Britons with second homes in France may choke on their croissants when they are hit with their latest property tax bill in the coming weeks.
The French government is ramping up property taxes for owners of holiday homes in popular tourist areas.
Some may find their bill has risen by 60 per cent as President Emmanuel Macron clamps down on second homes in areas where there is a housing shortage.
There are two main property taxes in France, taxe foncière and taxe d’habitation. The taxe foncière is an ownership tax and is paid by the owner of a property, regardless of who occupies it.
The taxe d’habitation, a residence tax, is paid by the occupier. It is like council tax in the UK and is spent on community services. Last year the tax was an average of €772 (£660) for a house and €941 (£800) for a flat.
Townhouse: Kate Cherry and husband Matt, are braced for sharp tax hikes on their four-story property in Occitania, southern France (pictured)
As of 2023, this tax is now abolished for those owning one residence.
But it is still applied on second homes and additional properties so includes Britons who own a second home in France.
It is this tax where a surcharge of between 5 per cent and 60 per cent could be applied in 2024.
Initially, the surcharge was limited to 1,136 councils in big cities and tourist resorts, where last year areas including Bordeaux, Lyon and Biarritz increased property taxes by 60 per cent. For example in Paris, the city council has declared a 51.9 per cent property tax rise.
Now the French government has given an additional 2,263 rural areas the option to roll out increases to the tax by the same amount.
‘The tax rates for 2024 have not been published yet so it’s still a very grey area for homeowners.
There should be some clarity towards the end of the year but there are still a lot of things that are not yet known, or whether the taxes will increase again at some point,’ warns Christophe Du Tertre, a specialist at FranceTax Law.com.
But one thing’s sure: property taxes are rising for second home owners in France, and this will affect the thousands of Britons with holiday properties there.
For example, in Brittany, 156 councils have been given permission to increase the residence tax by up to 60 per cent where about 12 per cent of the region’s properties are second homes. An estimated 8,900 Britons may be hit by the hike in taxes.
Townhouse: Kate Cherry and husband Matt
In eastern France in the Jura region, Lebby Eyres, 52, has owned a second home for the past 11 years with her French husband Fred, a TV producer.
He comes from neighbouring Burgundy, so the pair often stay at the house when they are visiting his family with their two teenage children.
The couple bought the four-bedroom property for €165,000 in 2012 from an 86-year-old woman who had knocked two houses into one. It is still treated as two houses, meaning the tax bill will be higher.
The taxe foncière for the house is due to rise by 11.5 per cent this year, from €1,126 to €1,257 a year.
The couple also pay taxe d’habitation of around €1,100 annually, so pay total property taxes of around €2,000. They expect their total annual property tax bill to rise to around €2,500.
‘It’s a double whammy. We pay the taxes annually, so it is quite onerous to get two big bills near the end of the year,’ says Lebby, who is chief executive of The Health Lottery.
However, she adds that the house is not an investment.
‘We bought it so we can see family and the children could experience French culture, being half French. We may possibly retire down here one day. We would just have to take any tax rises on the chin.’
Kate Cherry, 46, lives in Hertfordshire and owns a four-story townhouse in Occitania, southern France. Kate , who lived in the region when her parents moved there in the 1990s, bought the property with her husband Matt for €350,000.
Connection: Lebby Eyres (pictured at her second home in the Jura region) expects her total annual property tax bill to rise from €2,000 to around €2,500
It is split into four apartments, two of which are let. Another is used by Kate, while the other is used by her parents.
Kate only pays the taxe d’habitation on the one apartment that is used as her main dwelling when she’s in France. She paid €729 last year. Her taxe foncière bill was €3,611 in 2022, about €300 up on the year before.
Kate, regional director at business networking organisation The Athena Network, says there are still question marks over how much second-home owners will see their property tax bills rise. She is expecting her bill for the coming year to land this month.
‘I’m waiting to see what our village does in terms of increasing property taxes because the council is super reliant on tourism and there are a lot of businesses that make most of their money in the summer.
‘I understand they need to make money but clearly I wouldn’t like to see it go up too much,’ she says.
Rising property taxes are a further blow to Britons who are already struggling to spend time in their holiday homes in Europe.
British citizens can no longer spend more than 90 days in EU countries in any 180-day period.
Squeezed: Around 60,000 Britons are estimated to own a second home in France, down by a third from around 90,000 in 2012
About 809,000 Britons own second homes, according to the English Housing survey. Some 60 per cent are in the UK, up from 48 per cent 10 years ago, suggesting more Britons are now favouring holiday homes in their own country.
‘Since Brexit, we are seeing fewer British buyers because there are constraints on how long they can be in the country,’ says Alex Balkin, head of Savills’ French Riviera division.
Around 60,000 Britons are estimated to own a second home in France, down by a third from around 90,000 in 2012.
Susan and Chris Beesley have recently sold a home in France because of increasing bureaucracy and the restrictions on how long they can stay.
Their chalet in the French Alps came with a self-contained apartment in the same property.
Susan and Chris stayed in the apartment during peak ski seasons, while letting the chalet to holidaymakers. They sold the apartment for €300,000 in 2021 and the chalet for €695,000 in 2022.
‘We loved our property but we were impacted by the pandemic, which hit bookings. Also, after Brexit, we could no longer stay out there for the full season and run our chalet business.
We decided to sell up and use the money to invest elsewhere,’ says Susan, 68, a former management consultant who advises others on how to make income in retirement.
The couple were paying around €1,500 a year for the taxe d’habitation and €1,950 for the taxe foncière.
‘I truly believe owning a property overseas is good but you’ve got to go into it with your eyes open and understand how the rules work and that they can change depending on the government at the time,’ adds Susan.
Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.
I am Rakesh Sharma, I associated with Elite News as an Editor, since 2021. I take care of all the news operations like content, budget, hiring and policy making.