Investing in property
in France from Australia

It is a French bank that finances your purchase, with the HCSF standard: a 35% debt ratio, insurance included, and a maximum term of 25 years. It looks at your Australian dollar income with caution because of exchange-rate risk, and not all of them accept Australian residents. A loan in Australian dollars from a French bank is only possible if you mainly earn your income, or hold assets, in that currency; most applications are financed in euros. With Sydney or Melbourne 8 to 10 hours ahead of Paris, exchanges with the bank, the notary and the tradespeople are scheduled early in the morning or in the evening: the choice of banks and a complete application from the start make the difference.

Also read: which banks lend to expats and how much down payment to plan for.

The France-Australia tax treaty also covers the CSG and the CRDS: they therefore count towards the Australian tax credit, up to its limit, because Australian law treats taxes covered by a tax treaty as foreign income tax. The 7.5% solidarity levy is not named in it, and its treatment is not confirmed. The €150,000 exemption on capital gain remains open to French nationals living in Australia, subject to conditions. And the former main home may be exempt if it is sold no later than 31 December of the year following departure, without having been let or lent in the meantime: the law grants this for a departure to a State that assists France with the exchange of information and the recovery of tax, which the treaty provides for (Articles 25 and 26). No official list names Australia: have your notary confirm it. On the Australian side, this sale may remain taxable if you are not a temporary resident.

Also read: how the rents of a non-resident are taxed.

In Australia, a French SCI may be treated differently from in France and complicate your Australian return: to be reviewed with a tax specialist before buying through a company.

The right choice depends on your project and your country: compare with the rental income tax calculator.

The Australian tax year runs from 1 July to 30 June, and the return (tax return) must be filed by 31 October at the latest if you do it yourself, later with a registered tax agent. Your French rents are declared there in Australian dollars, at the rate on the day of each transaction or at an average rate over 12 months at most, net of actual expenses. French tax gives entitlement to the Foreign Income Tax Offset: up to AU$1,000, you simply state the tax paid; beyond that, a cap is calculated. This credit is neither refunded nor carried forward to the following year. If your assets outside Australia are worth AU$50,000 or more, you also report them in the return.

You are a temporary resident if you hold a temporary visa, you are not a resident for Australian social security purposes and your spouse is not either. Your foreign income, French rents included, and the capital gain on a property located outside Australia are then not taxed in Australia: you pay French tax only. In return, you are not entitled to the 50% discount on capital gains taxable in Australia. On the day you stop being a temporary resident while remaining in Australia (permanent visa, for example), your French property is deemed acquired at its value on that day: only the increase that follows will be taxable in Australia. Have it valued at that date and keep the proof.

The steps of the ImmoPourExpat method, from the first call to letting →