Uk resident, uk tax payer, net income tax on holiday rentals on house in France?

We are UK Residents,UK Tax payers and have a second home in France.

My wife lived there for 2 years with the kids while I commuted back in 2014/15 . It didn’t work out, so wife and kids came back to the UK. We still have the house ,and to cover the cost of keeping the house going we rent the house out for summer rentals. It kind of pays for itself at a small loss. So therefore with French income tax, we are :

Non residents, Uk tax payers,receiving income from the summer rentals(6 weeks in the summer holidays)

We declare our income tax with the UK and French authorities. With double taxation agreement and the fact the house is in France we pay our income tax plus social charges in France. If we were to pay income tax in the UK there wouldn’t be any because our expenditure is more than our income,but that’s irrelevant !

What I’m confused about is everywhere I read about income tax in France is that you pay tax on NET INCOME. Every changeover we have ,there is EUR 300 for cleaning,bed linen,gardening and swimming pool. On top, there is wear and tear and extra usage of electricity,gas and water. But it appears from the accountants point of view you declare what you receive and there is no deduction from all the extra expense. Plus we have to pay social charges !!! Btw,we are trying to recoup these social charges which apparently could take forever. Any thoughts or knowledge would be grateful.

Here is the guidance from tax authorities. I think you have a rubbish accountant! You can use regime micro

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Adrian Haines


Let’s just clarify - you are UK Residents, NOT resident here in France ??

@JaneJones Jane - does the régime micro apply to non-Residents ?

We are uk residents. 100%

BIC is just a category of income “ bénéfices industriels et commerciaux” and non-residents use same form so nothing to say they can’t. Of course if in doubt ask your tax office (I think that phrase needs to be turned into a jaunty jingle as so useful).

I was not aware that non-residents could become French Micro-bic. That certainly opens up all sorts of possibilities for the world and his wife… :thinking:

I’m not an auto-entrepreneur so not 100% on this, but declaring BIC income in the right place on your tax form isn’t the same as setting yourself up as a micro-entrepreneur, ie a self-employed person.

I’m just wondering if this is yet another example of it being useful to speak with the French Tax folk face-to-face.


Adrian - do you come over to France from time to time ??? and could perhaps arrange an appointment to talk things through… during such a visit ???

I do. Probably 3/4 times a year . Coming to clear up after this years holiday rentals in a couple of weeks. Lots of work to do . Yikes

There you go then, make an appt and have a chat.

There are some set-ups which allow a flat-percentage deduction towards costs and others which allow actual-costs. It all depends… and is important to know which you can do and how…

roughly what part of France is your property??

Very simple, get yourself on the micro regime where you get an automatic 71% allowance for costs and pay tax etc on the balance.

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I may need to edit my original post. I believe that maybe there is a 50% flat rate deduction of the 20% income tax through the regime micro, which refers to expense deductions, but to be honest I can’t get my head round it.

It’s set out in the link I gave above. I’m presuming that you haven’t had your holiday home classified (stars, wheat ears, whatever) so this is the para that will apply. I think there is a way some people have managed the 71% reduction without being classified but not sure how (I use a different approach). So you just pop the relevant amounts in the relevant boxes and tax will only be applied on the reduced amount of income, ie just on 50% of the income.

Si vous êtes loueur en meublé non professionnel :

  • indiquez lignes 5ND, 5OD ou 5PD le montant total des sommes que vous avez encaissées (loyers, charges facturées au locataire et provisions pour charges) pour vos locations hors location de chambres d’hôtes et meublés de tourisme. Un abattement forfaitaire de 50% (avec un minimum de 305 €), représentatif de charges sera automatiquement appliqué.

If you are a non-professional furnished renter:

indicate on lines 5ND, 5OD or 5PD the total amount of the income you have received from your rental property (rents, charges invoiced to the tenant and provisions for expenses) . A standard reduction of 50% will be applied (with a minimum of 305 €).

Thanks Jane.
Correct. We haven’t had the holiday home classified.
I think what you have said is how the accountant declares it for us,but it’s good to know and see exactly what is required and get different peoples opinions. It’s all a learning process. Unfortunately my French is pretty poor. Always been good at maths and poor at languages :roll_eyes:
I kind of understand the 50% approach but our expenses are high as we are not there to manage it and a few things have gone wrong with extra wear and tear like the pool pump and the water boiler. We do have a very good maintenance guy which has been a saviour, but he needs paying !

You could talk to your accountant about declaring regime réel instead, ie the real income and outgoings. But you would have to keep exact paperwork, no guesswork allowed. And it will be hard to allocate eg electricity and water use to the period of the rentals if you don’t have someone to record the meters.

Others may have found a nifty way round this.

Could you get the holiday maker to pay direct to the changeover team of what we pay them or is that tax avoidance ?

No idea! But on the micro-bic regime you are paying tax on turnover, and that wouldn’t change so your tax wouldn’t change. And on regime réel all it would do would be to increase your perceived profit so your tax would increase.

So not sure what benefits you would get from this, and possibly a big headache if someone didn’t pay.