FAQ
What happens if my tenant moves out?
You must do everything you can to re-let your property as quickly as possible. However, the tax authorities will tolerate a period of vacancy as long as you can provide evidence to show that you are doing everything possible to re-let your property.
What happens if I sell my property before the 9-year rental commitment has expired?
Failure to fulfil your rental commitment effectively cancels the tax benefits you have received (except in those special circumstances where the rules offer exemption from these penalties). You must therefore declare the tax reductions received in previous years as part of your property-generated income for the year in which you sell.
Does the Scellier scheme cover investments made via an SCI (property investment company)?
It’s perfectly permissible for you to make a Scellier scheme investment via a Société Civile Immobilière, as long as the SCI concerned is not liable for French corporation tax.
Every share-owning SCI investor will receive the tax reduction on his/her share of the investment made.
Every share-owning SCI investor will receive the tax reduction on his/her share of the investment made.
Can I rent my property to my children under the Scellier scheme?
You are allowed to rent your property to your children under the standard Scellier scheme, as long as the children concerned do not form part of your household for tax purposes. They must therefore be making their own personal tax returns independently.
What options do I have at the end of the 9-year period?
The options open to you at the end of your 9-year rental commitment depend on the scheme you chose originally.
If you have used the standard Sellier scheme, you can:
- continue to rent your property with no further conditions attached
- or let it at a below-market rent under an agreement signed with the French National Housing Agency (Agence Nationale de l’Habitat or ANAH) to receive a specific deduction. This deduction is either 45% (for homes in the “intermediate sector” - secteur intermédiaire), 60% (for homes in the social housing sector) or 70% (for homes in the “intermediate social sector” secteur social intermédié) of the rent received. But regardless of the rate you receive, the deductions granted under this “conventionnement ANAH” scheme cannot be combined with those granted under the Rural Regeneration Zone (Zone de Revitalisation Rurale or ZRR) scheme.
If you have used the Scellier Social scheme, you can extend your commitment for 3 years (renewable once only) to gain an additional annual tax reduction equivalent to 2% of the original cost of the property.
In either case, you may - of course - decide to sell the property.
Can I make more than one tax reduction investment under the Scellier scheme?
You can make only one investment per year under the Sellier scheme.
Neither is it possible to combine the benefits granted under the Sellier scheme with those offered by other tax incentive schemes, such as the Rural Regeneration Zone, Malraux or other schemes. On the other hand, you can make other investments in other properties, including those covered by the Borloo and Robien schemes.
Neither is it possible to combine the benefits granted under the Sellier scheme with those offered by other tax incentive schemes, such as the Rural Regeneration Zone, Malraux or other schemes. On the other hand, you can make other investments in other properties, including those covered by the Borloo and Robien schemes.
What is the maximum amount of tax benefit I can claim?
The total investment is capped at €300,000. The tax reduction you receive (on investments made in 2009 and/or 2010) under the Scellier Social scheme can amount to 37% of the amount you invest, if you extend your rental commitment from 9 to 15 years.
So the maximum tax reduction available is €111,000 over 15 years!
So the maximum tax reduction available is €111,000 over 15 years!
How is the tax reduction spread over the years?
The tax reduction rate is 25%. That percentage applies to the purchase price or total cost price of the property for purchases made in 2009 and 2010. It is spread evenly over 9 years.
So, for example, if you invest €200,000 in 2009, the tax reduction will be €50,000 (€200,000 x 25%) over 9 years = €5,555.55 per year.
So, for example, if you invest €200,000 in 2009, the tax reduction will be €50,000 (€200,000 x 25%) over 9 years = €5,555.55 per year.
What happens if the amount of the tax reduction is higher than my tax assessment?
No repayment will be made where the tax reduction is greater than the amount of tax due. However, you can carry forward the difference for up to 6 years.
For example, if the tax reduction is €4,000 and you owe €2,500 in tax, you will have no tax to pay and may deduct the balance of €1500 from your tax bill for the following tax year. If the tax reduction exceeds the amount of tax you owe in the following year, then the difference can be carried forward again up to and including the 6th year.
For example, if the tax reduction is €4,000 and you owe €2,500 in tax, you will have no tax to pay and may deduct the balance of €1500 from your tax bill for the following tax year. If the tax reduction exceeds the amount of tax you owe in the following year, then the difference can be carried forward again up to and including the 6th year.
How do I claim the tax reduction? What do I actually have to do?
Tax reductions are not granted automatically: you must notify the tax authorities of your rental commitment and declare the investment(s) you have made.
In practical terms, you inform the tax authorities of the tax incentive scheme you want to use by submitting form 2044 EB together with your tax return for the year in which the property was purchased, even if it has not been let at the time you submit your return (although you must let it within 12 months).
You must also enclose supporting documentation, such as a copy of the lease and - if you are opting for the Scellier Social scheme - a copy of your tenant’s tax assessment (whether he or she is liable to pay tax or not).
In practical terms, you inform the tax authorities of the tax incentive scheme you want to use by submitting form 2044 EB together with your tax return for the year in which the property was purchased, even if it has not been let at the time you submit your return (although you must let it within 12 months).
You must also enclose supporting documentation, such as a copy of the lease and - if you are opting for the Scellier Social scheme - a copy of your tenant’s tax assessment (whether he or she is liable to pay tax or not).
Le dispositif Scellier s’arrêtant au 31 décembre 2012, pourrai-je toujours bénéficier de mes réductions d’impôt après cette date ?
Legal notices (only in french)
(1) Réduction d'impôt, codifiée à l'article 199 septvicies du code général des impôts modifié par la loi de finances pour 2012, pour tout investissement locatif réalisé jusqu'au 31 décembre 2012, égale à 13 % du prix d'acquisition du bien retenu dans la limite de plafonds par mètre carré de surface habitable fixés par le décret n°2012-305 paru le 5 mars 2012, en fonction de la localisation du logement, et dans la limite maximale de 300.000 €. La surface habitable à prendre en compte est celle définie au troisième alinéa du a de l'article 2 duodecies du CGI. Elle s'entend de la surface habitable au sens de l'article R. 111-2 du code de la construction et de l'habitation, augmentée de la moitié, dans la limite de 8 mètres carrés par logement, de la surface des annexes mentionnées aux articles R. 353-16 et R. 331-10 du même code. Cette réduction d'impôt est prise en compte pour le calcul du plafonnement global de certains avantages fiscaux visés à l'article 200-0 A du CGI.
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