Tax on a non-resident’s rental income: rates, calculation and optimisation in 2026

20% minimum tax, plus 17.2% social contributions: on paper, your French rents are taxed at more than 37% from the first euro. This is the figure found everywhere, and it is the one that pushes many expats to give up, or to invest without having done the calculation.

Everyone knows the rule. Nobody shows the calculation. This guide does the opposite: each rule is followed by a worked calculation, on the same property, regime by regime. You will see that the bill goes from more than €3,000 to zero, depending on choices made before the purchase. With ImmoPourExpat, we have supported more than 1,000 non-resident French people in more than 60 countries in finding their property, financing it, but also optimising their taxation: it is the third pillar of a successful project when you want to investing in France from abroad.

Non-resident and rental income: who is taxed in France, and on what?

French tax resident vs non-resident: the definition that triggers everything

You are a French tax resident if you meet just one of these three criteria: your home or main place of stay is in France, you carry out your main professional activity there, or you have the centre of your economic interests there. A resident is taxed on worldwide income. A non-resident, for their part, is taxed in France only on French-source income.

French-source income: what falls within scope (unfurnished, furnished, SCI)

A property located in France produces French-source income, no matter where you live. For unfurnished rental, this is property income. For furnished rental, industrial and commercial profits (BIC). Through an SCI subject to income tax, your share is taxed in your hands as if you held the property directly. Through an SCI subject to corporate tax, it is the company that pays: 15% up to €42,500 of profit, 25% beyond.

What is NOT taxed in France (and why)

Your salary abroad, your rents received in another country, your local savings: none of this is taxed in France. This income only serves to calculate your average rate, if you ask for it (we’ll get to that). On the other hand, taxes attached to the property remain due in all cases.

“You must distinguish levies from taxes. Levies, whatever your regime and your country, you pay them: property tax, tourist tax for seasonal lets, CFE for furnished lets. Taxes, for their part, depend on the regime you choose, and that is where everything is decided.” Frédéric Moreau, founder of ImmoPourExpat

The 20% minimum tax rate: the rule to know before buying

How the minimum rate works (and when it really applies)

Your tax is calculated like a resident’s, with the progressive scale and the family quotient, but only on your French income. Then the administration applies a floor: the tax cannot be lower than 20% of your net taxable income up to €29,579 (2025 income), and 30% on the portion beyond. For a property in the overseas departments (DOM), these rates are reduced to 14.4% and 20%.

“When you are an expat, don’t forget that France applies a flat rate of 20 to 30% on your rental income. It is not that high. And what’s more, you can go much further and bring those 20% down.” Frédéric Moreau

20% minimum rate vs progressive scale: the calculation that decides

You can set aside this floor by requesting the average rate : the administration calculates the tax you would pay if all your worldwide income were taxed in France, derives a rate from it, and applies it to your French income alone. You just tick “Benefit from the average rate” in the Non-residents section of the online return and state your foreign income. This rate is applied only if it is more favourable to you: ticking it costs nothing.

Modest incomes: when the minimum rate loses you money

Educational example: you are single, your worldwide income is €28,000, of which €8,400 of net property income in France.

• At the minimum rate: €8,400 × 20% = €1,680 of tax.
• At the average rate: the French scale applied to €28,000 gives an average rate of about 6%. Applied to your €8,400: a little over €500.

Gap: more than €1,100 a year, for a box to tick. Conversely, with €90,000 of worldwide income, your average rate exceeds 20% and the minimum rate applies.

Social contributions: the line forgotten in simulations

Non-residents’ liability to social contributions

Your rents also bear social contributions : 17,2 % on unfurnished rental (CSG 9.2%, CRDS 0.5%, solidarity levy 7.5%), and 18,6 % on non-professional furnished rental since the CSG increase applicable in 2026. If you are affiliated to a compulsory social security scheme in the EU, the EEA, Switzerland or the United Kingdom, you are exempt from CSG and CRDS: only the solidarity levy of 7,5 %, provided you tick boxes 8SH or 8SI of your return.

