The 2025 finance law introduced few visible changes concerning the taxation of furnished rentals. However, behind a facade of stability, the legal framework is evolving, and sometimes in an insidious way, calling into question certain achievements. The very qualification of “furnished rental company” is subject to interpretation, while the rules on the taxation of capital gains, VAT liability and specific regimes are undergoing significant adjustments. Deciphering the new rules and grey areas.
Article 84 of the 2025 Finance Law reforms the way in which the capital gains of non-professional furnished renters (LMNP) are calculated, whether they are under the micro-BIC regime or under simplified real terms! Until then, accounting depreciation deducted from rental income was not reintegrated when the property was resold, a tax advantage described by some as a “niche”.
➤ What's changing in 2025:
The purchase price used to calculate the capital gain is now reduced by the amount of depreciation deducted, pursuant to article 39 C II of the CGI. This mechanically increases the taxable capital gain.
• Capital gain tax: 19% (income tax) + 17.2% (social security contributions).
• Exemptions for length of detention: exemption from IR after 22 years, and total exemption (IR + social) after 30 years.
That being said, the depreciation reinstatement rule applicable to individuals follows essentially the same tax rule as that of companies which, when reselling their real estate assets, take into account the net book value in calculating capital gain.
➤ What is still possible to deduct:
• Acquisition costs (real or flat rate of 7.5%).
• Eligible work (real or 15% flat rate).
However, there is still a lack of clarity on the exact calculation method, in particular in two critical cases:
a) Micro-BIC: total uncertainty
Taxpayers under the micro-BIC regime do not have accounts that allow amortization to be identified. The notice for form 2048-IMM-SD published in March 2025 does not mention them, suggesting an exemption... without any clear legal basis.
Our advice: If you are in micro-BIC status, do a comparative study with the LMNP status in simplified real life, especially if you rent your accommodation all year round.
b) Real regime with multi-assets: the global depreciation puzzle
For taxpayers with several assets in assets, depreciation is calculated globally. When selling a property, it is difficult to isolate it. The tax authorities then propose a proratization calculation based on the stock of depreciation not deducted. A pragmatic but criticisable method, and a source of potential errors.
Our advice: Keep cost accounting.
Faced with this tightening, certain categories of residences benefit from derogatory tax treatment. They avoid the reintegration of depreciation into the calculation of capital gains.
➤ Residences concerned:
• Nursing homes (EHPAD) — art. L6143 CSP
• University residences — art. L631-12 CCH
• SAP approved senior service residences — art. L631-13 CCH
• Medico-social establishments — art. L312-1 CASF
⚠️ Not concerned: classified tourist residences, formerly eligible for the Censi-Bouvard system, now excluded.
➤ Persistent ambiguities:
• Private student residences under commercial lease: their eligibility is uncertain, as they do not fall under the strict administrative status of university residences managed by CROUS.
• Private senior service residences: if they do not meet the SAP approval criteria or do not provide the required non-individualized services, they are also excluded.
The opinion of the Council of State of 5 July 2023, transposed into the 2024 Finance Law, amends the VAT liability rules. This was followed by the modification of article 261 D° b of the General Tax Code, which adds an additional criterion of length of stay not to exceed 30 days, as defined by the Tourism Code.
Two categories are now distinguished:
• Hotel sector or similar: short-term tourist rentals (≤ 30 days).
• Residential sector: long rentals or without hotel services.
❗ Our advice: In order for your status to be requalified for VAT purposes, the Council of State has nevertheless raised the criterion of “potential competitive situation with hotel establishments”. Carefully study the competitive situation of your accommodation with the local hotel offer, the length of stays and the services offered to adapt your strategy.
➤ Towards a requalification in the para-hotel industry
A certain number of furnished tourist apartments could be considered as exercising a para-hotel activity if they provide certain services such as:
• Customer reception, even electronic
• Breakfast is charged
• Cleaning (even done)
• Household linen replaced regularly
Recent decisions of the Administrative Courts of Appeal (Lyon, Douai) validate this approach, even if only two out of four services are provided.
Para-hotel status is a professional status that requires a well-prepared exercise with discipline. If you fall under this regime or if you wish to benefit from it, it is possible to delegate the total management of your accommodation (s) to a professional, who will have to implement a contract that meets the requirements for compliance with the fiscal rules set out by the General Tax Code. This includes in particular respecting your capacity as an operator, who assumes all risks and is responsible to customers, and who offers hotel services well. In addition, the accommodation must be adapted and equipped like a hotel.
https://bofip.impots.gouv.fr/bofip/124-PGP.html/identifiant%3DBOI-TVA-CHAMP-10-10-50-20-20120912
❗ Our advice: Be accompanied by a professional operator
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• Transition to the mandatory VAT regime
• Change in accounting treatment (depreciation, recoverable VAT, etc.)
• Loss of the LMNP regime, with possible requalification into professional activity
• Recovery of VAT on investments and expenses
• Exemption from professional capital gains after 5 years (article 151 septies of the General Tax Code)
• Exemption from IFI
• Allocation of deficits to total income
Read our article Parahotellerie_Taxation_2025
The taxation of furnished rentals in 2025 is still, for the most part, a changing field. Between technical adjustments, requalification risks and regulatory uncertainties, investors need to be extra vigilant.
It is imperative to:
• Take stock of your tax regime (micro-BIC vs real),
• Anticipate the sale of a property in order to master the calculation of capital gain,
• Verify the nature of the residence in which one invests,
• Evaluate the services offered to tenants to avoid VAT requalification.
For LMNP/LMP investors, 2025 is not the year of abrupt change, but it could well be the year of structural change. A regular update with a tax advisor specializing in furnished tourist rentals is more recommended than ever.
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