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PETIT IMMO N°79: WHAT TAXATION ON VALUE GAINS IN FRANCE?
Selling a property: what are the capital gains tax rules in France?
The good news is that selling a property doesn't always mean paying a lot of tax. But it all depends on the type of property and your tax situation.
In France, when a property is sold for more than its purchase price, the difference constitutes a capital gain. This capital gain may be taxed, except in certain cases.
Primary residence: total exemption
This is the best-known—and most advantageous—rule.
If you sell your primary residence, you pay no capital gains tax, regardless of the amount of the gain. Whether you have earned €10,000 or €200,000, the capital gain is completely exempt.
However, this exemption does not apply to second homes, rental properties, or land.
Second home or rental investment: regulated taxation
For other properties, capital gains are generally taxed at:
• 19% income tax
• 17.2% social security contributions
For a total of 36.2%.
A surtax may even be added if the capital gain exceeds €50,000.
But there is an important mechanism at work: time is on your side.
Less tax over time
The longer you hold onto your property, the less tax you pay:
• After 22 years, you no longer pay income tax.
• After 30 years, you are completely exempt, including from social security contributions.
In other words, the length of ownership is a key factor.
What about foreigners who own property in France?
Non-residents—for example, British, Belgian, or American citizens who own a vacation home in France—are also impacted by this tax.
In theory, they're subject to:
• A tax rate of 19%,
• Social security contributions (with specific rules depending on their country of residence, particularly for residents of the European Union).
International tax treaties can prevent double taxation in their country of residence.
In some cases, sellers residing outside the European Union must appoint a tax representative in France.
The notary takes care of everything
Good news: you don't have to do anything special. The notary calculates the capital gain and deducts the tax directly when the deed of sale is signed.
You therefore receive the net amount after tax.
Plan ahead before selling
Capital gains tax may seem burdensome, but it depends heavily on:
• the type of property,
• the length of ownership,
• your tax residence,
• and the amount of profit made.
My professional advice:
Before selling a second home or rental property, an accurate estimate will help you avoid surprises and sometimes optimize the timing of the sale.
