How to claim expenses on my rental property in France?

Banking & Financial Tax & Social charges
1

I am filling out a form 2042, but I don’t see where / how to claim the expenses I have incurred. Is there another form to use? If so, what is it?

2

Are you resident or non resident?
December is a strange time to be filling in a French tax form isn’t it?

3

Hi Diana

It’s some years since I had a rental property… but form 2044 rings a bell…

4

I am a non-resident.

5

I thought non residents are given a flat rate allowance for expenses. Could be wrong but I thought that if you wanted to claim actual expenses, you have to register as a French business?

6

Diana …

The property I was renting out was unfurnished and I chose to use Form 2042K plus Form 2044, to allow me to claim for major expenses. I had to stick with this regime for 3 years, but it worked out well in my case.

It might not suit everyone to go the Form 2044 route.

7

Thanks very much. I’ll check on this option.

8

Thanks. That’s an interesting concept. Let’s see what other people say.

9

It really does depend on 1. If your rental property is furnished or not and 2. Your annual income from renting.

This will dictate the tax regimes available to you, the correct forms to complete and the relevant tax rates, deductions and allowances.

10

Thanks, Simon

Do you mean I need to speak with a tax accountant about it? If so, do you have one to suggest?
I can tell you it’s unfurnished and the rent is 600 euros a month. 7200 euros a year. And I’m an American, living in the states.

11

Hi again Diana

Based on the info you have provided - unfurnished property, income less than 15,000€ pa and US resident - then you have a choice:

Either the simple Micro Foncier regime: Enter your gross revenue (without any deductions) into box 4BE in Section 4 of the main 2042 declaration. An automatic allowance of 30% of this gross income will be deducted (without any justification paperwork) - leaving you with your taxable amount of 5,040€. This figure would then be liable to a non-resident flat rate of 20% income tax plus 15.5% social charges as you are a non-EU resident. Therefore total tax of 1,789 € which works out at an overall 24.8% tax on your gross rental income.

Or… you can opt to be taxed under the Foncier Réel regime for a period of 3 years. This would mean you completing form 2044 (detailing allowable expenditure with supporting documentation which may need translating) and carrying forward the results onto form 2042. The same tax rates as above will apply to the resultant net taxable income.

You just need to decide which route suits you best (30% flat allowance versus actual supported and allowable costs) and for that - you should seek professional advice.

12

Oh Simon,

This information is exactly what I was seeking. I really appreciate the time you took and the thoroughness of your response. It is incredibly helpful. I have the names of two professionals to contact. If you have any to suggest (as well), that would be the cherry on top! Thanks again.