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French property to let
Letting: a carefully regulated market
French property to let, especially for short-term holidays, covers an enormous range and much of the country. Some regions are naturally more popular than others - and some especially so for British holidaymakers trying to find some guaranteed sunshine!
For anyone hoping to let property in France it is worth remembering that the French letting market is much more regulated than the British one. If French law categorises you as a tradesman landlord, for instance, you could well incur tax penalties if you sell your property. Expert advice is required to make sure your letting is what you think it is. In any case, if the local authorities reckon yours is not a business, then both profits and losses must be reported as income using the standard return form. However, to add to the complexity, the tax applied to rental income in this case is not the same as that for normal income. You should also bear in mind that you will have to send your return to one address rather than another, depending on whether you are resident or non-resident.
If your letting activities in France are in fact a business, you will, like all businesses in France, have to complete a number of documents every year. Whatever the case, you should make sure that you check with the local authority whether or not your property to let should be registered as such; if it should be, you will have to comply with certain regulations
You should also remember that French rental income must always be declared in France, even if you have informed the Inland Revenue in the UK because the latter is your country of tax residency. The double tax treaty between Britain and France means that the French have the principal right to tax your lettings income.
The French Civil Code governs property let without a formal contract; this gives the landlord some - not much! - protection should he have a dispute with a tenant. However, in any short-term let anybody who decides to stay on can be difficult to evict, especially in the event of their not having a home of their own to return to elsewhere - unlikely, you might think, but not beyond the bounds of possibility. Further obstacles to eviction arise if the letting period is greater than three months, or if the property is unfurnished.
VAT incorporates another set of rules and, together with income taxation, demands special care; professional advice is recommended.
Informing the market
Attracting tenants other than family and friends can be achieved in a number of different ways these days. There are numerous routes, with websites arguably leading the way. You can use specialist agents, many of them operating internationally and usually prominently advertised in key magazines in the UK, as well as through their own websites. You can also do your own advertising directly in specialist or other publications, both locally in France and in the UK. Some French local newspapers have a lettings page or two; tourist offices are another possibility. If your property is in a part of France where there are in effect two seasons, eg skiing in winter and outdoor activities in summer, your advertising efforts will naturally require two separate campaigns. And it is important to remember that any advertising for your French letting placed in the UK is subject to the British Trade Descriptions Act and the Consumer Protection Act, both of which can lead to criminal proceedings against you if you knowingly mislead the potential customer.
Looking after tenant and landlord
The main hassle factor in letting is, of course, clearing up between tenancies, and in the case of short-term lets this comes up with alarming rapidity. It goes without saying that without maintaining high standards of cleanliness and repair you are bound to lose your customers. Effort, application and care are required, all of which could be difficult to achieve if you yourself are not on the spot to oversee them. If this is the case, the most reliable alternative is to use some kind of letting agent. Such an agent requires a license, and if you engage one, you are obliged to obtain a written agreement from him setting out rights and duties on both sides.
Tenancy agreements are probably advisable if you handle the tenancies yourself but are an essential part of the letting agent’s paraphernalia but you need to check whether they contain any clauses that might penalise you as landlord. Once again, although you might well be able to work out whether the agreement is potentially damaging to you or not, it is probably wisest to get a lawyer to look at it.
Finally, however it might be arranged, you should make absolutely sure your tenant has grasped the meaning of his agreement
Find a Property in France is not responsible for the accuracy or otherwise of the information in this article. Anybody intending to buy a property in France should seek the appropriate professional advice.
A Beginner’s Dictionary
Letting agent: agent locataire
Landlord: bailleur
Tenant: locataire
Lease: bail
Local tax office/chamber of trade: chambre des metiers
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