The respite was short-lived… Financial Account (PLF) for 2024 1, submitted on 27 September 2023 to the Council of Ministers, at this stage did not contain any subject on the taxation of furnished landlords (LMNP). Done: On October 12, 2023, two amendments were adopted that amend the PLF originally submitted. This is not good news for owners who do seasonal rentals.
Tourist rental in government monuments
Furnished accommodation for tourists is mainly allocated by the state, which contributes to a significant reduction in the number of accommodation capacities for long-term rental.
In early October, Housing Minister Patrice Vergriete reaffirmed the government’s desire to no longer prioritize seasonal rentals and align taxation on furnished tourist accommodation, traditional furnished accommodation and empty rentals.
Advantageous force reduction
Today, an owner who rents furnished tourist accommodation classified by an authorized body (from one to five stars) benefits from a flat rate discount of 71% under the micro-BIC scheme up to EUR 188,700 from the rent received (beyond this, he can no longer use the micro-BIC scheme -BIC and must declare their rental income in real mode).
“So if he receives a rent of €10,000, he is only taxed on €2,900 in his tax bracket,” notes Jedéclaremonmeublé.com (JD2M), a platform that supports furniture rental companies in the various formalities that need to be met.
Taxation that will be less attractive
An amendment by MPs from the Horizonty and relatives group adopted on October 12 proposes a modification of these reductions. Therefore, for furnished tourist accommodation that is not classified or classified with less than three stars, the reduction would only be 30% up to €15,000.
On the other hand, renting a furnished tourist accommodation classified at least three stars, a country cottage or a guest room would entitle you to a 60% discount up to €100,000.
“The aim is to encourage owners to improve the quality of accommodation offered while maintaining a satisfactory tourist offer. In addition, maintaining a larger reduction in this case is justified because the amount of fees for this type of rental is really much higher than for long-term rentals,” explains Mallory Boutron, head of the tax department of Jedéclaremonmeublé.com.
Adjustment of the calculation of capital gain on the sale of furnished tourist accommodation
Another amendment proposed by Jean-René Cazeneuve, rapporteur of the PLF 2024 and accepted by the finance committee, plans to re-incorporate the depreciation deducted in the calculation of the capital gain from real estate for LMNPs who made furnished tourist rentals.
Today, when a LMNP owner sells the accommodation they have been letting as furnished, it falls under the property capital gains regime for individuals, which is a real advantage.
“In effect, the taxable capital gain is equal to the difference between the sale price and the purchase price of the accommodation after certain adjustments, but without taking into account the depreciation carried out during the lease. However, if he opted for the real tax regime during the years when he operated a furnished rental business, he could deduct most of his expenses from the rental income, but also depreciate the value of the accommodation, Jedéclaremonmeublé.com explains. platform. In practice, this allowed him to reduce his taxable income, or even reduce it to zero, and thus not pay taxes on the rents received. »
The amendment envisages the reintegration of depreciation deducted for the calculation of capital gains, as is the case with professional furniture hire (LMP). “If PLF 2024 is voted through with this amendment, LMNPs who opt for the true tax regime will see an increase in their taxable capital gains by choosing to rent to tourists rather than permanent residents in vacant or furnished rentals. So this measure should really encourage owners to abandon tourist rentals in favor of traditional rentals,” believes Mallory Boutron.
1 It must be received no later than December 31, 2023.
2 They are part of the text presented to the National Assembly on October 16 in open session, despite its rejection by the Finance Committee last weekend
Good news for those who rent out part of their residence
The Finance Bill Amendment (PLF) 2024 proposes to extend until 31 December 2027 – with it due to end on 31 December 2023 – the tax exemption for owners who rent out the furnished part of their main residence as guest rooms. In fact, they are exempt from income tax on the income received, provided that the amount of this income does not exceed €760 including tax per year.
Furthermore, owners who rent furnished one or more rooms in their main house to a tenant who establishes their main residence there or has a seasonal contract may be exempt from income tax on the rent received, if the rent is set at a reasonable amount. limits.
“This exemption, which essentially focuses on renting to students, is currently only planned until July 15, 2024. In order not to reduce the supply of student housing for the coming school years, the amendment adopted the intention to extend this exemption until December 31, 2027, which is good news,” analyzes Mallory Boutron from the Jedéclaremonmeublé.com platform.