TAXATION: THE TREATMENT OF RENTAL INCOME
The incomes of a rent-bare (unfurnished) are income property. You then benefit from the tax regime of the microfruiter up to 15,000 euros in annual revenue (tax on 70% of rents) and the real regime beyond (deduction of expenses for their actual amount).
As for the income from a furnished rental, they represent Industrial and Commercial Profit (BIC).
Unfurnished rental: tax reduction and land deficit
The rental investment in new real estate offers a generous tax reduction: up to 63,000 euros over a period of 12 years. Thus, with the Pinel scheme, it is possible to invest until 2021 in certain so-called "tense" rental zones. To benefit from the tax benefit you must commit to renting your property for a period of at least 6 years to a tenant with limited resources. If you do not rent your property you will lose the tax benefits associated with the device. Also, it is important to favor a location for rental.
When you have an old home for rent, you can benefit from the Cosse tax system. An agreement signed with Anah for a period of 6 or 9 years then commits you to rent housing to tenants with modest resources (or very modest). In return, you can deduct 15 to 85% of your rent from your income tax return.
In unfurnished rent, the leverage of the land deficit is particularly interesting. Indeed, when you renovate an old property, the work can be deducted from your overall income of the year up to 10 700 €. The amounts invested can thus reduce the other income of your tax household, and the surplus can be carried forward for the next 10 years on your property income. In addition, the interest and borrowing costs associated with your acquisition are also deductible from rents received without a time limit.
Furnished rentals: Internet platforms and exemption of IFI
The finance law for 2018 is favorable to furnished renters. Indeed, the ceilings of the micro-BIC were raised from 33 200 to 70 000 euros (from 82 800 to 170 000 euros for classified holiday rentals). The micro-BIC scheme offers a 50% or 71% rebate on gross revenues. The real scheme is also very advantageous in furnished, because it allows to amortize each year a portion of the price of the property, in addition to other deductible expenses.
Furnished renters with professional status (23,000 euros rents per year representing more than 50% of the household's professional income) are exempt from IFI on these properties. In addition, the deficits are imputable without limit on the other incomes of the home and the resale of the goods can profit from the advantageous tax system of the professional gains.
When you rent through an Internet platform (AirBnb, HomeAway ...), your rents are taxable from the first euro. The platforms must inform you about your tax obligations and provide you each year with a document specifying the income generated by their intermediary.
2019, anticipate the deduction at source
With the introduction of the withholding tax in 2019, your rental income in 2018 will probably escape the tax. Your 2018 return (2017 property income) will allow the tax authority to calculate the applicable tax rate. To avoid double taxation in 2019, a tax credit will erase the taxation of your 2018 rents.
However, to avoid a deadweight effect, the Treasury has set up safeguards and only your non-exceptional income will be eligible for the tax credit. It is therefore not a question of postponing the payment of expenses to 2019. In the same way, only the average work paid in 2018 and 2019 can be deducted from the taxable rent for 2019. Thus, if you do not work this year, those realized next year will only be deductible at 50%.
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