Yes , see an accountant but LF is cheaper!

[Beryl]

I may be asking lots of property related question over the next few weeks. I am not researching a book [:)]but looking at the most efficient ways of doing things.

If I have a property that I want to rent out, would it be better from a taxpoint of view to keep a mortgage on a property or own it outright.

Eg if I have a mortgage, will this be deducted from any rent I receive ? Then will I only pay tax on the difference like in the UK or if I own it outright I assume i will pay  tax on the whole rent received minus expenses.

I may have over simplified this, but you may get the general idea.

 

[Iceni]

If you take out a loan to buy the property then one assumes that you will receive interest on the capital that you COULD have used. This is taxable etc and unearned income in France is taxed more heavily,

BTW with free advice you often get what you pay for.

John

not

[Beryl]

Thanks

Just like to have some idea of options before I pay a fortune for professional advice.[:)]

I was just thinking along UK lines where if you have a loan on a house you rent out , this money is taken out of the equation before you pay any tax, so I believe, but if you own the house outright, the whole income minus expenses would be subject to tax.

 

[Will]

Should you be in a position where wealth tax is payable, as you could well be if you own more than one property, then having a mortgage can help reduce your liability.

There are also various schemes which offer favourable tax positions and interest rates on rented property. These mostly apply to long-term rents of low-cost housing in certain areas, or to holiday lets, but you really would need to check with an accountant who could say which, if any, would suit your own circumstances.

It seems particularly true in France, where taxation and finance issues are so complicated, that an accountant can invariably more than cover his fees through what he saves for you, so do not hesitate to contact somebody professionally qualified (do go by recommendation if you can, because, as with all professions, there are a few useless individuals out there).