Are you a gîte owner in rural France? If so then you need to be aware of the changes to the tax regime introduced during 2016. The definition of what is considered a “rural gîte” has been unclear in legal terms and the changes introduced under the new General Tax Code attempt to remove any perceived tax advantages. The changes will also effectively encourage owners to register as a meublé de tourisme classé or become a micro-entrepreneur.

Until this year, rural holiday gîte owners have been taxed under a system called the ‘micro’ (or ‘forfait’) which provided for significant tax exemptions and benefits: for example, a cost allowance of 71% against rental income meaning that tax is liable on only 29% of income; and secondly exemption in rural development areas from the Cotisation Foncière des Entreprises (CFE). Under the new General Tax Code changes, these preferential tax advantages will no longer apply with the cost allowance reduced from 71% to 50%.

To continue to receive the 71% cost allowance it will be necessary to apply for classification under the meublé de tourisme. There are a range of government approved organisations which are authorised to issue a star rating, which will require payment of an application fee, responding to questions about the property and facilities available and finally making the gîte available for inspection. Gîte owners receive a star rating which they can decide whether to use or not: and it will allow you to retain the tax advantages (71%) previously available.

There are however alternatives. Individuals owning gîtes could become classified as a micro-entrepreneur (previously known as auto-entrepreneurs) or can decide to be taxed on the basis of your actual net profits which is called the régime réel. If you would like to explore either of these alternatives please contact us and we shall be pleased to advise you.

The above is a summary of the principal changes but if you would like to know how the tax changes affect you as a gîte owner then please give the team at Fiscaly a call on +33 (0)9 81 09 00 15. You may also wish to visit our website http://www.fiscaly.fr/ . Let Fiscaly help you to take away the headache of tax and administration.

Millions of people living in France stand to benefit from recently announced tax reductions in 2017 and with a Presidential Election just around the corner next spring, the aim is to help single person households, couples and families with children. See below to determine whether you could benefit.

Income tax reduction of 20% for 5 million households

Around 5 million households could benefit from a 20% tax reduction, estimated to be worth 200€ on average and based on 2016 incomes. The income earned limit is 18,500€ for a single person or a widow – that’s around 1,700€ a month. For couples, the ceiling is 37,000€. However it is possible that some people earning slightly more than these limits could receive a partial tax reduction.

Introduction of tax deduction at source in 2018

From 2018 the Government will be changing the way it collects tax by deducting at source with employers sending the tax deductible direct to the state as opposed to completing an annual tax return each autumn. Those households who do not pay tax and earn less than 25,000€ will not be affected by this change.

Increase in the TV license fee in 2017

Watching TV in France will be more expensive next year… but only by 2€. The changes have been introduced to raise money for public sector broadcasting and will increase to 139€.

Extension of the Home Care Tax Credit to all Retirees

Finally, good news if you’re retired and need to access home care services. From 1 January 2017 the Government will apply a 50% tax credit in return for the employment of an employee at home. Previously this benefit was available only for those working or unemployed but has now been extended to retired persons, including those who do not pay tax.

Please give the team at Fiscaly a call on +33 (0)9 81 09 00 15 or visit our website http://www.fiscaly.fr/ if you would like to know more about how we can help take away the headache of tax and administration.

Calculating and paying taxes is always difficult – or is certainly not easy – however the French view it as their way of contributing to their national and local government and guaranteeing their way and quality of life.

But even though we’d all prefer to keep our hard-earned money in our pockets, paying tax is what we have to do and for many people submitting a tax return is at best a chore – and for those who are not confident in the French language, can be positively daunting. However, submitting your French tax return need not be a stressful experience and that’s where we come in.