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Changes to the taxation for home improvements

Written by: Bridgewest

Changes_to_the_taxation_for_home_improvements.jpgA new legislative reform regarding home improvements will now make it mandatory for property owners in France to disclose any modifications brought to the building for the purpose of taxation in the following year. This measure aims at allowing for a better determination of a property’s true value and will also increase the income received from local councils from the taxes due for property improvements. Our French law firm can offer you assistance if you need more information on local rates for property modifications.

Higher taxes for building works

Until this year, home improvements and alterations that amounted to an increase of the rental value of no more than 10% were exempt for revaluation. A new rule that enters into effect starting this year makes it mandatory for home owners in France to disclose any changes to the property made throughout the year and pay the due taxes the following year.
Major improvements include extensions to the original building, installing central heating, sanitary facilities, attic conversion and interior remodeling. Property owners in France who perform such changes must notify the authorities in within 90 days in order to benefit from a relief from the increased rates for two years. However, this exemption applies under certain conditions.

Property taxes in France

Certain work for home improvements do not require a permission, but it is possible for those who fail to make a notification of the change to become subject to a fine. Changes to the value of the property made as a result of external environmental changes are subject to a consultation made by the local council. Taxes are applied in France for home improvements because such changes will generally increase the rental value of the property and, in turn, will cause increases in the rates payable.
The two local property taxes in France include the taxe d’habitation and the taxe foncière. For other information about legislative changes for property owners in France, like the tax exemption for second homes, you can contact our attorneys in France.


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