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Read also our new post on “taxe d’habitation”: “French taxe d’habitation: calculation and explanation on tax statement”

“Taxe foncière sur les proprieties bâties” (TFPB)* is one of the two main local taxes on French buildings and the deadline to pay 2013 tax is getting close…only a few days left.

Who has to pay the tax?

As owner, usufructuary (“usufruitier”), or trustee of a French property, you have to acquit this tax every year.

You will pay the “tax foncière” on your house or flat (including parking allotment) that you own in France, whether you occupy the property or not (e.g.: if you are a property investor and you rent out the property, you still have to pay the tax).

The tax is due for the whole year according to the situation on the 1st of January. Therefore, if you own the property on the 1st of January and you sell the property within the year, you are still liable to pay 100% of the tax for the full year. However, it is possible to insert a clause in the selling deed (“acte de vente”) so that the buyer will refund you the tax pro-rata. But you are ultimately responsible for paying the full tax to the tax authorities, as you were the owner at the 1st of January. If you made improvement to your property, it will be taken into account the following year.

How is the tax calculated?

The tax is calculated by multiplying the rental value (after a 50% rebate) by the rates of 3 local authorities: the city or village where the property is located (“commune”), the group of “commune”, the “département”. The rental value was set up in the 1970ies and is often disconnected to the “market” rental value. However, it is revalued every year and uniformly throughout the country, in 2013 by 1.8%. The government has recently launched a review of the rental value due to be completed in 2016. On the above mentioned calculated tax, the French state charges a 3% management fee (but 8% on “group” of communes), for managing and collecting the tax on behalf of the local authorities*.

Another tax is usually collected at the same time as the “”taxe foncière”: the TEOM (“taxe d’enlèvement des ordures menagères”). The tax is used to finance the collection and recycling of household waste. The calculation is simply the same as for the “taxe foncière”, however there is only one tax rate (either the “commune” or the group of “communes”) and the French state management fee is 8%.

 

Tax exemption and reduction:

Please read our post: “taxe foncière: exemption for new homes and high energy performance”

We may write another post regarding exemption and rebate based on revenue (for people paying their income tax in France) and age.

 

How can you pay? What is the deadline?:

The final deadline to pay the tax is Tuesday the 15th of October 2013, or Sunday the 20th if you pay online.

You may pay your tax by:

  • check (if the tax is less than Euros 30 000)
  • banking transfer (when less than Euros 30 000)
  • cash (if the tax is less than Euros 3 000)
  • Interbank Payment Order ( « TIP » or “Titre Interbancaire de Paiement” in French)
  • automatic transfer at due date. You need to register online before the 15th of October. Transfer will be made automatically 10 days later.
  • online payment:  it is possible to pay online before the 20th October midnight (French hour). However for the first online payment on the tax website (impots.gouv.fr) you need to do the following so do not wait the last day:
    • Indicate your tax reference which appears on the “taxe foncière” statement
    • Specify the details of your bank account to be debited
    • Send to the bank the authorization for online payment, which is available on the tax website
  • payment with your smartphone: by using the soft application on “impots.gouv.fr”. The tax statement has to include a “flash code” on the lower left angle. A flash of the printed code with your smartphone should allow you to settle the tax.

If you pay after the deadline, the tax authorities may charge an additional 10% penalty

 

What happens if you think the tax calculation is wrong:

If you think the tax statement is wrong, you have several ways to make claim, however you still have to pay the required amount on your tax statement before the deadline. You can make a claim before the 31st of December of the following year (e.g. for the 2013 tax due to be paid in October 2013, you can make a claim before the 31st of December 2014).

How can you make a claim in 3 different ways:

  1. You may send a letter with acknowledgement of receipt to the “centre des impôts fanciers” (you need to attach a copy of your tax statement) or pay a visit to the tax center (the address is on the tax statement).
  2. You can make an appeal to the ombudsman for the French ministry of economy and budget (“médiateur des ministères de l’Economie et du Budget” in French) ,by mail at BP 60153, 14010 Caen Cedex 1, par fax au (00 33)02 31 45 72 20 or online www.economie.gouv.fr/mediateur. We advise to send a letter with acknowledgement of receipt
  3. IF following step 1/, the tax authorities do not agree with your claim, you can go to court (to the “tribunal administratif”) within 2 months following the receipt of the letter from the tax authorities. It is possible to go to court and make an appeal to the ombudsman at the same time, however the 2 months time lag to go to court once you received the taxman letter is independent to the appeal to the ombudsman. If the tax authorities have not replied to your complain (step 1/) you need to wait 6 months before going to court.

Going through the ombudsman is probably the best of the last two solutions, involving less stress and also less expenses as to go to court it is strongly advised to get the support of a lawyer.

* The “taxe foncière sur les propriétés non bâties” (TFPNB) (tax on land) abides to the same principles as the TFPB, except that the rebate on rental value for the tax calculation is 20% instead of 50%. However there are also specific exemption cases.