Property tax is a tax collected cadastral rental value of the property. Its calculation is complex and is based on several factors. The cadastral rental value is primarily determined by the tax services and corresponds to the theoretical rental value of the property, i.e. the rent that the property could generate if it were rented out. This rental value is regularly reassessed to reflect developments in the real estate market.
Once the cadastral value of the rent is determined, it is subject to a reduction, which varies depending on the nature of the property. For example, main residences benefit from greater discounts as a second home or uninhabitable property. In addition, certain exemptions may apply depending on the geographical location of the owner or the use of the property, such as an exemption for those over 75 or for rural properties rented out on a long-term basis.
After allowances are taken into account, the net rental value is multiplied tax rate set by the municipality where the property is located. Each municipality has the power to set its own tax rate, which means that property tax can vary widely from municipality to municipality. In addition to the municipal rate, it can be additional rates set by other local authoritiessuch as department or region.
Finally, the property tax may also be accompanied by various additional taxes and fees, such as tax for household waste collection or business premises tax. These taxes are generally calculated based on the cadastral rental value of the property.