, , , , ,

The French Parliament has recently validated the stamp duty increase as we already inferred in our post of the 8th of August “French stamp duty to rise soon, likely to be offset by downward property price trend”.  However it will be implemented from the 1st of March 2014, when stamp duty on a French property may increase from 5.09% to 5.79%.

Although each French “département”* may choose to apply or not the stamp duty increase, we can expect that an overwhelming majority will do so. Technically the “Conseil Général” (local council for a “département”), may vote in favour of the increase from the 1st of January 2014, but the increase is implemented 2 months after the vote, so no earlier than the 1st of March.

All final acquisition contract (“acte de vente”) signed after the 1st of March will therefore bear the new stamp duty fees at 5.79%

The stamp duty increase is due to be “temporary” and should go back to 5.09% from the 1st of March 2016. January 2015 update: the French Parliament has recently decided to turn it into a permanent increase! Please  read our post “where the stamp duty has increased from 5.09% to 5.80% as of January 2015“.

If you are about to sign a preliminary acquisition contract (“compromise de vente” or “promesse de vente”**) you may consider speeding up the signing process as the time lag between the preliminary contract and the final contract is generally 3 months, especially if you are applying for a mortgage. However, if in January or February you figure out that you may go over the 1st of March, it might be wise to check the date when the stamp duty increase is to be implemented, as a few “départements” may slightly lag behind in implementing the increase. Your “notaire” will be able to advise you.

The increase in French stamp duty, will bring the overall property acquisition costs (notaire fees included) to approximately 8.45% for a  Euros 95 000 acquisition price and 7.12% for a  Euros 600 000 home.Please read our post “Buying a property in France: “notaire” fees and acquisition costs” for further detail.

 *France is divided in approximately 100 “départements

** Read our post “Buying or selling property in France: “compromis de vente” or “promesse de vente”?”