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IN BRIEF
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Taxation on seasonal rentals is undergoing significant changes, with increasingly strict regulations aimed at regulating this sector. This new legislation is likely to increase taxation on rental income, making investment in furnished tourist accommodations less attractive. However, there are effective strategies for navigating these changes and optimizing your tax situation. This article presents three key approaches to circumvent the tightening of taxation.
Optimize the choice of tax regime
The choice of the applicable tax regime for your seasonal rental is crucial. Currently, two tax regimes dominate: the micro-BIC regime and the real regime. The micro-BIC regime allows for a 50% allowance on rental income for seasonal rentals, which can be advantageous for low revenues. However, if your expenses exceed this allowance, the real regime becomes a more interesting option.
By opting for the real regime, you can deduct all your expenses (maintenance costs, loan interest, insurance premiums, etc.), potentially even canceling out your taxable profit completely. This can significantly reduce your tax burden and, in some scenarios, mean you pay no tax on the rental income received.
Anticipate regulatory changes
Regulatory changes are happening rapidly in the seasonal rental sector. Therefore, it is essential to stay informed and anticipate these developments to adapt your business model. For example, some cities restrict the number of rental days allowed per year, or impose strict energy performance criteria, such as thermal standards.
It is recommended to follow local municipal decisions and sign up for alert platforms to stay updated on new rules. By complying with localized requirements, you can avoid financial penalties and continue to operate your property profitably. Obtaining an approval for your rental can also work in your favor, both on a fiscal level and for the valuation of your property.
Get your furnished tourist rental classified
Another effective method to reduce the impact of the new taxation is to have your property classified as a furnished tourist rental by an official organization. This classification can not only entitle you to tax deductions but also strengthen your position in the highly competitive short-term rental market.
Classified properties often benefit from better visibility on rental platforms, thereby attracting a wider and potentially more lucrative clientele. Moreover, official recognition can reassure clients about the quality of your offering, increasing the chances of booking. With a 71% allowance under certain conditions, this classification can significantly lighten your tax burden.
In summary, the overhaul of taxation on seasonal rentals calls for a quick adaptation of investment strategies. By wisely choosing your tax regime, anticipating regulatory changes, and opting for official classification, you can navigate this new fiscal environment more smoothly.
