Taxation of rental income: the principle for non-residents
Under French tax law, French-source real estate income is taxable in France, regardless of the owner's place of residence. This is the principle of fiscal territoriality. An expatriate living in Dubai who rents out their Parisian apartment must therefore file a tax return in France every year.
The minimum tax rate applicable to non-residents is set by Article 197 A of the French General Tax Code (CGI). For a tax resident outside the European Union, the rate is 30% of net property income. For a resident of the EU or the EEA, the minimum rate is 20%. These rates apply only if the rate calculated on all French-source income is below these thresholds — otherwise, the higher effective rate applies.
Available filing schemes
Depending on the nature of the property let (unfurnished or furnished) and the amount of rent received, the applicable tax regime differs:
- Unfurnished letting — micro-foncier scheme: available if gross annual rent is below €15,000. Flat-rate deduction of 30% on rent. Simple and requires no supporting documentation for expenses.
- Unfurnished letting — actual expenses scheme: mandatory above €15,000 or optional below. Deduction of actual expenses (loan interest, works, service charges, management fees). Form 2044.
- Furnished letting — micro BIC scheme: flat-rate deduction of 50% (or 71% for classified tourist rentals). Threshold of €77,700 in receipts.
- Furnished letting — actual BIC scheme: deduction of expenses and depreciation. LMNP status (non-professional furnished lettings) available to non-residents subject to conditions.
Deductible expenses and tax optimisation
The actual expenses scheme allows a wide range of expenses to be deducted from gross property income, significantly reducing the taxable base:
- Loan interest and bank charges related to the property
- Maintenance, repair, and improvement works
- Property management fees (letting agent, building manager)
- Insurance (non-occupant owner, rent guarantee)
- Property tax (taxe foncière)
- Legal costs in case of dispute with the tenant
Agent or tax representative: who handles it?
For non-residents, two solutions exist to manage the filing obligations relating to rental income:
- Tax agent: a professional or trusted third party appointed to file the property income return in France. A suitable solution when appointing an accredited tax representative is not legally required.
- Accredited tax representative: mandatory only in the event of a real estate sale exceeding the €150,000 threshold. Can also handle rental income as part of a broader mandate.
In all cases, using a professional familiar with non-resident real estate taxation helps avoid regime errors and optimise the amount of tax payable. Consult our list of accredited tax representatives to find an expert in the situation of non-resident property owners in France.