Tax obligations for non-residents renting out unfurnished accommodations

Income you receive from renting out unfurnished property is taxable as property income.

It is declared either under the régime micro-foncier or the actual regime.

The régime micro-foncier

If the gross amount of property income received by your entire tax household is less than €15,000 (not including service charges), irrespective of the term of the rental during the year, you are automatically subject to the régime micro-foncier.

In this case, supplementary property income return no. 2044 does not need to be filed.  

Simply report the gross amount of property income received (amount of rent received less service charges payable by the tenant plus expenses normally settled by owners but charged to tenants plus subsidies and indemnities received) on return no. 2042 (box 4BE). A 30% allowance (fixed assessment of service charges) will be applied to calculate taxable income in the property income category. This allowance will be calculated automatically and should not be deducted.


 

The actual regime

Income you receive from renting out unfurnished accommodations will be taxed under the actual regime if the gross amount of property income received by your tax household in 2020 exceeds €15,000 (not including service charges) or if you opt for the actual regime.

In this case, you need to file:

  • Return 2044, if you are owner of “ordinary” property (including property eligible for special deductions under the Besson and Borloo schemes for existing housing stock)

  • Special return 2044 if:

    • you have opted for the deduction allowing you to amortise the purchase price of new housing

    • you have claimed a special deduction under the Scellier intermédiaire, Scellier ZRR or Robien ZRR schemes

    • you are the owner of “special” property: property classified as a historical monument, property located in a protected sector (or similar) for which you have claimed a Malraux tax break, or property in bare ownership

Important: If you opt for the actual regime, you are locked into this choice for three years, even if it not in your favour in the second or third years.

If you are filing online, return 2044 is available from the list of appendices.

The result calculated on return 2044 or special return 2044 (profit or loss) will then need to be reported on return 2042: line 4BA in the event of a profit and line 4BB or 4BC in the event of a loss.

Taxation of your income at the average rate

If you opt for the average tax rate, you will report your worldwide income (French and foreign sources) so that this rate can be determined. Nevertheless, this rate will only be applied to your French income to calculate the tax.

If you have French and foreign property income, the revenue received for the year will therefore be assessed globally.

Should you exceed the €15,000 threshold for gross property income (not including allowances and service charges), the régime micro-foncier can no longer apply and you will have to opt for the actual normal regime (see below).

In this case, if you file your returns online, you can use the calculation factsheet for your worldwide property income to help you deduct loan costs, and your expenses and service charges concerning property both in France and abroad.

In all cases, you should opt for the average rate and report your global income as only the most favourable taxation method will be applied to you. In this respect, you can consult the “What is the average tax rate? Eligibility” factsheet in the “Your questions/Our answers” section under the “Tax liability and reporting obligations in France for non residents” heading.

Possible waiver of the régime micro-foncier: the actual regime

 Entitlement to the régime micro-foncier may be waived in favour of the actual regime. This option is exercised by filing property income return no. 2044 within the statutory time limit. This option may not be revoked during a three-year period.

In the “Your questions/Our answers” section, refer to the “Renting out unfurnished property: entitlement to the actual tax regime” factsheet under the “I'm non resident and I own property in France” heading.

 

UPDATED DINR-PART on AUGUST 20, 2021