Investing in property
in France from Canada

Canadian banks do not, in practice, finance a property located in France: it is a French bank that lends, with the HCSF standard (35% debt ratio, insurance included, 25 years at most). It looks at your Canadian dollar income with caution because of exchange-rate risk, and not all of them accept Canadian residents. The choice of banks and the presentation of the application make the difference: one of our members approached about fifteen banks.

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

The Canadian credit covers French income tax; its application to French social contributions is not confirmed by the Canadian tax authority. The €150,000 exemption on capital gain remains open to French nationals living in Canada, subject to conditions; that for the former main home sold after departure does not apply, as Canada does not assist France with tax recovery.

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

In Canada, a French SCI may be treated differently from in France and lead to additional filings: 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.

Your French rents are declared in Canadian dollars, at the Bank of Canada rate on the day of each transaction, on the rental income form (T776, and TP-128 in Quebec), net of actual expenses. French tax gives entitlement to the federal, then provincial, foreign tax credit (forms T2209 and T2036, TP-772-V in Quebec). If the total cost of your properties held abroad exceeds CA$100,000, a property let in France included, you also file form T1135 every year: the late-filing penalty is CA$25 a day, up to CA$2,500.

You can refinance your home in Canada, up to 80% of its value (65% for a line of credit without capital repayment), to pay the down payment and costs of a purchase in France. In Canada, the interest on this loan is deductible from rents because the money is used to earn rental income: it is the use of the funds that counts, not the property pledged as security.

On becoming a Canadian resident, you are deemed to have acquired your assets at their value on the day you arrive. If you already owned a property in France, Canada will tax, on resale, only the increase in value since that date.

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