IFI exempt property / Taxable net wealth

IFI exempt property

Since January 1, 2018, under the impetus of Emmanuel Macron, the property wealth tax (IFI) replaces the solidarity wealth tax (ISF). This tax concerns people and couples who have a net property heritage of more than 1.3 million euros. What goods are concerned? Can we be exempt? How to calculate your taxable net wealth? Barnes Mont Blanc recapitulates these three crucial points of the IFI.

What is taxable property?

Real estate wealth tax applies to houses, apartments, land, historical monuments and all other real estate built or under construction, as well as undeveloped property. If the property in question is a principal residence, a deduction of 30% is applied. The shares of civil society of real estate investment (SCPI), of civil society of real estate (SCI) and land actions are also taxable. In case of usufruct, the taxable share is assumed by the bare owner and the usufructuary.

IFI and exemptions

Certain real estate may be partially or fully exempt:

  • Furnished rentals: total exemption for all goods governed by the professional furnished rental status (LMP).
  • Shops, premises and other professional real estate: total exemption if their purpose is to exercise a professional activity. The activity in question must be the main activity carried out by the owner of the property or by his spouse.
  • Rural goods: partial exemption if they are rented by a long-term lease.
  • Goods from forestry groups: partial exemption of 75%, if the owner agrees to manage and maintain his property over the long term.
  • Paintings and other works of art: total exemption.
  • Company savings plans (PEE), stock savings plans (PEA), securities accounts and other financial investments: total exemption.
  • Shares of non-operator agricultural land groupings: partial exemption.

Calculation of taxable net wealth

If your property cannot be fully exempted at the IFI, you will have to assess your taxable net worth to know the amount of tax payable. To make this calculation, you must take into account two main components, assets and liabilities. The liabilities correspond to deductible debts. These include, in particular, the sums paid for the construction or renovation of your property, certain taxes such as property tax and other debts associated with taxable property actions or the acquisition of property.

Do you want to know if you are affected by the IFI? If you can benefit from a total or partial exemption? Barnes Mont Blanc real estate agents answer your questions and study your file. Our agencies offer personalized support and assist you at each step of the calculation of your taxable net wealth.

Want to go further ? Find out everything you need to know about the assets subject to the IFI for people who reside for tax purposes in France and abroad.

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