I bought via firm - what is French tax position?

In the 1990s I retired in the UK, then was rehired as a contractor but had to set up a limited company. In 2001 we bought a French village house but the purchase was made through the company name. It is owned by myself, my wife, two sons and three grandchildren, with me now having a minority share. I am now in my 80s and if we need to sell the house and change to a bungalow, rather than having a lot of stairs, how do we stand for French tax? D.L.

30 November 2018

On any sale of the property, as a company asset, it would be taxed within the company, which may cause issues if the company no longer has any income and would not be able to pay the capital gains tax.

The principal private residence exemption may not apply if the objects of the company have not been changed to accommodate the possibility of holding a private residence.

However, the tax due would be different whether the company was liable to corporation tax or the business profits liable to income tax. In that case some abatements could apply but conditions would apply for these to be granted.

As such, one would advise consulting a professional who can look at the totality of the facts.

Reader's query answered by Hugh MacDonald

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