Second home taxation in France: complete guide

Owning a second home in France generates three main tax obligations in 2026: the housing tax with surcharge (up to 60% increase in Paris), property tax without any deduction, and IFI (wealth tax on real estate) at full market value. Upon resale, capital gains are taxed at 36.2% with progressive allowances based on the length of ownership, with full exemption after 30 years.

Introduction

Owning a second home in Paris or Île-de-France entails an annual tax cost that should be calculated precisely before purchasing. Unlike a primary residence, which benefits from multiple tax advantages (housing tax exemption, 30% IFI deduction, full capital gains exemption), a second home bears the full weight of all levies.

This guide focuses exclusively on the tax aspects of second home ownership. For a broader investment approach (district selection, rental yield, wealth strategy), see our guide to second home investment in Paris.

Table of contents

• How much is the housing tax on a second home in Paris?
• Is property tax higher on a second home?
• How is a second home treated for the IFI?
• How much capital gains tax do you pay on a second home?
• How is the rent from a let pied-a-terre taxed?
• Which levers reduce that tax burden?

How much is the housing tax on a second home in Paris?

Budget 2,800 to 3,200 euros a year for a one-bedroom and more than 5,000 euros for a large central apartment, including the 60% Paris surcharge. The housing tax remains payable on second homes in 2026, even though it was abolished for primary residences in 2023: it is the most visible tax for pied-à-terre owners.

In Paris, the City Council voted a 60% surcharge on the housing tax for second homes, effective since 2024. This surcharge is the maximum rate allowed by law (the legal range is 5% to 60%). It is added on top of the base municipal rate and additional taxes (departmental, regional).

In practical terms, for an apartment with a cadastral rental value of 3,500 euros (which corresponds to a standard one-bedroom in a mid-range arrondissement), the housing tax reaches approximately 2,800 to 3,200 euros per year, surcharge included. For a large apartment in a central arrondissement, the amount can exceed 5,000 euros.

Exemptions exist in limited cases: people required to live away from their primary residence for professional reasons, people housed in retirement homes for an extended period, and owners of properties that have been vacant for more than two years (in which case they are subject to the vacant property tax, distinct from the housing tax).

In Île-de-France, surcharge rates vary by municipality. Some inner-suburb cities apply more moderate rates (20% to 40%), which may influence the choice of location for a second home investment.

Is property tax higher on a second home?

No: property tax applies equally to primary and secondary residences, with no surcharge and no specific advantage for either. In Paris in 2026 it runs from 800 to 2,500 euros a year for a one-bedroom and 2,000 to 5,000 euros for a large apartment, its amount depending on the cadastral rental value and the rates set by local authorities.

In Paris, property tax has increased significantly in recent years, driven by the revaluation of cadastral bases (+3.4% in 2024, +3.9% in 2023) and adjustments to municipal rates. That drift weighs on the holding cost of a pied-à-terre, year after year.

Adding the two annual taxes together, the holding cost of a Paris second home works out as follows.

Annual item	One-bedroom	Large central apartment
Housing tax, including the 60% surcharge	€2,800 to €3,200	Over €5,000
Property tax	€800 to €2,500	€2,000 to €5,000
Annual total	€3,600 to €5,700	€7,000 to €10,000 and above

To which the IFI is added if net real estate assets exceed €1.3m, without the 30% allowance reserved for a primary residence. Over ten years of ownership, the two taxes alone come to €36,000 to €57,000 for a one-bedroom: a figure to build into the calculation before buying a pied-à-terre, not after.

Our detailed guide to property tax in Paris covers the calculation bases, rates by arrondissement and the rare cases of exemption (new-build properties exempt for two years, energy efficiency renovations under certain conditions).

Combining the housing tax and property tax, the annual tax cost of owning a second home in Paris comes to 3,600 to 5,700 euros for a one-bedroom apartment, and 7,000 to 10,000 euros for a large central apartment: in the region of 0.5% to 1% of the property’s value. This ratio must be factored into the overall return calculation.

How is a second home treated for the IFI?

Second homes are included in the IFI tax base at their full market value, with no deduction whatsoever. This is a major difference from the primary residence, which benefits from a 30% deduction.

