THE KNOWLEDGE
If only 21 miles separate France and the UK, in terms of law they are a world apart. There are different and new concepts that need to be understood before embarking on your French property adventure. For example, testamentary
freedom exists in the UK while France has the forced heirship system. Some people think they will be able to dispose of their French property the way they wish upon their death... well, not exactly! To sum up, it is possible to
purchase the second home of your dreams and also make a good rental investment in France without being overcharged, but you
still need to be assisted by professionals who can give you the best advice based on your profile and your wishes. It should be noted
that in France, notaires are not independent advisors, they are public officers appointed by the
minister of justice to act on behalf of the French state during property transactions. It should also be noted
that estate agents are not legal advisors
either. In France, legal advice is reserved for avocats, who have the monopoly. It is therefore advisable
50% (up to 71% for classified tourist properties) on their property income. For investors who want to be
spared the hassle of managing seasonal lets themselves, a leaseback scheme or résidence de tourisme may be of interest. The property is managed by a third party; owners sign a commercial lease with the operator, which sets out the terms and conditions of the rental. The commercial lease commits the operator to finding tenants, maintaining the property and guaranteeing the payment of rent to the investor. The owner, for his part,
benefits from a right of occupation in a tourist residence for a few weeks a
year, according to a pre-defined schedule. The purchase price is generally well below the market rate, making it an attractive investment. The investors benefit from a secure investment, which is hassle- free and tax efficient. Be careful, however, to
target a reputable management company. Investors should also be aware that the minimum term of a French lease for a résidence de tourisme is nine years and if the owner wishes to take back the property, he must pay an eviction indemnity to the management company to compensate the losses and costs incurred (In general eviction indemnity = two and three years’ rental).
Good to know: As a double
taxation agreement exists between France and the UK, you don’t pay tax twice on the same income.
ADVICE AND ASSISTANCE A property purchase is an important and far-reaching commitment, especially when you buy in a country that does not have the same rules in terms of sales, taxation, litigation and inheritance law.
to seek independent advice from a French law expert who will navigate you through difficulties and answer your questions, and also help with managing your taxes and planning your property resale or estate in advance so you can purchase your French property with peace of mind. ■
Deborah Vaysse is an avocat at Furley Page, a legal team made up of French avocats and UK solicitors and tax experts
dav@furleypage.co.uk furleypage.co.uk
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FRENCH PROPERTY NEWS: September/October 202387
© SHUTTERSTOCK
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