To have the status of professional furnished rentals (LMP), the 2 following conditions must be brought together:

• The annual revenue from this activity (total rents including all taxes and charges) for all members of the tax household must exceed €23,000 on calendar year. This must also be the case when the accounting year is closed in the course of the year. If an activity is created during the year, the ceiling is adjusted.
• This revenue must be higher than the total amount of other income from the activity of the tax household (wages, other BIC).

If one of these conditions is not met, the renter is considered to be a non-professional furnished rentals (LMNP).

The professional or non-professional nature of the furnished rental applies to all furnished rentals of the tax shelter.

The rental may be only seasonal, provided that the activity is carried out in a professional and usual manner.

The professional furnished rental agency is not obliged to be registered in the Commercial and business Register (RCS) and the National company Register (RNE).

VAT

Furnished rentals, without provision of services, are not subject to VAT: titleContent.

Taxation system

The renter of professional furniture is subject to income tax (IR) in the category of Industrial and Commercial Benefits (BIC) individual business where he carries out his activity in If he carries out his activity through an SCI, he shall be subject to business tax (IS).

The renter in furnished professional entrepreneur individually, is subject to the micro-company regime or to an effective taxation regime according to his turnover (CA).

New turnover thresholds (turnover thresholds) are being introduced for the rental of tourist furniture. We present the thresholds applicable to revenues for the year 2024 and those applicable to revenues for the year 2025.

Since this is a professional activity subject to the real tax regime (except for micro-company), the following charges may be deducted from income tax (i.e. rent collected):

• Establishment costs (notary fees, business costs in particular)
• Maintenance and repair costs
• Local taxes
• Management and insurance costs
• Interest on loans
• Depreciation furniture and improvements (lasting 5 to 10 years, for a rate between 10% and 20% per year)

Furthermore, the trader may depreciate the premises. The purchase price of real estate is not a deductible expense, but can be amortized depending on the actual holding period. If it is estimated at 50 years, 2% the price of the property may be deducted during that period each year.

Exemption from disposal capital gains

The type of exemption changes depending on the amount of revenue:

• Exemption is total where rental income is less than €90,000 excluding taxes (HT) during the 2 calendar years preceding the transfer. Furnished rentals must also have been in operation for at least 5 years.
• Exemption is partial where such revenue is between €90,000 and €126,000 HT.

The activity sometimes includes services similar to those of hotels: breakfast, regular cleaning of the premises, supply of household linen, reception of customers. Thus, when at least 3 of these services are offered, the tax regime applicable is that of the para-hotelier, and not that of the furnished rental. E In this case, the thresholds are the following:

• Exemption is total where rental income is less than €250,000 excluding taxes (HT) during the 2 calendar years preceding the assignment. Furnished rentals must also have been in operation for at least 5 years.
• Exemption is partial where such revenue is between €250,000 and €350,000 HT.

Furnished rented premises are subject to the following local taxes:

• Property tax,
• Company Property Tax (CFE), with exceptions. To learn more about exceptions, you can visit the page dedicated to furnished rentals from impots.gouv.fr.
• Company Value Added Tax (VAE) in the case of turnover excluding tax exceeding €500,000