thehepples Posted January 4, 2011 Share Posted January 4, 2011 In 2003 we bought a wreck in the Gironde. We have spent last 7 years of holidays putting it right with the help, in the early stages, of two English builders based in Lot et garonne for the major work. We have boat loads of photos to show the difference between then and now!We MAY need to sell soon. The house is now worth 150K and we bought at 40K. So I think I need to pay CGT on 80% of 110K (on the taper down after 5 years)?I have 10K of receipts for DIY materials. Are these any use?Also, the builders never sent a receipt for the 25K of work they did. I can get copies of the cheques I paid to them from the bank although I am trying to track them down.All advice / info much appreciated Link to comment Share on other sites More sharing options...
pachapapa Posted January 4, 2011 Share Posted January 4, 2011 I thought the taper down at 10% did not apply to a maison secondaire. Link to comment Share on other sites More sharing options...
thehepples Posted January 5, 2011 Author Share Posted January 5, 2011 No, you do get it. The 15 year rule applies to all property "Fifteen Year RuleIf the property has been owned by you for fifteen years then no capital gains tax is payable on sale, even though it is not, and may never have been, your principal home.Between six and fifteen years an allowance of 10% per year of the gain is granted, so that, by the end of the fifteen years, complete exoneration arises. Thus, if you sell a property after having owned it for a full 10 years, you will be granted an allowance of 50% against your liability to capital gains tax. No exemption is available for a sale under six years. " from http://www.french-property.com/guides/france/finance-taxation/taxation/capital-gains-tax/Its the deductions I'm really interested in Link to comment Share on other sites More sharing options...
thehepples Posted January 5, 2011 Author Share Posted January 5, 2011 No, you do get it. The 15 year rule applies to all property seehttp://www.french-property.com/guides/france/finance-taxation/taxation/capital-gains-tax/Its the deductions I'm really interested in Link to comment Share on other sites More sharing options...
Sunday Driver Posted January 5, 2011 Share Posted January 5, 2011 To obtain CGT relief for the full cost of renovation work, you must produce trade invoices for the work carried out. DIY receipts do not qualify.However, if the sale is completed more than five years after purchase and you cannot produce trade invoices, then you can claim a fixed deduction of 15% of the purchase price. Link to comment Share on other sites More sharing options...
Chancer Posted January 5, 2011 Share Posted January 5, 2011 15% of the purchase price is not quite as generous as the regime that was in place when I bought in 2004, at that time you could multiply all material purchases by 3 and set against purchase tax.Given that to date I have spent nearly double the purchase price on materials, it could be more than double when I finish, I dont have a single artisans facture, and that the property will have increased 10 fold in value you can see that the regular changes in the tax law can make a huge difference to an investment. Link to comment Share on other sites More sharing options...
Polly Posted January 5, 2011 Share Posted January 5, 2011 DIY receipts are not deductible for the calculation of plus-value gains, nor are materials you may have purchased for a registered artisan to do work. His work (whether with TVA or under a micro régime) and any materials he supplies count, so long as you have the factures to prove it, so: You have a new roof, the company supplies all the tiles etc and the labour. The total bill is allowable.You buy a new bathroom suite in the UK and your French plumber installs it. Only the bill for his labour and any materials he supplies are allowable, the cost of the suite isn't.re your builders not giving you a receipt: if you have the bills and the payment ref from your bank (cheque N° and date cleared) that's OK Link to comment Share on other sites More sharing options...
BJSLIV Posted January 5, 2011 Share Posted January 5, 2011 Don't forget that whatever percentage reductions you get in France will probably increase the amount of tax payable in the UK, as you will have less tax paid in France to offset against the liability to HMRC Link to comment Share on other sites More sharing options...
Sunday Driver Posted January 5, 2011 Share Posted January 5, 2011 Also, IIRC, if you've previously obtained income tax relief on artisan installed 'eco improvement' items such as double glazing, you can't put them through again for renovation relief under CGT.....[:(] Link to comment Share on other sites More sharing options...
thehepples Posted January 5, 2011 Author Share Posted January 5, 2011 Chancer, like you we bought when the 3x DIY receipts were allowed! If we sell it is to enable migration to New Zealand. There've been no improvements like you mention Sunday driver. We bought the double glazing from the Bricodepot and installed it ourselvesThanks to all for your contibutions so far Link to comment Share on other sites More sharing options...
Chancer Posted January 5, 2011 Share Posted January 5, 2011 I have long since learned that the as far as taxation in France is concerned the only thing that you can count on is not being able to count on the present situation lasting [:(]I was a couple of years in when I found out about the then new regime, I chastised my friend who had found the property for me for not letting me know, he said that he didnt know either and got the shock of his life when he turned around a property he had bought and renovated from the ground up, he would have been better off demolishing and having the shell of a pavilion built, it as he who first gave me the above advice, others have since including comptable experts, you are paying me for my advice today which may damage your wealth tomorrow etc.Expect things to get even tougher unless you are building a B.B.C. Link to comment Share on other sites More sharing options...
