Letting a furnished holiday home
Whether it’s your holiday home or an investment property, if you want to let a furnished holiday home, you must register this activity and apply for a SIRET number.
There are two main options: the « LMNP », the non-professional option or the « LMP », the professional option. In this article we will only go over the « LMNP » non-professional option.
What is a "LMNP" holiday rental ?
« LMNP » stands for « Location Meublée Non Professionnelle » : Non Professional Furnished Rental. This rental status is very common if you are renting a furnished holiday home or long-term furnished rental. You can register as a non professional if :
- Your annual turnover is below €23.000
OR - Your annual turnover doesn’t exceed 50% of your household income.
When should I register as a LMNP?
When you decide to let a furnished holiday home, whether it’s year-round or as a holiday rental, you must register and obtain a SIRET number. If you meet the criteria mentioned above, then you can register as a Non Professional Furnished Rental. Otherwise, then you must probably register as a “Location Meublée Professionnelle”, a Professional Furnished Rental.
You must register from the first day you intend to rent your property out. You can do this on the INPI website or get in touch if you need assistance.
How will this rental income be taxed?
Whether you are a French resident or not, you will have to do a French Tax declaration for this income. Taxation will depend on your situation and eventual choices. With the new “Loi Finances 2024”, the game has changed! Here’s the most recent information, that applies from 2024 onwards. For 2023, you can opt to stay in the previous taxation system or move to the new 2024 one.
If your furnished holiday home is “unclassified”.
“Micro-BIC regime”: you can opt for this if your annual turnover is below €15,000. This is a very simplified option: you declare your annual turnover on the form 2042 C PRO and a 30% abatement will be applied (considered to be expenses). You’ll be taxed on the remaining amount.
“Régime reel”: you can opt for this if your annual turnover is below €15,000, it is automatic above this threshold. With this option you’ll deduct expenses from your turnover and be taxed on the net profit or deficit. You’ll have to declare the net figure in the form 2042 C PRO and will also have to complete the form 2031-SD. Assistance to complete the forms is generally required in this situation.
If your furnished holiday home is “classified” from 1 to 5 stars.
In France, it is possible to “classify” holiday rental properties, from 1 to 5 stars. If you decided to classify your property, this could be a tax advantage. If your property is classified you can benefit from the “Micro-BIC” regime up until €188 700, and the abatement is in between 71% and 92%! Here is the taxation information depending on your situation :
Turnover | < €15 000 | €15 000< X <€188 700 | > €188 700 |
Régime MicroBIC option | 92% abatement* | 71 % abattement | NO |
Régime reel | Possible | Possible | Mandatory |
* This is 92% if your furnished holiday rental is located outside of a “zone tendue”, meaning “tense area, high-demand zone”. If your rental is located in a zone tendue, then the abatement will be of 71%. You can check the location of your property here.
Like previously, you will have to declare your income on the tax form 2042 C PRO. For the “Régime reel”, you will also have to complete the form 2031-SD.
You can read up about the recent changes on the official government website.
How much tax will I be paying?
How much tax you’ll be paying will depend on your personal and professional situation. The taxable income (turnover after abatement if Micro or benefit/deficit if the Régime Réel), will be taxed according to the Tax table (read this article about tax returns in France for more detail). You’ll also have to pay social charges : 17.2% of the turnover after abatement or 7.5% if you are a non-resident.
If you are planning to rent out a furnished property or are already doing this and need help with the admin, drop me a message and I’ll get back to you!
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FAQ
Where must I register to get a SIRET number?
To get a SIRET number you must register with the INPI.
When and how must I declare my income?
Every year, when tax season begins (around April and until end of May or beginning of June) you must complete a Tax return, whether you are resident or not. You must do this online on www.impots.gouv.fr or fill in a paper form if it’s your first income declaration.
Will I pay social charges on this income?
Yes, 17.2% social charges or 7.5% if you are not a French resident.
After obtaining a SIRET number, is there anything else I should do?
If renting a holiday home then it is mandatory to declare this to your local town hall. You must also update your “Déclaration d’occupation de bien” on your Impôts account. Alson once your SIRET number is issued you must create an online Professional Impôts account.
What’s a classified furnished rental (meublé de tourisme classé)?
In France it is possible to classify holiday rentals from 1 to 5 stars. Read up about this here, on the official website.
Is my property in a “zone tendue” (“tense area”)?
Click here to check if your property is in a “Zone tendue”.
Resources :
- INPI, Portail e-procédures
- ATOUT FRANCE, Le Classement des Meublés de Tourisme
- RÉPUBLIQUE FRANCAISE, Impôt sur le revenu – Revenus d’une location meublée
Throughout this article there are links with extra ressources.