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Which work are deductible?

The cost of the work done on the property can be deducted :
 
  • Either for their real cost, by producing all the invoices with legal mentions (art. 289 French Tax Code) and proof of payment (bank statements of the seller).
    Only expenses relating to construction, reconstruction, improvement or extension work are deductible.

Warning :
  • Repair and maintenance work can never be deducted from the capital gain,
  • Expenses which have already been deducted from income tax purposes are excluded,
  • Expenses relating to improvement work can never be deduced if the seller is a legal entity.

Warning :
  • Owner's personal labour cost is excluded,
  • Material bought by the taxpayer and paid labour costs are excluded. They can eventually be taken into account, but only if you bought land and if you are selling a building.

  • Or for a 15% lump sum of the purchase price when the property is sold 5 years after its initial acquisition (and if it was not just some piece of land).

    Warning : 15% lump sum cannot be used if the seller is a legal entity.

Supporting Documents

  • You have to produce company's invoices with legal mentions (art. 289 of French Tax Code)
  • You have to produce proof of payment (bank statements of the seller).


French Tax Rules

Art. 150 VB II 4° of French Tax Code BOFIP