“The European Economic Area is a club. And when you are part of a club, you enjoy certain benefits. Expats in Dubai tell me it is not normal to pay more: that is true, but there are legal ways to reduce, or even cancel, this taxation.” Frédéric Moreau

Minimum rate + social contributions combined: the true effective rate

These rates are frightening, but they apply to your taxable base. And this base depends entirely on the regime you choose.

Unfurnished rental: micro-foncier or actual regime?

Non-resident micro-foncier: 30% allowance, €15,000 ceiling

If your gross rents do not exceed €15,000 a year, you fall by default under the micro-foncier : a flat 30% allowance, no costs to justify. Simple, but rarely optimal when you have a mortgage.

Actual regime: property deficit, renovation works, loan interest

Under the actual regime, you deduct your costs for their exact amount: interest on your mortgage for non-residents, property tax, insurance, management fees, maintenance and improvement works. The option commits you for three years. If your costs exceed your rents, you create a property deficit, carried forward against your property income for the following ten years. The general rule also allows the part of the deficit not coming from loan interest to be set against overall income, up to €10,700 a year: for a non-resident, this point should be validated with your chartered accountant.

Worked simulation: same property, two regimes, two results

Educational example: an apartment let unfurnished at €1,000 a month, i.e. €12,000 a year, by a non-resident living outside Europe. Actual costs: €3,500 of interest, €900 of property tax, €200 of insurance, €800 of management fees, €600 of maintenance, i.e. €6,000.

The actual regime saves €893 a year on this property. The rule to remember: as soon as your costs exceed 30% of your rents, the micro-foncier costs you money.

This is exactly the trade-off we make at ImmoPourExpat with our members, before the purchase: simulating the property regime by regime, to choose the one that leaves the most cash flow, not the one offered by default.

Furnished rental (LMNP): the often more advantageous alternative

Non-resident LMNP: depreciation and deficit carry-forward

With furnished rental, you fall under BIC. Under micro-BIC, the allowance is 50% up to €77,700 of revenue for standard furnished rental (30% up to €15,000 for an unclassified tourist furnished let). Under the actual regime, you deduct your costs and above all thedepreciation of the property and furniture: an accounting charge, which you do not pay out in cash. Depreciation cannot create a deficit, but the unused portion is carried forward with no time limit. The full rules are in my guide on the LMNP regime for non-residents. Two trade-offs: bookkeeping to maintain, and depreciation added back into the capital gain calculation on the day you sell.

Unfurnished vs furnished comparison on a worked case

Let’s take the same property, this time let furnished at the same rent. Under actual-regime LMNP, costs rise to €6,900 (with CFE and chartered accountant), and depreciation estimated at €5,300 absorbs the remaining result.

For someone affiliated to a European, Swiss or British scheme (social contributions at 7.5%), the totals become €2,310, €1,650, €1,650 and €0.

Same property, same rent: from €3,125 to zero. And this cash flow after tax is also what your banker looks at to finance your investment as a non-resident.

“I have a studio that I bought and renovated: it earns me between €50 and €80 a month because I chose a suitable tax regime. With another regime, it would be the opposite: I would lose between €20 and €50 every month.” Frédéric Moreau

Want the same calculation on your project? These figures are educational examples. For your precise situation (country of residence, mortgage, type of property), request a personalised simulation. Request my free analysis

Cash flow is what remains once the mortgage, costs and taxes are paid. Here is the experience of a member who generates €500 a month.

Tax treaty: how to avoid double taxation

Tax credit vs exemption: the two mechanisms

Your rents are taxed in France, but your country of residence may also want to tax them. The tax treaty then obliges it to neutralise the duplication. Either it exempts your French rents (counting them only to set your rate on your other income), or it taxes them and grants you a tax credit equal to the tax paid in France, within the limit of its own tax.

