The properties of less than 14 sqm, located in municipalities where there is a clear imbalance between supply and demand for housing and where the monthly rent excluding charges is superior to 41,64€/sqm for the year 2017, are in principle subjected to the tax on small surface area apartments.
This tax called “Apparu”, is owed by the owner, natural or legal person, living or not in France. In case of dismemberment of the ownership right, it is payable by the beneficial owner.
Which accommodations are affected?
All of them are:
- unfurnished or furnished rentals for a minimum term of nine months
- of which the living area doesn’t exceed 14 sqm, however the residences providing services such as tourist homes, retirement homes or student residences aren’t subjected to this tax
- located in municipalities identified as located in geographical areas characterized by an important imbalance between supply and demand for housing (area A and A bis: in the municipalities’ list as defined in thedecree of August 1st of 2014 implemented by the article R.304-1 of CCH, modified by thedecree of September 30th of 2014); big agglomerations like Paris, are affected
- and of which the monthly rent, excluding charges, exceeds 41,64€ sqm of living area (threshold re-estimated yearly depending on the rent benchmark index’s evolution)
How to calculate the micro-housing surface area?
It’s the floor area built, after deducting the walls surface area, bulkheads, steps and staircase, ducts, windows’ and doors’ frames, and parts of a height inferior to 1.80 meters (article R111-2 of the French Construction and Housing Code).
The “living surface” is different from the “surface Loi Carrez” since it doesn’t take into account the unfinished attics, basements, shed, porch…
Calculating the micro-housing tax
The tax is levied on the total amount of the rent earnings during the civil year. The tax rate depends on the gap between monthly rent excluding charges implemented by the owner and the standard monthly rent (established by the “loi Alur”). It is as followed:
- 10% if the gap is inferior to 15%
- 18% if the gap is superior or equal to 15% and inferior to 30%
- 25% if the gap is superior or equal to 30% and inferior to 55%
- 33% if the gap is superior or equal to 55% and inferior to 90%
- 40% if the gap is superior or equal to 90%
Example: If an owner rents out a 13 sqm property for a monthly rent excluding charges of 715€ (that is to say 55€ per sqm), he will have to pay the tax.
There will be a 25% rate since the gap between standard rent and rent charged by the owner is 32% [(55-41,64)/41,64] x100 = 32 %.
The owner will thus have to pay a tax of 8580€ (annual rent) x 25 %, so 2145 €.
Declaration and payment of the micro-housing tax
For natural persons, the tax is declared and recovered under the same conditions as the income tax. Therefore, it will be calculated by the tax services on the basis of the reporting income (property incomes for unfurnished rentals and BIC regime for furnished rentals). The tax on rent incomes N, will be declared and paid on N+1. Basically, natural persons have to fill out the form n° 2042 LE (CERFA n°14872) and report the total tax amount on their overall incomes declaration n°2042.
For legal persons, the micro-accommodations’ tax is declared and paid back like corporate taxes. Legal persons have to fill out the form 2576-TSLE-SD (CERFA n° 14813).
The tax is implemented and controlled under the same guarantees and penalties than the income tax or corporate tax. The administration return time finishes at the end of the 3rd year following the year when the tax applies.
Important: This tax isn’t deductible from the earnings that are subjected to income tax, nor from the taxable result subjected to corporate tax, and finally, the more the owners rent out their property at an expensive price, the less they benefit from it.