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A Cautionary Tale!!


galtezza
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If anything will curb the enthusiasm of those looking to buy an old property in France to turn into gites, as per Househunting in the Sun programmes.... then this will.

We bought an old farm for just under 200k; five old rundown buildings - no fosse septique, but running water and electricity to one house.

Plan was to live in one house, renovate the other, and turn two barns into gites. The other larger barn would stay as a barn, but have an internal pool for gite guests. All this was to be completed on a small budget and be done over 5-10 years, with the income from each gite when completed, contributing to renovating the next one.

We thought we had done all our homework, spent months on forums; checking costs, asking all the right questions to the immobiliers. We knew that we would have to pay higher than UK immobilier fees (€15.000) and we had accounted for the notaires fees including taxes (€14.000).

We had also budgeted for the architects fees which were also steep at €11.000. We also knew that we would have tax d'habitation and tax fonciers to pay - but as the habitable part of the farm was so small, these taxes would be minimal initially.

We also enquired whether there were any costs associated with planning permission and were told no, this would be free - there would be a cost for the SPANC man to design a solution for the fosse septique system, but this would be c€150.

Well - how far away from the truth, could that advice have been.

First we were hit with the Tax Local d'équipement, which was a staggering €7700. It is a tax payable when your receive your planning permission, based on the value of the additional habitable space you are requesting... which is calculated on a % of the value of the additional space - anything over 170m2 being valued at €711 per m2! Obviously big old barns have a lot of m2 and at €711 per m2, tot up to a massive amount.

It was payable in two parts €5300 payable 12 months after planning permission was granted, and the other €2400 12 months after that.

No-one at any point in the 9 months we were requesting planning permission mentioned this tax. Not the architect; the notaire; SAFER who were buying through; or the immobiliers..... no-one.

Having just gotten over the shock of this huge bill; we have now had the coup de grâce.

We have now been sent a further Avis D'Impositon (a bill) this one is for 'Redevance d'archéologie préventive' and is for a further €4800 and must be paid in the next 4 weeks!!!!!

I have looked this up, and apparently it is a separate tax payable if your planning permission is accepted, for any construction that includes excavation? at least that it how I translated it... and is payable on any planning permission over 1000m2.

This is unbelievable. I now have a tax bill for €12.500, for a group of rundown barns, and a house with no toilet or heating. And this was supposed to be a planning process with no costs. I can't afford to start work on the place as I am too busy trying to pay taxes on plans that may or may not ever come to fruition!

I have no idea if this is the last of the taxes that I have to pay..... I thought the T.L.E. was the final cost, until this new one came through.

I don't know if there is anything else we will have to pay, just because they said yes to our plans.... I sincerely hope not.

But for those people looking into buying an old place to renovate and hopefully set up a couple of gites to bring in a bit of income - I think the phrase 'Buyer Beware' is appropriate.

Set aside a big chunk for taxes, even though everyone tells you there is no cost to getting planning.... its just not true

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It is a shame you had not been given the correct advice. We came here with the same intentions as you 7 years ago. I am pleased to say we were aware of all the taxes required. We finished the house and three gites and the swimming pool in 2008 and have had 4 great seasons with really good income.

We intend to retire and sell our gite complex next year and are looking to have a house built in the village.

Don't be put off. Its great fun running gites. Hard work yes but the rewards outweigh all the bad bits.

Hope it all works out.
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Not sure we will ever get that far 602.

If you were aware of all these taxes, did that include the Redevance d'acheologie préventive?

Do you know if there are any other taxes still to come...?

I don't think the budget can withstand any other surprises...
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If I asked once I asked a hundred times about what we needed to budget for,the truth is that they don't know what we don't know and did not mention the taxe d'equipmente either.

So I am not surprised you were not told, I am surprised you were 602.
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We have emailed the architect to ask why the SHON is so high, thus making the taxes so high. He has included a barn with an indoor swimming pool as habitable space - is that right?

No-one can live there as it will be a barn still - it will just have a heated indoor pool in it, for gite guests to use in the winter.

