What deductions are allowed?

You can deduct from your estate various financial obligations that existed on January 1, 2026.

They must be obligations on the main taxpayer or someone in their household for this tax and should relate to relevant taxable assets. Deductible debts include outstanding:

• Liabilities related to acquiring property or property rights; eg. the remaining value of a mortgage and the related interest

• Costs of improving, building, rebuilding or enlarging

• Costs of acquiring shares, pro rata to the amount of these shares that represent investment in property and property rights

• Maintenance costs incurred with regard to property that you rent out, including those incurred for the benefit of a former tenant that have not been reimbursed by December 31 of the year the tenant left

• Taxe foncière and other taxes related to property ownership
  This does not include the tax for rubbish collection that is often included on the Taxe foncière bill. Either work out what you will be billed for in 2026 or use 2025’s figures and make a regularisation payment or deduction next year if necessary. Taxe d'habitation payments are excluded as they are deemed not directly linked to property ownership.

• The 2026 IFI bill can itself be deducted from the final total (this means it needs to be calculated twice).

You cannot deduct debts related to types of property that are exempt from the wealth tax. For types that are partially exempt you may only deduct debts in the same proportion as the part of the property’s value that is taxable.

Loans taken out with members of your own tax household, directly or via companies, or with a company that you control, are not deductible debts unless you can show the loan was made under normal conditions as to interest, repayment deadlines etc. 

Similarly debts contracted by a firm that the taxpayer controls to acquire a property that was formerly the taxpayer's – or expenses related to such property – are not deductible.

There are specific rules related to fine loans (where only the interest is repayable during the life of the loan and the capital at the end of the loan period).

In such a case only a fraction of the capital borrowed may be deducted, proportional to the number of years left to run in relation to the total loan period.

To obtain the deductible figure, you multiply the loan amount by the number of years elapsed since the loan was given and then divide this by the number of years for which the loan was given. For example, an in fine loan of €150,000 over 10 years, made five years ago, allows for a deduction of €75,000.

In the case of people with properties and property rights exceeding a value of €5 million (before deduction of debts related to them) and where the expenses in a given year exceed 60% of the value, only half of the amount of the debt that exceeds the ceiling may be deducted.

You can consult a full official list of deductions at this link