selling up in france

[Rob]

Having had a holiday home in France for 7 years, we are selling up.The house is a barn conversion that has only recently been signed of as complete {these things take time }.Does this mean that our house is a new build for notaires fee purposes or not ?.Am I correct in thinking that there are two levels of fee's, one for new builds at 4% and one for existing houses at 8%?

[andyh4]

Don't know the details of you question, but I have an uncomfortable feeling there's going to be VAT to pay as well.

[Gastines]

Best thing to do is to visit a Notaire with your figures written out and ask him/her.. He/She may even give you a bit of advice on how to present those figures and save yourself a few bob,especially if the same Notaire is dealing with the sale.

Bonne Chance.

Regards.5 mins St.Malo

[BJSLIV]

A newbuild is complete from the date that the form is submitted. It means that you will be liable for VAT (18.6%)  on the difference between the receipted cost of the project and whatever you get for selling it.

[Kiras_Back]

As it's a barn conversion then you should have paid 5.5% TVA on the build because it 'should' have fallen into a 'renovation' category rather than a 'new build' as the foundations were there already ...

Being a second home, you'll be liable for CGT, which is 40% and after 5yrs it slides down a scale that was revised in a law about 2yrs ago - I don't know what you'll be expected to pay after 7yrs ...

As someone else mentions, go to a notaire first (don't take what the immo says as gospel!)

Kira

[andyh4]

Sorry Kira but that is usually not correct

A barn conversion will attract 19,6% VAT since it was not previously a habitation and 5,5% is available for renovating habitations.

 

As usual however things are not quite that straightforward, since if the barn is attached to a habitation, and if the renovation includes connecting the habitation and the barn internally, then 5,5% will apply (usually - again it is possible to come up against exceptions, like huge barns with 1 up 1 down habitations and mega budgets)

 

At least that is what I understand and how it is being practised in the Ardèche.

[BJSLIV]

If its a newbuild barn conversion the work would have been charged at 19.6% as the lower rate only applies to existing houses and their outbuildings.

Is doesn't matter that much anyway, because the Vat paid will be offset against the liability on the sale proceeds.

Edit Oh I see Andy agrees with me!

 

 

[mini-mum]

Kira, where did you get the CGT figure from, because I don't think that 40% is correct!!!

[westland]

[quote user="andyh4"]

 if the renovation includes connecting the habitation and the barn internally, then 5,5% will apply (usually - again it is possible to come up against exceptions, like huge barns with 1 up 1 down habitations and mega budgets)

 

At least that is what I understand and how it is being practised in the Ardèche.

[/quote]

Do you know if this applys to new extensions that are connected internally to the existing habitation, thanks.

[Sunday Driver]

The rate of CGT for both French and non-French residents (who are resident in another EU country) is 16% of the net gain. If you are French resident you pay an extra 10% in French social charges making the effective rate 26%.  So if it's a holiday home, then it's just the 16%.  You are exempt from French CGT if you are in receipt of an old age pension or are an invalid.

 

[Jon 1]

Can you claim CGT if only one of you is in receipt of a state pension, ie the wife?

[Monika]

That sounds too good to be true Sundaydriver (sorry to question it!), I have never heard that you are exempt paying CGT in France on a maison secondaire if you are in receipt of a state pension.

[Sunday Driver]

That was taken from one of the many tax fact sheets published on forums such as this.

It's also set out in the code des impots:-

Article 150-A:

Sous réserve des dispositions particulières qui sont propres aux bénéfices professionnels et aux profits de construction, les plus-values effectivement réalisées par des personnes physiques ou des sociétés de personnes lors de la cession à titre onéreux de biens ou de droits de toute nature sont passibles.

Article 150-D:

Les dispositions de l'article 150-A ne s'appliquent pas :

6° Aux plus-values réalisées par les titulaires de pensions vieillesse non assujettis à l'impôt sur le revenu.

Article 150-C:

I. Toute plus-value réalisée lors de la cession d'une résidence principale est exonérée.

Now, whether or not this "retirement" exemption only applies to French taxpayers is another matter.....

 

 

 

[Logan]

[quote user="BJSLIV"]

A newbuild is complete from the date that the form is submitted. It means that you will be liable for VAT (18.6%)  on the difference between the receipted cost of the project and whatever you get for selling it.

[/quote]

New builds and some renovation projects that the notary classed as 'new build' at the time of purchase attract 19.6% TVA if sold WITHIN 5 years of purchase or 5 years from the date of the declaration of completion of works. If the original poster waits 5 years to sell TVA will not be payable. However CGT will if they are non-residents in France and sell within 12 years of purchase.