How is the property tax distributed for the sale of a French second home?
Question from the reader: I have agreed to sell our property in France. Is the notary pay it land and dwelling taxes once the transaction is complete? Regarding housing tax, I paid a considerable sum the last time when I was over 70 years old. I felt like it had to end at a certain age? ME
Housing tax continues to apply on all properties held as a secondary residence. For main residences, it is removed in two stages.
The first is over and concerned incomes below €27,761 for a single person and €44,211 for a couple. For those whose income exceeds these amounts, the cancellation began in 2021 with a 30% reduction, then a 65% reduction in 2022 and with nothing to pay from 2023.
Other reductions or exemptions, including one for those over 60, also apply only to main residences and only if the declared income is below certain thresholds of modest resources.
Read more: Property tax Property tax in France: what are the exemptions?
With regard to refunds in the year of the sale, it is not customary for housing tax to be reimbursed to the seller since it is based on the person or persons using the property on 1 January of the year in question.
There is also a general principle that you only have to pay tax once, so if the buyer has already paid on their previous home, they shouldn’t expect to pay a second time.
Another problem is that the household income appears on the tax notice for this tax and sellers generally prefer not to disclose it.
Otherwise, if you are not worried about it, you are free to ask for an agreement to reimburse the housing tax based on the last amount paid.
Property tax is also levied on January 1, but on the owner of the property. As this ownership changes during a sale, it is generally the only tax to be partially shared between the two owners during the same tax year.
It is usually refunded pro rata to the year you and the new seller own the property, always based on the latest available valuation.
the notary will therefore request a copy of the last balance sheet for the property tax.
the notary pro-rates the amount you paid or owe (depending on whether the sale takes place before or after you receive the appraisal) and therefore the portion due to you.
Read more: French property: Buyers paying estate agent fees could save money
The tax refund is added to the sale price and paid to you by the notary, which obtains the funds from the buyer.
A copy of the deed of sale is then sent to the tax office with the stamp duty paid by the buyer, and the tax office arranges for the change of the person to be billed for the property taxes.
If the sale of the property takes place late in the calendar year, the tax office may not have had time to change the details of the assessment to be issued after the sale, and therefore you may receive another evaluation “incorrectly”.
If this happens, send it back to the tax office, crossing out your name and adding the words sold, the date of the sale and the name of the new owner.
Find help navigating life in France with our new Reader Questions newsletter
Sign up to receive our selection of Readers’ Questions of the Week answered by Report team – delivered to your inbox every Saturday.
See what other readers like you are asking, including: how often is a rabies vaccine for dogs required for France-UK travel? Can foreign residents benefit from the French pension supplement? and more.
Sign up for a free newsletter
Couple find solution to withholding tax on French second homes when selling a house
Homebuyers in France warned against notary money transfer scam
Buying and selling a home in France: what is life annuity?