Particularity of income from the rental of furnished accommodation: they are taxed in the category of industrial and commercial profits (BIC), and not in that of property income. The interest? Up to 77,700 euros in rent per year, taxpayers can benefit from a simplified tax regime, the “micro-BIC”.
This regime exempts them from keeping accounts. It is the tax administration which is responsible for determining their taxable profit on a fixed basis, by applying a reduction to the rents declared. This principle also exists in the “micro-real estate” regime, for renters of unfurnished accommodation, but it is only possible to benefit from micro-real estate for rents of up to 15,000 euros per year.
In addition, this scheme only offers a 30% reduction, compared to 50% for the micro-BIC. With the micro-BIC therefore, furnished rental companies only pay income tax and social security contributions (17.2%) on half of what they receive. Those who have their furnished tourist accommodation “classified” can benefit from a 71% reduction if they do not receive more than 188,700 euros in rent per year. And are therefore only taxed on 29% of rents.
An amendment adopted by the Senate and integrated “by mistake” to the finance law for 2024 as part of the use of article 49-3, during the second reading of the bill in the National Assembly, modified this tax regime for furnished accommodation. It lowered the rent threshold not to be exceeded to benefit from the micro-BIC regime from 77,700 euros to 15,000 euros, and reduced the rate of the flat-rate reduction from 50% to 30%.
Additional allowance
These changes only apply to short-term rentals – long-term rentals are not affected. And only unclassified furnished accommodation is concerned. “Classified furnished tourist accommodation continues to fall under the limit of 188,700 euros and to benefit from the 71% reduction”, confirms Valentine Roulin, manager at the Arsene firm.
The finance law for 2024 also grants them an additional reduction of 21% (i.e. an overall reduction of… 92%) when the housing rented is not located in a geographical area characterized by a significant imbalance between supply and demand for housing. The condition: not having received more than 15,000 euros in rent, all furnished rental activities combined (short and long term).
These new provisions apply from the 2023 income tax, that is to say to the rents collected in 2023, to be declared in spring 2024. For renters of unclassified furnished tourist accommodation having collected more than 15 000 euros in rent, this change requires a move to a real tax regime. This implies that they must reconstruct their taxable profits a posteriori by deducting their expenses for their actual amount – which requires having kept a record of them.
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