Tax credit calculation method in your country of residence

Three steps: the tax paid in France, the local tax calculated on those same rents under your country’s rules, then the smaller of the two, which is your credit. Beware the trap: an LMNP at zero tax in France gives zero credit, and a country that does not recognise depreciation will then tax your rents locally. The country-by-country detail is in my guide to avoiding double taxation thanks to the tax treaty, and it is a central point of our non-resident tax expertise.

“Double taxation is never because of France: in real estate, French tax rules are rather advantageous. It is in certain countries of residence that it can become very disadvantageous, especially if you have chosen the wrong structure.” Frédéric Moreau

Tax return: practical obligations of the non-resident

Forms 2042, 2044, 2044-EB: which for which income

Everything goes through income tax return no. 2042, online, with the non-resident individuals’ tax office. Under micro-foncier, you simply report your gross rents there. Under the actual regime, you additionally fill in return no. 2044 and carry the result to the 2042 (the 2044-EB only concerns the letting commitment of certain tax-relief schemes). For furnished lets, it is the 2042-C-PRO under micro-BIC, and a full tax package under the actual regime. For this part, our members can rely on Amarris, our partner accounting firm.

Tax representative and withholding tax: what changes

Your rents are subject to withholding tax in the form of instalments, taken directly from your bank account, then settled on the tax notice you receive from the end of July. As for the accredited tax representative, it concerns the sale of the property, not the declaration of rents. However, if you live outside the EU or the EEA, the tax office may ask you to appoint a representative in France responsible for receiving its mail: you then have 90 days to do so.

Filing calendar and late penalties

The return is filed every spring. In 2026, the online deadline for non-residents was set at 21 May. In case of delay, the surcharge is 10%, then 20% and 40% after formal notice, with late interest of 0.20% per month.

3 costly mistakes (and how to avoid them)

1. Staying on micro-foncier by default. This is the regime applied automatically under €15,000 of rents. In our example, it costs €893 more per year than the actual regime, and €3,125 more than actual-regime LMNP.

2. Forgetting social contributions and the boxes to tick. A yield calculated with “20% tax” is wrong by 7.5 to 18.6 points. And two boxes change your bill: the average rate if your worldwide income is modest, boxes 8SH or 8SI if you are affiliated to a European, Swiss or British scheme.

3. Choosing your regime without looking at what comes next. A regime is also judged on capital gains tax on resale, on the treatment in your country of residence, and on what happens if you come back.

“Don’t choose only on the basis of current taxation. Think about your overall project and your future mobility: if you come back to France, it can completely upend your tax strategy.” Frédéric Moreau

These three mistakes have one thing in common: they are settled before signing. That is why, at ImmoPourExpat, tax optimisation is handled at the same time as the property search and financing, with non-resident tax specialists who can also support you through to the return.

FAQ: non-resident rental income tax

Does a non-resident pay CSG on their rents?

Yes, unless they are affiliated to a compulsory social security scheme in the EU, the EEA, Switzerland or the United Kingdom. In that case, they are exempt from CSG and CRDS and pay only the 7.5% solidarity levy. Otherwise, social contributions are 17.2% on unfurnished rental and 18.6% on furnished rental.

Can you set off a property deficit when you live abroad?

Yes, under the actual regime: the deficit is carried forward against your property income for the following ten years. The general rule also allows the part of the deficit not coming from loan interest to be set against overall income, within the limit of €10,700 a year. For a non-resident, who often has no other French income, it is mainly the carry-forward that matters, and the rest should be validated with your chartered accountant.

Does the 20% minimum rate apply to furnished lets?

Yes. The minimum rate applies to all your French-source income, property income as well as furnished rental profits. But it applies to the taxable result: under actual-regime LMNP, depreciation often brings this result to zero, and 20% of zero is zero.

Ready to find out what your property will really cost you in tax? You are a non-resident and you want a figure, not a rule? We have supported more than 1,000 French people in more than 60 countries, from the property search to tax optimisation. Book your free diagnostic. Book a meeting with an expert