The long-awaited changes to the French Capital Gains Tax (CGT) system went live on September 1, with agents already noting their popularity with property buyers and investors.
According to agency Leggett Immobilier there has already been overseas buying interest in the double benefit.
First the exoneration period has gone down from 30 years to 22 years (for properties where the acte de vente was signed after September 1st).
Second, there is a special reduction to "aid the fluidity of the property market" – a tax allowance of 25 percent has been introduced for one year only which will apply to sales between September 1 2013 and August 31 2014.
This allowance will be taken off once all other reductions have been taken into account. CGT is known in France as "impôt sur les plus values" and is made up of two parts – 19 percent for the tax element and 15.5 percent for the social charges and the change to the exoneration period applies only to the former part.
As with many things related to the French taxation system there are a few exemptions and the calculations are not at all straightforward so it is most important to seek specialist advice.
Trevor Leggett, Chief Executive of Leggett Immobilier, said:"It’s great news that these changes are now in place and just the kind of kick start that the market wanted going into the Autumn.
“Many of our clients have mentioned these changes while looking at properties and we have certainly seen an upturn in both general enquiries and offers made.
“This will be a record year in terms of sales for our agency and these beneficial changes to the CGT calculations are a positive step forward for the market as a whole".
Andrew Batt, International Group Editor of
PropertyGuru Group, wrote this story. To contact him about this or other
stories email andrew@propertyguru.com.sg
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