Investing in a non-professional lessor-lessor mode is very profitable for the lessor.
Investing in a non-professional lessor-lessor mode is very profitable for the lessor. By offering tax benefits based on property type and tax system, the LMNP allows you to pay lower taxes when renting property. In the case of resale, it allows the seller to take advantage of significant reductions on capital gains. In the LMNP, there are two systems that each offer tax advantages: the micro BIC system and the real system. Before making a rental investment on your own or with Homunity, for example, let’s see in detail the various existing plans, their advantages, and everything you need to know to choose the right plan.
BICI mini diet
The micro-business BIC is a tax system that requires an amount of annual revenue that does not exceed the maximum limit of the micro-enterprise. Craft, industrial and commercial activities are eligible for this system. To benefit from this system, the company must be a sole proprietorship and have EIRL or EURL status, and the director must be a single natural person. Owners of one or more properties can benefit from the Micro BIC system if their rental income does not exceed 72,600 euros per year.
All advertisements to the BIC micro-system require registration with SIRENE to obtain a SIRET number. With an easy-to-make permit, the fixed-rate system aims to simplify the lives of LMNP lessors. Simplicity of formalities is the main advantage of a small bank information center. All you have to do is declare the revenue collected and the tax authorities take care of the account. In his LMNP business, the owner is taxed only on half of his income. He will only pay taxes on half of the rents he collects.
Actual diet
The actual system defines the concept of taxation based on the profits of furnished rentals and the value added tax. There are two types of subsystems: the normal real system and the simplified system.
The actual scheme can be applied provided that the income generated by the activity of the LMNP exceeds 72,600 euros per year. Once he starts his unprofessional furnished rental business, the lessor can choose the real system, that is, until his first announcement. To take advantage of the real system, the owner must be declared as a non-professional furnished rental company. He must complete a POI form and submit it to the Commercial Court Registry against the SIRET number.
With the LMNP real case system, the owner can deduct the costs of acquiring a home provided the property has been acquired for at least two years. It is interesting only if the expenses related to the maintenance of the furnished accommodation are very high. This fee can be deducted from taxable income. In addition, this system provides for the possibility of deduction from the same taxable income the consumption of available housing and equipment. In this way, the tax will be further reduced.
This deduction specifically relates to notary fees, estate agency fees, co-ownership fees, loan interest, insurance and maintenance expenses. Thanks to this discount, the lessor pays lower taxes on his earnings. He must appoint a chartered accountant familiar with the LMNP to record depreciation in order to reduce taxes.