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January 2015, very important update:  the “tax” component of the capital gains tax (CGT) on French second home is now 19% instead of 33% for tax resident of non EEE country  since the 1st of January 2015. Therefore the rate is now the same as for tax residents of EEE including France (EEE=European Union + Norway+ Iceland). Overall CGT rate including the social benefit charge is 34.5% for all taxpayer whether they live in France or anywhere else abroad. This was officially voted by the French Parliament at the end of December 2014.

Please read our very important update: “important capital gains tax reduction

The capital gains tax calculator/software has been updated with new features, to give more information and insights about how the tax is calculated. You can now directly calculate your potential tax with the excel spreadsheet embedded in this post. You only need to fill in the yellow cells (see explanations under the spreadsheet). You need to use the mouse or touchpad or touchscreen, do no click to “enter” once you key in the data but just move to another cell. You can use the scrollbar on the right to move down and up. If you would like to receive the calculator you may write to fap@alps-property-france.com or you can download it through the link (be patient as it takes some time to access) and click to “download the calculator on French property capital gains tax” :
http://www.alps-property-france.com/#!useful-tools/cl5u

You only need to fill in the yellow cells (between lines 1 and 10). All explanations are provided between lines 65 and 90. It might happen that the acquisition costs (notaires fees and stamp duties) that you paid when acquiring the property were higher than the 7.5% flat rate on line 5, in this case you can add the difference above the 7.5% on the yellow cells on line 6. Otherwise the yellow cell on line 6 should only include the estate agent fees (if not already deducted to the selling price) and the fees for the compulsory technical certificates (e.g.: energy performance, “Loi Carrez” etc…).
The yellow cells on line 10 for refurbishment should be expenses abiding by the explanations on lines 74 to 78. If you have not undertaken any refurbishment, the tax authorities still apply a 15% refurbishment flat rate as long as you own the property for more than 5 years (calculation on line 13).
If by mistake you enter numbers outside of the yellow cells, you need to refresh the page and start again.

On line 25 there is the amount of taxes and social contributions to pay to the French state for a EEA resident (European Union, Norway, Iceland). There are 3 scenarios:

  1. “previous tax rule”: amount that you would have paid before the changes of the capital gains tax implemented on the 1st of September 2013
  2. “new calculation including 25% rebate”: amount that you pay between the 1st of September and the 31st of August 2014 (update: the 25% rebate was effectively terminated at the end of August 2014), calculation as per the changes implemented since the 1st of September including the exceptional 25% rebate. There are 2 columns as within a year you will have own the property for another full year leading to further tax rebate.
  3. “new calculation excluding 25% rebate”: amount that you will pay after the 31st of August 2014, when the exceptional 25% rebate will be terminated

However, in all 3 cases above, the additional tax above Euros 50 000 capital gains (after rebates) is calculated for one seller only.

Between lines lines 30 and 62, you will find the breakdown of the above calculation, the calculation for a non EEA resident (see lines 81 and 82 for further comments) and the calculation for 2 sellers (e.g.: a couple or partners) concerning the additional tax above Euros 50 000:

  1. between lines 30 and 39: calculation of the tax components (19% for EEA residents and 33,1/3 for non EEA residents, January 2015 update: it is now 19% instead of 33.1/3% since the 1st of January 2015). Non EEA resident calculations is on line 39, please ignore this line after the 1st of January 2015.
  2. between lines 41 to 46: calculation of the 15.5% social contribution (same whether you are a EEA or non EEA resident). You will have to pay the social contribution, however, you should know that there is a case court at the Europe Court of Justice to challenge the fact that the non French resident have to pay the social contribution
  3. between line 48 and 51: calculation of the additional tax above Euros 50 000, if one seller
  4. Line 53: total tax and social contributions for a EEA resident (and if one seller in case there is an additional tax above Euros 50 000)
  5. Line 54: total tax and social contributions for a non EEA resident (and if one seller in case there is an additional tax above Euros 50 000), please ignore this line after the 1st of January 2015.
  6. Lines 57 to 59: calculation of the additional tax above Euros 50 000, if two sellers (e.g.: a couple…)
  7. Line 61: total tax and social contributions for a EEA resident (and if two sellers in case there is an additional tax above Euros 50 000)
  8. Line 62: total tax and social contributions for a non EEA resident (and if two sellers in case there is an additional tax above Euros 50 000), please ignore this line after the 1st of January 2015.

The calculation is the same as the previous version that was released in August, however, the 25% rebate has been applied from the 1st year instead of the 6th year (it seems that our previous calculation was too conservative). The selling fees are also an additional feature.

You will find all the explanation you need in the post (including how the additional tax above Euros 50 000 is calculated): “Capital gains tax on French property: latest updates and calculations (part 1)”

Update: This capital gains tax reform was fully back up by the French Parliament in December 2013 and validated by the Constitutional Court early January 2014.