Confusion over French holiday lets after tax rules tightened in error

Amendment lowering tax reductions for short-term lets was not removed from 2024 budget law which was forced through parliament

Those who rent out properties using AirBnB and other short term rental platforms may be impacted by the changes
Published Last updated

A drastic change to tax advantages for holiday letting has apparently been passed ‘accidentally’ after a Senate amendment was left in the 2024 budget law unintentionally.

Several media have referred to this as a change to an ‘Airbnb’ advantage, in reference to the fact a lot of holiday letting is done via this well-known company’s site.

However government sources have been quoted to French news agency AFP saying the change will be rectified legally again as soon as possible - which may not be until the 2025 budget law - and will not be applied in the meantime.

The amendment refers to reducing a micro-Bic expenses allowance for furnished short-term holiday lets to just 30% (50% in areas deemed not to have housing pressures) and with an income ceiling to benefit from this regime of only €15,000, which would align the taxation with the micro-foncier regime for unfurnished rental.

This goes far beyond original government proposals which only sought to reduce certain benefits for holiday lets classified under the star-rating system where these are located in areas deemed to suffer from housing pressures.

It was proposed they should have only the usual 50% micro-Bic expenses allowance, as applied to other furnished letting, as opposed to a generous 71%.

Usually, letting eligible for the 71% allowance can benefit from this regime up to an income of €188,700 and letting on the 50% rate up to €77,700.

However, when the bill was forced through the French parliament using the controversial article 49.3 – which allows certain bills to be passed without a vote – the government appears to have forgotten to remove a Senate amendment, which was noted in the text pushed through as being in conformity.

The amendment will technically come into force after the 2024 budget law (loi de finances 2024) is published in Le Journal Officiel.

Read more: What is France’s article 49.3 and why is it back in the news again?

It is unlikely however that the taxation changes will be enforced due to the brevity of the rule change and the government’s desire to change it, but nonetheless it is still being seen as a small victory by those seeking to regulate the laws surrounding short-term letting.

Parliament committee on the matter in January

Regardless of the accidental nature of these changes, taxation reform for short-term lets is something many politicians have been calling attention to.

Although the Senate is majority-led by right-wing parties, the stricter taxation rules were adopted in their reading of the bill.

One of the senators who put it forward, Ian Brossat (himself a member of the French Communist Party) said: “Nothing justifies paying more tax by renting your home to a worker all year round than by renting it to a tourist on Airbnb.”

Many left-wing parties and figures, and even some members of the government’s own centrist party – have been angling for reforms on the matter.

Housing Minister Patrice Vergriete says he supports “a reform of the rental tax system for private lessors,” but that the government must be “cautious” about doing this and that a parliamentary enquiry is set to make a report about it.

The issue is likely to also come back next year with a bill about housing issues expected in January.

Related articles

MPs propose further crackdown on short-term rentals on France

How Paris plans to crackdown on second homes and empty properties