C-PRO, which feeds into your personal income tax declaration

  
  

• If you have a déficit LMNP (allowable losses), these are carried forward and offset against future furnished rental income, they generally cannot be offset against other income for LMNP

Non-Residents: Additional Considerations

If you are not a French tax resident, your obligation to declare French-source rental income exists independently of your home country obligations. France has double taxation treaties with most countries (including the UK, Ireland, the US, and most EU states), which typically prevent the same income being taxed twice. You will usually declare the income in France and receive a credit or exemption in your country of residence, but the specific mechanism depends on your treaty.

Non-residents file the same annual return online. If you are unfamiliar with the process, the DGFiP's non-resident centre (Service des Impôts des Particuliers Non-Résidents, based in Noisy-le-Grand) handles queries specifically for non-resident taxpayers.

SOCIAL CHARGES (PRÉLÈVEMENTS SOCIAUX)

In addition to income tax, rental income in France is subject to social charges (prélèvements sociaux). The applicable rate depends on your status:

UK residents should note that following Brexit, the UK is no longer treated as an EU/EEA member state for social charge purposes. The DGFiP's current position is that UK residents are subject to the full 17.2% rate. This remains an area of evolving guidance and legal challenge, and we recommend taking specific advice from a French tax specialist on your individual position.

TAXE FONCIÈRE AND TAXE D'HABITATION

Alongside income tax, French property owners must be aware of two local taxes, though these are distinct from the rental income declaration process.

Taxe foncière is an annual property ownership tax levied on the registered owner, regardless of whether the property is rented. It is calculated on the notional cadastral rental value of the property and is billed directly by the local authority, typically in October.

Taxe d'habitation on main residences has been phased out for most households since 2023, but may still apply to second homes or furnished tourist properties in certain communes, particularly in high-demand areas such as ski resorts and the Côte d'Azur where the surcharge on second homes is actively applied. Check the position for your specific commune.

RECORD-KEEPING AND SUPPORTING DOCUMENTS

Whether you are on micro-BIC or réel, and whether you use an agent or manage independently, you should retain the following documents for a minimum of six years:

• Annual rental statements from your management agent (relevés de gérance)

• All rental contracts or booking records (for self-managed lets)

• Bank statements evidencing rental receipts

• Invoices for all deductible expenses (management fees, insurance, maintenance, etc.)

• Mortgage statements showing annual interest paid

• Copies of filed tax returns and avis d'imposition (tax assessments received)

• SIRET registration and any correspondence with the DGFiP or INPI

The DGFiP has the right to audit (contrôle fiscal) up to three years after the relevant declaration year, and in some circumstances further back. Maintaining complete records protects you in the event of a query.

KEY DEADLINES AT A GLANCE

At Halle International, we support our clients throughout the full purchase journey: from development selection and reservation through to handover. We can make introductions to English-speaking notaires, specialist French property lawyers, qualified and regulated currency brokers  and cross-border tax advisors, ensuring that every element of your transaction is handled by the right professional.

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