Guest authored by our member Géraud Ferrandier, CEO, La French Audit
Furnished rentals are experiencing significant growth, particularly thanks to various digital applications. France’s tourist attractions make it a popular destination for purchasing real estate intended for rental. But what about foreign residents who wish to engage in this activity? Are they subject to French social security contributions? The answer is not so simple…
Conditions for social affiliation
Furnished rentals are considered a professional activity and, as such, must result in social affiliation in two scenarios:
When rental income exceeds €23,000 per year, to a clientele staying by the day or week, for example;
When the status of professional furnished rental landlord is granted in the fiscal sense, that is, when income exceeds €23,000 and represents the main income of the tax household.
Specific regime for foreign residents
Mandatory affiliation as a self-employed worker applies, whether the worker resides in France or abroad. However, if the foreign resident is not taxed in France on this income, social contributions are calculated on a minimum basis.
Possible exceptions
Under France’s international commitments, French social regulations may not apply in certain cases:
If the resident engages in another professional activity in an EU member country, Iceland, Liechtenstein, Switzerland, or Norway, European legislation provides for the application of a single social protection legislation.
If the resident engages in another professional activity outside these countries, but in a country with which France has concluded a bilateral social security agreement.
Concrete example
Let’s take the example of a French national working in the USA as a self-employed person. If they buy a property in France and rent it out weekly, generating income exceeding €23,000, only American legislation will apply. The income will therefore be subject to American law. To justify their situation in France, they will need to obtain form SE 404-02 from the competent American authorities.
https://www.cleiss.fr/independants/independant_etatsunis_france.html
Insights brought to you by our member Géraud Ferrandier, CEO, La French Audit
About La French Audit:
French Audit is an independent accounting and advisory firm based in Nantes, in Western France. We specialize in assisting French nationals living abroad with the tax management of their properties and interests in France. Our mission is to simplify French tax obligations for expatriates and offer tailored, reliable support from across the Atlantic.
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