Has anyone else got this?
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[quote user="galtezza"] He has included a barn with an indoor swimming pool as habitable space - is that right? No-one can live there as it will be a barn still - it will just have a heated indoor pool in it, for gite guests to use in the winter.[/quote]

Logically it seems correct, you cannot live in a garage yet it is still counted as a habitable area for the tax calculations.

You could actually live in a garage should you choose to, I live in a garden shed in the UK, but a swimming pool? Is yours big enough to take a yacht? [:D]

Maybe it would not be imposable if it were built with one end open to the elements, you could quietly close it off later with those folding curtain wall door jobbies.

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Thanks guys, yes the architect has confirmed that the barn with a pool in it, is classed as habitable space - strange as a barn with hay in it (which if I were pushed to sleep in, would seem far more comfortable than the bottom of a pool!) is not included.

Not sure I will ever understand the logic to this planning system.

We will try to investigate if this latest bill can be paid in parts, as the renovation is to be completed in parts - does anyone know if this will in turn, cause us more problems?
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[quote user="galtezza"]Thanks guys, yes the architect has confirmed that the barn with a pool in it, is classed as habitable space - strange as a barn with hay in it (which if I were pushed to sleep in, would seem far more comfortable than the bottom of a pool!) is not included. [/quote]

I would think that a barn with hay in it would be classed as a working area but an ex barn (cannot still be a barn as it is not being used as such) with a pool in it is living area

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[quote user="galtezza"]Thanks guys, yes the architect has confirmed that the barn with a pool in it, is classed as habitable space - strange as a barn with hay in it (which if I were pushed to sleep in, would seem far more comfortable than the bottom of a pool!) is not included. Not sure I will ever understand the logic to this planning system. We will try to investigate if this latest bill can be paid in parts, as the renovation is to be completed in parts - does anyone know if this will in turn, cause us more problems?[/quote]

It is a tax not plan subtlety;

It is based on the valeur locative as stated above, not difficult to translate. But in essence a pad with a swimming pool will have a greater rental value.

Oh my dawg I didn't read your postings correctly! I see your pool-in-barn is a free callifragilistic addition to your gite complex with NO additional price tag.

Vous me tirez les poils!!

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[quote user="602"]I think the answer is to work from that basis i.e. that you know nothing. To be honest most French don't know much about these issues either.[/quote]

yes i agree, we were fully aware that we knew nothing. I had a list of 'knowledge' everything we were told to budget for and asked and asked there was anything missing, the builder, the notaire even at the bank and everyone else we knew and no one told us at all. This is common.

We even knew about getting insured during the build, and our french neighbours didn't know about that. I suppose because it has been mentioned on here and is on the internet then people do have better ways of finding out these things these days,

I could not have done more that is for sure not in the early 80's.
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  • 2 months later...

[quote user="idun"]If I asked once I asked a hundred times about what we needed to budget for,the truth is that they don't know what we don't know and did not mention the taxe d'equipmente either. So I am not surprised you were not told, I am surprised you were 602.[/quote]

Someone correct me if I am wrong - but isn't the taxe d'equipement payable in two halves, one on permission being granted and the other on completion of the work??

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[quote user="Bobdude"]

[quote user="idun"]If I asked once I asked a hundred times about what we needed to budget for,the truth is that they don't know what we don't know and did not mention the taxe d'equipmente either. So I am not surprised you were not told, I am surprised you were 602.[/quote]

Someone correct me if I am wrong - but isn't the taxe d'equipement payable in two halves, one on permission being granted and the other on completion of the work??

[/quote]

 

Ours was 30 years ago and I had asked if we would be a charge for planning permission and was told we would not. The bill arrived, probably about the autumn after we moved into the house and was to be paid in two parts, so well over a year after the planning permission had been granted.

Ours was a new build.

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Personally I would not put a pool in a barn as it wont help your letting potential in the summer and if your planning on heating it for winter lets then hang on for your heating bill !

Just cross it off your planning application and then apply separately for an inground outside pool later, this used to not need planning permission just a declaration at the marie (this may not now be the case) This may reduce your tax bill in the short term
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