Renting Out Rooms in Your French Home
Tuesday 09 March 2021
Renting out rooms in your French home is free from income tax, social charges and business rates, although not for holiday lettings.
These concessions are accompanied by the usual plethora of small print.
- Furnished - Firstly, the room must be furnished. There are different systems of taxation and law for furnished and unfurnished property, so the regulations make this a clear condition of exemption.
- Principal Residence - Secondly, the room must be the main home of the tenant, so letting out rooms on an occasional basis to visitors and holiday makers would not meet the criteria.
- Home - Thirdly, the rooms must be clearly located within the main home of the landlord. So, if you have a gite in the grounds of the property and let this out, it would not be eligible under these rules.
Finally, the exemption is also subject to the rent being ‘reasonable’, a test that is satisfied by ensuring that it is no higher than the maximum figure set by the regulations each year.
For 2021, the maximum rent outside of the Ile de France is €141 per m², while within the Ile de France it is €191 m².
Accordingly, if you let out a room of 20m² in the Ile de France the maximum rent you could charge would be €3,820 per year. Outside of the Paris region it would be €2,820 (€235 per calendar month).
If you let above these levels, the whole of the income is taxable.
In addition to the rent, you can also impose a charge for other services. They might, for instance, include a charge for laundry, cleaning, telephone or internet. These charges are freely negotiable.
Provided these conditions are met, French tax officials have confirmed to us that you do not need to declare the income on your annual French income tax return. As a result, there is also no imposition of social charges or business rates.