Guide to vacant housing tax in France

Guide to vacant housing tax in France

Vacant housing tax is a tax aimed at penalising owners who voluntarily leave their housing unoccupied.

However, it does not apply to all the municipalities in France.

Reasons for the taxes

There are more and more vacant dwellings, which is becoming an issue for regional planning policies.

According to Institut national de la statistique et des études économiques (INSEE), there were nearly three million vacant homes in mainland France in 2018 – more than 8% of the housing stock.

In order to combat the housing crisis and increase the rental supply, two taxes have been introduced to encourage owners to rent their accommodation.

The two taxes

Taxe sur les logements vacants (TLV)

The taxe sur les logements vacants (TLV) applies to municipalities belonging to an area of ​​continuous urbanisation of more than 50,000 inhabitants.

The list of these municipalities is fixed by a decree dating from 2013.

In these “tense areas” (municipalities characterised by a significant imbalance between supply and demand for housing) the tax is imposed on owners of vacant housing that could have been used for residential use for at least one year as of January 1st of the year of taxation.

You can check if a property is in a tense zone here.

The amount of the tax is calculated on the basis of the rental value of the accommodation, identical to that calculated for the housing tax.

The rate will vary according to the period of vacancy of the accommodation: 12.5% ​​the first year in which the accommodation is taxable and 25% the following years.

For the tax on vacant housing, no tax declaration is to be filed. The taxpayers concerned receive their tax assessment notice in November.

Housing tax on vacant housing

The housing tax on vacant housing (THLV) can be introduced in areas where the TLV is not applied.

It is collected from owners and lessees of vacant housing for residential use for more than two consecutive years on January 1st of the tax year.

The THLV is calculated by multiplying the rental value of the accommodation by the rate of the housing tax applied in the municipality.

This rate may possibly be increased by the Gemapi tax: this is an additional tax to the local taxes applicable in certain areas for the prevention of aquatic risks and floods. As with the TLV, there is no tax return to file.

Exemptions

The accommodation is exempt from taxation if it has been occupied for more than 90 consecutive days during the reference year.

It is possible to prove it by presenting the declaration of rental income, the water or electricity receipts.

In addition, some accommodations are not subject to tax.

These include:

  • Premises that are uninhabitable as they are.
  • Furnished accommodation, such as second homes.
  • Housing that is planned for demolition or significant renovation.

Additionally, the tax is not due when the vacancy is beyond the control of the owner.

For example:

  • The accommodation cannot find a buyer/renter.
  • The accommodation is illegally occupied by people whose eviction has been ordered by the courts.
  • The accommodation is being sold, the vacancy on January 1st results from the time necessary between the preliminary contract and the final sales contract.

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