You have just purchased a house in Brittany with the intention of renting it out. However, you have serious questions regarding second home taxation, particularly concerning seasonal rental income. Not to worry, we are here to dispel your doubts.
Second Home Taxation: Separating Fact from Fiction
Whether you have purchased or are planning to purchase a house to use as your second home, it is important that you dismiss certain misconceptions from your mind, which could dampen your spirits and, above all, negatively influence your decisions.
1. A second home is a financial drain!
FALSE. If the investor is not down-to-earth and reasonably realistic, unpleasant surprises could lie ahead. However, as long as rental income covers all expenses or improvement works are carried out, the buyer has nothing to worry about.
2. The housing tax is different for a second home
TRUE. The housing tax is a tax based on the rental value of the property, not on the owner’s income. It should be noted, however, that income-related caps and allowances do not apply to second homes. Furthermore, if you own a second home, you do not have an additional TV license fee to pay.
3. You can spend as much time as you want in a second home
FALSE. In reality, you must spend less time in your second home than in your primary residence; otherwise, the second home eventually becomes your primary residence, at least from a tax perspective. However, you can use this as grounds to benefit from allowances in the event of significant renovation works, for example!
4. No need to declare rental income from my second home
FALSE. You must declare all income received through rental to the tax authorities. Furnished rental, seasonal rental, regardless of the type of rental involved, declaring rental income is mandatory. Moreover, in the case of seasonal rentals, you must also inform the municipality in which the second home is located to ensure collection of the tourist tax.
5. Seasonal rentals are not profitable
FALSE. In France, a second home is rented on average for ten weeks during high season. This represents slightly more than €10,000 per year. This is more than sufficient to cover maintenance costs and even generate a profit! So, are you still hesitating to buy a house?