NormanH Posted January 5, 2011 Share Posted January 5, 2011 And the rate has just gone up from 16% + taxes to 19% since the 1rst of January... Link to comment Share on other sites More sharing options...
Chancer Posted January 6, 2011 Share Posted January 6, 2011 Norman, are you under the weather? You said that without the slightest hint of pleasure [:P] Link to comment Share on other sites More sharing options...
P-D de Rouffignac Posted January 7, 2011 Share Posted January 7, 2011 I don't think that spending money on improvements necessarily adds value to a property - that is, on the assumption that I have spent X therefore I should get Y-plus back when I sell. Expensively renovated houses in the wrong location are still hard to shift. In the immortal words of the 'Location, location, location' team 'People searching for a £500,000 house don't want to live in a £200,000 street'. Conventional wisdom is that money (over) spent on bathroms and kitchens is rarely recouped, as are other embellishments reflecting the owner's personal style. New owners like to stamp their own personality on a property. If you are investing to re-sell, then best to remain as neutral as possible and let the would-be purchasers weave their own dreams. P-D de R. Link to comment Share on other sites More sharing options...
thehepples Posted January 7, 2011 Author Share Posted January 7, 2011 Thanks for your input PD R, however I think you missed my initial point. The house was bought as a holiday home for us. We did repairs like install a septic tank, replace knackered windows, install an inside loo. But we did it ourselves and so have NO evidence of the improvements. We are not selling to MAKE money, but because we may be migrating to the other side of the world Link to comment Share on other sites More sharing options...
NormanH Posted January 7, 2011 Share Posted January 7, 2011 Use this to estimate http://www.planete-patrimoine.com/WD100AWP/WD100Awp.exe/CTX_11996-12-dGmwwFBNox/PageTransitModule/SYNC_-1267645967 Link to comment Share on other sites More sharing options...
AnOther Posted January 7, 2011 Share Posted January 7, 2011 [quote user="P-D de Rouffignac"]I don't think that spending money on improvements necessarily adds value to a property - that is, on the assumption that I have spent X therefore I should get Y-plus back when I sell.[/quote]This should be stamped in big red letters on the top of every compromis and Acte de Vent !A British disease...............especially if done badly !!! Link to comment Share on other sites More sharing options...
thehepples Posted January 7, 2011 Author Share Posted January 7, 2011 I would like to thank those of you who HAVE given useful information. You have clarified for me the most recent changes.Less appreciated are the implications that we bought the house as an investment and/or that we've done a botched job on the work we've done and/or we have spent over the odds and/or have questionable tasteWe took a house with major problems - no inside loo, no running hot water, no septic tank, walls with doorways with no lintels - and made it livable. All I wanted to know was whether we were entitled to make a reduction in our tax. Link to comment Share on other sites More sharing options...
debbie Posted January 8, 2011 Share Posted January 8, 2011 Very well said P-D de R. I totally agree. When shopping for homes we often decor that is hideous to us but was obviously beautiful to the owner. Link to comment Share on other sites More sharing options...
Polly Posted February 1, 2011 Share Posted February 1, 2011 Hi Hepples, I've pm'd you with some info Link to comment Share on other sites More sharing options...
AnOther Posted February 1, 2011 Share Posted February 1, 2011 [quote user="thehepples"]Less appreciated are the implications that we bought the house as an investment and/or that we've done a botched job on the work we've done and/or we have spent over the odds and/or have questionable taste.[/quote]I read no such implications [blink] Link to comment Share on other sites More sharing options...
thehepples Posted February 1, 2011 Author Share Posted February 1, 2011 @ Polly. That's the one. Cheers very much.Actually the point is now moot. We are no longer off to NZ as I will fail the medical requirements. Link to comment Share on other sites More sharing options...
Polly Posted February 1, 2011 Share Posted February 1, 2011 Oh well! Keep the info anyway, maybe worth checking it out, you never know....Hope you're not seriously poorly Link to comment Share on other sites More sharing options...
thehepples Posted February 1, 2011 Author Share Posted February 1, 2011 Thanks for your help and wishes. Its not life threatening, just a medical fail Link to comment Share on other sites More sharing options...
chirpy Posted February 3, 2011 Share Posted February 3, 2011 STAY IN GEORDIE LAND AND ENJOY THE WARM FRIENDSHIP!!!AWAY THE LADS!![:D] Link to comment Share on other sites More sharing options...
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