Taxation: your other obligations as a furnished rental company

As a furnished rental company, professional or non-professional, you must complete certain formalities.

What are the other obligations for furnished landlords?

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Registration

Whether you rent professional or non-professional furnished accommodation, you must register.

In the first fifteen days following the start of your activity, you must subscribe to a declaration of business creation or start of activity electronically on the business formalities desk (GFE): formalites.entreprises.gouv.fr or on procedures.inpi.fr.

This approach will allow you :

• to obtain a SIRET number ;

• to make known the existence of this activity ;

• indicate the tax regime you have chosen.

The fixed corporate contribution (CFE)

Furnished rental is considered a professional commercial activity taxable for business property tax

Even if you are not a company but an individual, you are nevertheless liable for the CFE.

Exemptions are nevertheless provided:

• general exemption :

• Turnover or revenue less than or equal to €5,000 (article 1647 D of the CGI)

• occasional rental, which is not intended to be repeated, of part of your personal home (main or secondary) ;

• rental or subletting of part of your main home at a reasonable price to a tenant or subtenant who makes it their main residence.

• exemption except by deliberation of the local authorities where the furnished accommodation is located:

• rental of all or part of your personal home (main or secondary residence) in furnished tourist accommodation ;

• rental or subletting of all or part of your personal home (main or secondary residence) for other cases.

The contribution on added value of businesses (CVAE)

Furnished rental companies are subject to the CVAE under common law conditions, as long as they are subject to the CFE and their turnover exceeds €152,500.

Exemptions by operation of law or due to deliberation of local authorities, provided for in matters of CFE, apply under the same conditions to CVAE.

Furnished rental companies subject to the CVAE must make a declaration electronically, no later than the 2nd working day following May 1.

It is specified that for the CVAE, electronic declaration and electronic payment are obligatory.

VAT

Furnished rentals are exempt from VAT, with the exception of:

• accommodation services provided in classified tourist hotels, classified holiday villages, classified tourist residences or residential tourist villages;

• services of provision of furnished premises carried out for consideration and in the usual manner, comprising in addition to accommodation at least three of the following services, provided under conditions similar to those offered by accommodation establishments of a hotel nature operated in a professional manner: breakfast, regular cleaning of premises, provision of household linen and reception, even if not personalized, of customers.

• rentals of bare, furnished or furnished premises granted to the operator of an accommodation establishment which meets the conditions set out in the 2 cases above ;

• accommodation services provided in certain residential tourist villages, when the latter are intended for the accommodation of tourists.

It is the lessor who must pay VAT on the price of the furnished rental, but he can in principle include it in the amount of the rent.

There is a VAT exemption on furnished rentals subject to this tax, when the total rent received by the lessor during the previous year does not exceed the threshold of 82,800 euros (excluding taxes).

The VAT rate is 10% on the rental price of the accommodation; however, the provision of accommodation in retirement homes, establishments for disabled people, hostel accommodation, housing for young workers, vocational rehabilitation centers and reception centers benefit from the reduced rate of 5.5%.

All possible additional services (breakfasts, laundry, telephone) must be invoiced in addition at the VAT rate specific to them.

Renters must declare rentals subject to VAT to the tax department responsible for the rented accommodation, within fifteen days of the rental.

However, when due to the amount of rent, the lessor benefits from a VAT exemption, he is exempt from declaration.

Sources: impots.gouv.fr and Ministry of Ecology

Taxation: your other obligations as a furnished rental company