Immediate full VAT refund on the total amount of the purchase, ie 19.6% of the purchase price. In return, the owner must charge and pay 5.5% VAT on rent.

Outgoings related to the letting of furnished property (ie financing fees, registration duties, commissions, interest on loans, management fees [accountant, legal, etc.], property tax, maintenance and repairs, joint ownership charges) are deductible from your rental income and generate a fiscal deficit which makes them tax-exempt.

Any deficit relating to the running of the let is not immediately set against your overall rental income but can be deferred for up to 5 years and set against income considered as "Non-professional Industrial and Commercial Profits" (BIC)).

Depreciation of the building (not including land) is calculated in accordance with standard deferred depreciation rules over a period of 20 to 30 years; for furniture and fittings, over a period of 5 to 10 years. Depreciation is detailed in annual accounts. From a fiscal point of view, depreciation is only chargeable up to the value of rental income less other charges, the excess being carried forward indefinitely and generating tax-exempt rental revenue over the long term. Depreciation cannot be added to running deficit.

Capital gains and losses are treated in the same way as private capital gains:
Short-term gains are those generated within 2 years of the purchase. Up to 915 € per year can be deducted from your taxes.

Long-term gains are those generated more than 2 years after the purchase.

Leasing of the furnished property must be carried out by a specialized company (with a signed, 9-year commercial lease which is renewable for 3, 6 or 9 years).

For tax purposes, income from these lettings comes under the heading of Industrial and Commercial Profits (BIC).