As with everything else of this nature, your best move at the offset is to consult a lawyer with expertise in this field to be absolutely sure that you are fully cognizant of all the laws involved in this project.
You can either sell your property directly yourself, there is no law against this in France, or you could go with an Estate Agent. Obviously if you undertake to sell it yourself you will need to arrange all the advertising, mandatory surveys and appoint a Notary to prepare all the paperwork. Alternatively, an Estate Agent would take care of all this for you, but would charge up to 10% of the price of the property.
There are Mandatory Surveys that you will have to have carried out on your property before you can put it up for sale. These depend largely on which area the property is in and also what year it was built;
Termites. If your property is in a recognized Termite troubled area you will have to have this survey.
Asbestos. On properties built before 1997.
Lead Paint. On properties built before 1949.
Safety of Electrical System.
Safety of Gas Installation.
Energy Efficiency of Property.
You must inform a registered French Notary when you sell your property and he will prepare all the legal paperwork necessary for the sale. He will also prepare your title deed and witness your signature at the time of sale.
There are also Taxes that you will be liable for on the sale of your property:
Capital Gains Tax. Any profits you make from the sale of your property can be subject to CGT. This is calculated by subtracting the purchase price from the sale price and then deducting agent commission, legal fees and the cost of any renovations to your property. You will need to produce proper receipts including VAT as proof of this. However, you could be exempted from CGT if your property price is below 15,000Euros, the property is your primary residence or if you have owned your property for more than 15 years. Also you may be liable for CGT in the U.K., if this should be the case the tax treaty between the two countries ensures that you will only have to pay one country, whichever is the highest. You will also be liable for all taxes related to your property up until completion of the sale. This includes, Tax Fonciere which is paid for a full tax year, but will be refunded to you by the buyer on a prorated basis and Tax d’habitation which is paid by the owner each year with no refunds. If you are not a resident tax payer, a special tax accountant will be appointed who will ensure that no money leaves your account until your tax bill has been paid to the French tax authorities. His charge is normally 1%.
The stamp duty and land registry fees are paid by the purchaser.
The final payment will be made to the Notary within a few days of signing. He will first deduct any taxes and outstanding mortgage repayments due to the bank and then the money will be transferred to your account.
by Carole Hughes, AboutFrenchProperty.com - Copyright © About French Property
Thanks for your post. I found it informative and helpful.
Comment by Ipsos
Hello, please can you tell me what are the TVA implications of selling a new build property in France if you have owned it for less than 5 years? I understand that there is a 19.6% TVA tax on the selling price, but can anything be deducted from this? When you buy a property off-plan, do you pay TVA that can then be deducted from this calculation? e.g. if you buy a new build property from a developer for €100k, you would have paid €19,600 TVA. If you then sell it within 5 years for €200k, TVA will be payable of €39,200. Can we deduct the original €19,600 paid to leave a tax bill of only €19,600?
Thanks, Tara
Comment by Tara Patel