Furnished tourist accommodation owners are facing attacks on their portfolios. It was a bill aimed at resolving imbalances in areas of tension in the rental market. Approved in the first reading in the National Assembly on January 29, Monday. The text mainly envisages a decrease 30% tax deduction rate It is targeting rental income from furnished tourist accommodation, compared to 71% or 50% today. The goal of this measure is clear: to encourage owners to rent out their homes on the long-term rental market rather than on Airbnb-type platforms.
As a reminder, this reduction in income related to tourist rental They benefit owners who are subject to the non-professional furniture rental (LMNP) tax regime, in the micro-BIC regime. Currently, owners whose income does not exceed 72,600 euros per year can have a tax reduction of 71% on turnover. If the “anti-Airbnb” law carried by Rennes MP Annaïg Le Meur is enacted, this reduction will therefore drop to 30%. Only owners who rent a home in a “very sparsely populated rural” area will continue to benefit from the 71% reduction.
If this tax deduction would fall in the coming months, owners of furnished tourist accommodation would automatically see an increase in the tax applied to their income. But to what extent? To find out, we offer you three simulations made by Olifan, an expert consultant in wealth strategies and investments.
For a better understanding, we have chosen three profiles of real estate owners. Each of them has a marginal tax rate (MTR) of 30%. Social security contributions of 17.2% are added to this income tax. The only consultation is the 6.8% general social contribution (CSG) deductible. Now let’s see what tax increase our owners face when the income deduction goes from 71% to 30%.
Our first profile is based in Paris. He rents out his property on Airbnb for about twenty nights a year, for 250 euros a night. Its rental income is therefore 5,000 euros gross per year, of which 1,450 euros are taxable, taking into account the 71% tax reduction currently in force. If this reduction were to increase to 30%, our Paris owner would see his taxable income rise to €3,500. Income Tax and Social Security fees would then increase to 1,580 euros, compared to the previous 654 euros, which is 926 euros more.
Our second profile is headquartered in Bordeaux. He rents out his property on Airbnb for around fifty nights a year for €160 a night. Its rental income is therefore 8,000 euros per year, of which 2,320 euros are taxable, taking into account the 71% tax reduction currently in force. If this reduction were to increase to 30%, our Bordeaux owners would have their tax revenue reach 5,600 euros. Then, the total income tax and social security contributions would increase to 2,529 euros, compared to the previous 1,048 euros, which represents an additional 1,481 euros.
Finally, our last profile is the owner of a second home in Nice. He rents out his property on Airbnb for around a hundred nights a year, for €200 a night. Its rental income is therefore 20,000 euros per year, of which 5,800 euros are taxable, taking into account the 71% tax reduction currently in force. If this reduction were to rise to 30%, our owner in Nice would see his tax revenue rise to €14,000. Total income tax and social security fees would increase to 6,322 euros, compared to the previous 2,619 euros, which is 3,703 euros more.
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