Phew… the suggestion was that TVA was payable on the purchase price… Which was unexpected. I’ll be doing most of the work myself so I’m not that concerned. I appreciate that CGT will kick in and my own works won’t be deductable… But as we know, we are not expecting to make a profit.
Frankly, I think the talk of TVA is due to the fact that your thread is about a project. Paying an Enterprise/Artisan 5% TVA instead of 20% TVA on a Bill can quickly mount up to serious savings.
It can be a fine-line between having an Enterprise/Artisan and doing things yourself. There is not only the financial aspect to consider, but the 10-year Insurance the E/A must have - covering the work and the product.
If you are doing major works yourself - plumbing/electricity/waterworks/insulation/roofing - whatever - you will need to be sure that everything conforms to French “normes” (current at the time of your build).
Of course, if you are intending to stay in the finished project for a good 10 years - the lack of 10-Year Insurance (in itself) will no longer matter when you come to sell - even so, it might well be necessary for everything to be attested as OK, as Brits are known to often do things “their own way” which can be a headache for the new owner.
2 Likes
Hi Stella,
Thank you for your council on this. Whilst it is an advantage to use local artisans for the works and 5% TVA is a significant incentive. Using such artisans must be weighed with the legendary costs associated. It is well known that french building contractors are very expensive. Clearly there is a balance of opinion here, but if I am wearing my financial hat on, I would recon self works whilst paying TVA at the full rate for goods purchased is going to pay off every time.
I also think we are going off topic here (fascinating as the conversation is).
For some works it’s not just the decennial insurance of using local artisans, and TVA, but also affects resale. You could find it more difficult.
1 Like
Hmmm, yes I have heard that, but I think its doubtful to be honest. The type of house I will build will seldom attract locals. Neither will the location. So lets recap…
You won’t make a profit.
Its really difficult to get good builders and contractors…who are expensive
Notaires fees typically are 10% of cost price
if you sell it within 5 years CDT kicks in and you will die
No-one will buy it.
You will be broke and your mind shattered.
But…
in 30 degs
Du vin, du pan, du manchego
1 hr away from the med
Sorry guys. you are not putting me off. However forewarned is forarmed and all your comments are very helpful.
1 Like
Try and live to see the project finished … 
Let’s recap:
You need to consider the Project to be for your own pleasure - not for profit.
You need to use good, local builders - unless you can do an excellent job yourself.
Notaire’s Fees - are unavoidable - so bite the bullet
No CGT on Main Residence - so live there and enjoy life.
You will be broke - mind shattered - but exhilarated
3 Likes
Hi Darren,
Beware the generalised advice that the French housing market works differently to the English market - the basic laws of supply and demand apply here as much as they do in England. There is often a different mind-set in French buyers and sellers but they are still subject to the basic laws of economics and the psycology of the market.
I know people who have made good gains on property development in France by design (and enjoyed the process) and as many who have not.
If you buy in the middle of nowhere with no prospect of improvements in the local economy then spend more then the average price of local property on renovations a gain on the property is very unlikely. But the same is true of the UK, or Croatia, ot Spain, or anywhere else.
If you buy at the right price in an area that has good prospects forthe local economy and manage the project well then gains are just as likely. I think you know that already.
The art and science are in recognising the possibility, the realities, and managing the situation, which you seem to be more than capable of doing.
I wish you luck in finding someone with good local knowledge.
From what I have seen and heard of… if one is hoping/planning to buy-and-sell at a profit, it is best to buy in the guise of “company”, then the accounting is very different and “profit” is part and parcel of the exercise.
“in the guise of a company”.
Not sure I get you?
Aren’t we all buying and hoping to sell for a profit ultimately? if not could I please have there Names and Addresses? I have a 3 year old BMW I’d like to sell for 150K.
Buying a second home is a big financial commitment. Sure the market is different, but you don’t throw out your financial skills by crossing a border.
Buying offshore through a company has UK corporation tax implications. How does pretending to buy as a company improve matters? What advantages does it offer?
1 Like
Well you already have my name, I don’t give my address to strangers ! 
I bought here because I wanted to live in France and make my home here. The money I have spent on my house will never be recouperated…but I love my house and enjoy living here. When it’s time to sell then it will be with a heavy heart and a financial loss but so be it !
3 Likes
Sounds like you think people are trying to put you off. They aren’t they are just being realistic
2 Likes
I did not mean pretend - I am just not sure which “designation” of Company would apply.
Builders who do new-builds and/or renovations will buy and subsequently sell at a profit. That is their business, with every expense offset - this is not possible as a private person.
If a Company is set-up as a Renovator or whatever it is… they too can offset expenses.
A person buying a ruin - does so at his own whim - making it habitable (to whatever level) is not seen as an investment. Thus, in the majority of cases, any money spent on a Second Home is not deductable against the Selling Price when figuring profit - CGT crashes in and the Seller weeps.
No-on is saying that you do - however there is a larger gulf in France between a “do upper” with a view to profitable resale and one for a quiet retirement than there is in the UK.
Hi Nellie,
Are you suggesting that all the sweeping generalisations here are somehow realistic for every individual case?
I’d ike to understand how that happens.
1 Like
Can’t we have both, Paul, if we are careful about what we buy and how we renovate?
1 Like
I daresay but the key - as you said earlier - is to have that plan from the outset and to be very careful in your choice of property and location.
OK, it’s a generalisation, but a lot of Brits want to buy in a quiet rural location because you can get a huge amount for your money property-wise but that is because, often, there isn’t much demand from the French - there are areas within the UK which are in pretty much the same boat (except no-one wants to retire to them 
).
It’s not just Brits who loose out - the (French) guy we bought from bought the house in 2007, spent over 50k€ on it and wound up selling to us for 10% less than his original purchase price, never mind the 50k€ 7 years later. My French wasn’t (and isn’t) good enough to have asked him whether he bought as an investment but I think that he did - probably on the top of several years strong growth in prices but he came quite badly unstuck.
As long as you go in with eyes open, do your research and have a firm & realistic view of your goals and buy appropriately things should be fine.
1 Like
French young couple - inherited some money and went mad renovating/improving their home. They now tell me that when they sell to move back South - they will aim at the Brits - 'cos Brits are the only ones with enough money to pay what they will be asking. 
2 Likes
Oh I am so sorry I didn’t realise this is some sort of fight I thought you had joined looking for advice
4 Likes