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Legal and Tax

 

Notaire

 

Every property transaction has to be drawn up by a notaire (Lawyer)

 

Who is the notaire?

 

  • The notaire is a public officer
  • He is an impartial arbitrator of the agreements

What is his part in a transaction?

 

  • He draws up the legal transaction or deeds. It means that he gives the seal of authenticity to the identity of the signatories, on the content of the agreement of the deed, and assures their date. He guarantees the morality and the validity of the contracts.
  • He will keep the original deed indefinitely.
  • He is in charge of all the administrative formalities.
  • The notaire has an obligation to advise and inform parties of the extent of the responsibilities that they are undertaking and in choosing the legal form that is best suited and on the consequences of their commitment.
  • He is bond by professional confidentiality.
  • He verifies and point out the town planning restraints.
  • Each client is free to make his notaire intervene without an increased fee.
  • The upkeep of the notaires's accounts is subject to very strict rules in order to guarantee client's deposit.

 

 

The notaire's fees

 

These fees include:

 

  • Taxes paid to the Government. Stamps duty.
  • The "déboursés", which represent the amount paid by the notaire in order to obtain essential documents and papers for the security of the deed.

 

More on the notaire's fees:

  • The professional fees are strictly regulated and fixed by order.
  • The total amount of the notaire's fees is around 7% on old property and 3% on new property of the price of the property subject to transaction.
  • The notaire's fees have to be paid by the buyer.
  • Before proceeding to the signing of the deeds, the notaire has to request the payment of an approximate amount for the payment of the fees.
  • At the end of the transaction, the notaire has to give to his client a detailed breakdown.

 

 

Note: IFL jointly works with offices of bilingual notaires.

 


For additional information please contact us at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

 


Purchasing taxes

 

Property Tax (Taxe Foncière)

 

Only property owners in France pay this tax.

This tax is due even though the property is inhabited, providing it is furnished and habitable. Tax is also payable on land, regardless as to whether or not it has been constructed.

This is the tax you pay as a landlord. It varies from one area to another, from one property to another (size).New or restored buildings are normally exempted from this tax for the first two years after purchasing the property. It is payable even if it is a second residency.

The tax will have to be paid at the end of the year and it is advisable that the landlord employs a French accountant to take care of fiscal matters, such as declaring your income and paying the taxes.

 

 

 

Local Tax (Taxe d'Habitation)

 

The tax you have to pay as an individual living in a community (water, electricity, waste collection...).

It varies from one area to another and is computed on the basis of the property rental value.

This tax is paid by anyone who lives in the property in France on the 1st of January, either the owner or the tenant. The town where the property is located levies this tax. This tax is usually payable at the end of the 2nd quarter of each year.

 

 

 

Rental Income Tax (Impôt sur les Revenus Locatifs)


In France, it represents 25% of your net rental income, i.e. the gross rent less your expenses (maintenance, charges, property tax, local tax, mortgage repayments...).

If your expenses exceed your revenues (gross rent) you are not liable to rental income tax.

 

Capital Gain Tax (Impôt sur les Plus Values)

 

Capital Gain Tax (CGT) is payable on the profit from the resale of properties in France.

 

  • Principal Residence: CGT is not payable on the profit made on the sale of your principal residence in France.
  • Second Home: CGT on second homes in France is payable by both residents and non-residents in France. Long and short term gains are treated differently, each depends on the particular situation.There is no CGT to be paid on properties sold after 30 years of ownership since new law applicable since 1st February 2012.

 

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Sales agreement

 

 

A purchase of a property has two stages: first the "compromis de vente" and then, "l'acte de vente" (we will give you the explanation in the next paragraph: the final deed).

We call "compromis de vente" the contract where the vendor is committed to sell a property at an agreed price to the purchaser who is committed to buy.
It takes approximately two months and a half to three months between the signature of the first contract, the sales agreement and the final deed. This delay is necessary in order to settle the various formalities and administrative papers that are essential to the draft of the final deed.

Be careful! : The compromis de vente is binding except suspensive clauses clearly mentioned in the compromis de vente. Deciding not to proceed with the purchase after 7 days of cooling off period will result in a 10% of the purchase cost payment to the vendor.

 

 

2 Choices for the draft of the compromis de vente:

 

  • Without the notaire: it means that you fill out and sign the compromis de vente prepared by the estate agent together with the buyer.
  • With a notaire: the choice we would recommend since he might provide additional advice. He is a specialist and as a public officer, he is a guarantor of the security of the transaction.

 

 

The compromis de vente has to:

 

  • Be conjointly signed by the seller and the buyer
  • Mention the price of the proposed property by the seller and accepted by the buyer
  • Give the accurate description of the concerned property
  • Mention a date (usually two months after the signature) on which one of you will confirm your purpose of buying

 

In addition to the compromis de vente, a deposit of guarantee has to be paid; it represents usually 10% of the total amount of the property. This deposit of guarantee will be paid by cheque or telegraphic transfer made out to the notaire (the notaire of the seller or the buyer). The deposit is kept into an escrow account until the final deed signature date.

 

Note: IFL jointly works with offices of bilingual notaires.

 

Please contact IFL for further details at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

 

 

Final deed

 

A seven days cooling off period starts after the signature of the compromis de vente.

Following these 7 days, should you decide to proceed with the purchase, the notaire will prepare the final deed and call for the funds to be received prior to the signature date.

The amount he will call for covers the remaining of the purchase price + the notary fee.

 

When the notaire has the requested amount, he will confirm the final deed signature date, on which you will conjointly sign with the seller.

 

At this moment, you will be the owner of the property. The notaire will give you a certificate, which proves your purchase and after six months you will receive your title of ownership: "Titre de propriété".

 

While living abroad, you can decide to have all signatures taken care for by your notaire on your behalf. IFL will organise all the necessary documents to be sent to you for apostilled and required signature. The buying process can then all be managed remotely.

 

Note: IFL jointly works with bilingual offices of notaires.

 

Please contact IFL for further details at: This e-mail address is being protected from spambots. You need JavaScript enabled to view it