Which assets are exempt?

One major exempt category is 'professional assets'. These are properties or property rights that are deemed to be used directly for the taxpayer's paid work of a commercial, industrial, agricultural kind or in a liberal profession.

It can also relate to company shares such as an SCI which represent holdings in the same kinds of properties, as long as they are used for the taxpayer's work or in certain cases for a member of their family's work.

Below we provide a non-exhaustive list of assets deemed exempt. A full list is available on the French government website, otherwise we suggest taking professional advice if your situation is complex.

• Property necessary to do your job (or that of another person in your tax household). This should relate to the person's main paid-for work. This does not include activities concerned with managing your assets, such as managing a share portfolio or renting or letting unfurnished or furnished property unless you have the status of 'professional letter'.

• Property related to work carried out by a company (société) subject to income tax if the taxpayer (or someone in the tax household) earns a living in it as their main work-related activity.

• Property related to work by a company (société) subject to corporation tax, where the taxpayer (or someone in the tax household) works for it and obtains at least half of their work-related income from it, in a director-level position and also directly or indirectly (through their spouse or parents or children or brothers or sisters) holds at least 25% of the voting shares. The latter is not essential if the taxpayer’s shareholding is worth more than 50% of the gross value of their wealth.

Certain rural property (agricultural holdings) may also be exempt under limited conditions even where they do not qualify as 'professional assets', including:

• Those let on long-term leases (including a bail cessible), on condition the property is let for at least 18 years to certain close family members and the tenant uses it for their main work.

Finally, a large number of assets are exempt due to the fact they have no links with buildings or land, such as:

• Furniture and fixtures

• Personal possessions such as jewellery, cars, boats, horses, planes

• Many kinds of stocks, shares, PEPs and ISAs as well as bank accounts, current accounts, premium bonds, cash etc.

• Debts owed to you

• Art and collectables

• Pension fund capital

• Funds from a personal injury claim

• Cemetery rights

There has been debate about including items such as cars, boats, or cryptocurrencies, however such changes are not approved or expected to apply in 2026.

The following assets are partially excempt

As mentioned, a main home in France benefits from a fixed allowance of 30%. Where, for example, a married couple each has their own 'main home', only one property can qualify.

Main homes held via an SCI property-holding company do not qualify but, having said this, the market value of a property for IFI should make allowance for how easy it is to liquidate it, according to France's notaires.

In the case of SCIs, an allowance of 10-20% is generally considered acceptable linked to the difficulty of selling one's shares, the notaires state.

When it comes to properties under construction, the value assigned to these is variable depending on how close it is to completion.

Properties that are rented out to someone else may generally have a deduction of about 20% applied, to account for the fact that the owner cannot readily sell them and does not have them at their disposal, say notaires.

If they are not fully exempt due to being 'professional assets' (see above) the following are also partially exempt:

• 75% of agricultural holdings rented out on a long-term lease on condition that the total value of such holdings does not exceed €101,897 or otherwise exempt at 50% above this limit. The exemption and the amount taxable are worked out automatically by the tax office.

• 75% of the value of shares in agricultural investment schemes (GFA) or in schemes in vines (GFV) on the same conditions.

• 75% of the value of woods and forests or of shares in groupements forestiers (schemes investing in these). To benefit from this the taxpayer must have a certificate guaranteeing that the woods are managed in a sustainable way. The exemption will be calculated by the tax office automatically if these are declared correctly.