For a Parisian pied-à-terre valued at 800,000 euros, the entire value is added to the taxable real estate wealth. If the owner also has a primary residence worth 1 million euros (valued at 700,000 euros after the deduction), the total IFI taxable wealth reaches 1,500,000 euros, meaning a tax of 3,900 euros per year: (500,000 x 0.50%) + (200,000 x 0.70%).

The only possible deduction concerns debts related to the second home: acquisition loan, renovation loan, property tax due on January 1st. A property financed 70% by a mortgage will only be declared at 30% of its market value for IFI purposes.

The IFI optimisation strategies (usufruct splitting, SCI) detailed in our IFI guide apply to second homes. Usufruct splitting is particularly relevant: by granting temporary usufruct of your pied-à-terre to an adult child who occupies it, you remove the property’s value from your IFI base.

How much capital gains tax do you pay on a second home?

Capital gains are taxed at 36.2%: 19% income tax plus 17.2% social contributions, with allowances for length of ownership from the 6th year. Income tax exemption is reached after 22 years and social contributions exemption after 30 years, and the calculation involves several steps.

Gross capital gain calculation: sale price minus the purchase price (increased by actual or flat-rate acquisition costs at 7.5%) and renovation expenses (actual or flat-rate at 15% after 5 years of ownership).

Allowances for length of ownership on income tax (19%): 6% per year from the 6th to the 21st year, then 4% in the 22nd year. Full exemption after 22 years.

Allowances for length of ownership on social contributions (17.2%): 1.65% per year from the 6th to the 21st year, 1.60% in the 22nd year, then 9% per year from the 23rd to the 30th year. Full exemption after 30 years.

Surtax on high capital gains: for net capital gains exceeding 50,000 euros, a surtax of 2% to 6% is added. It applies in progressive brackets up to 260,000 euros, beyond which the rate is fixed.

Worked example: a property bought for 600,000 euros and sold for 800,000 euros after 12 years of ownership. Gross capital gain: 200,000 euros. After the flat-rate deduction for costs (7.5% = 45,000 euros) and renovations (15% = 90,000 euros), adjusted capital gain: 65,000 euros. On the income tax side, the 42% allowance (7 years at 6%) brings the base down to 37,700 euros, so 19% = 7,163 euros. On the social contributions side, the allowance is only 11.55% (7 years at 1.65%): the base comes to 57,493 euros, so 17.2% = 9,889 euros. Total tax: approximately 17,050 euros.

A special exemption exists if the sale proceeds are reinvested in purchasing a primary residence within 24 months, provided the seller has not been a homeowner of their primary residence during the preceding four years.

How is the rent from a let pied-a-terre taxed?

As property income for an unfurnished let (micro-foncier and its 30% deduction below 15,000 euros of receipts), as BIC for a furnished let (micro-BIC and its 50% deduction below 77,700 euros), with 17.2% social contributions in both cases. If you rent out your second home during your absences, that rental income is taxable and the tax regime depends on the type of rental.

For unfurnished rentals (revenus fonciers): micro-foncier regime if income is below 15,000 euros (30% deduction) or the actual expense regime (deduction of charges, renovations, loan interest). Property income deficits can be offset against overall income up to 10,700 euros per year.

For furnished rentals (BIC): micro-BIC regime if income is below 77,700 euros (50% deduction) or the actual expense regime (deduction of charges and depreciation of the property and furniture). The actual regime is often more advantageous for Parisian properties. Our furnished rental guide details the LMNP and LMP regimes.

For seasonal rentals: income falls under the BIC regime (furnished tourism). The micro-BIC regime historically offered a 71% deduction, but the Le Meur law of 19 November 2024 cut it to 30%, capped at 15,000 euros of receipts, for unclassified tourist furnished properties. Classified furnished properties retain a 50% deduction, capped at 77,700 euros.

Social contributions (CSG-CRDS at 17.2%) are added to income tax for all regimes. Rental income from a second home is subject to social contributions, including for non-residents (with nuances depending on tax treaties).

Which levers reduce that tax burden?

Four levers: temporary usufruct splitting in favour of an adult child, loan financing which reduces the IFI base, ownership through an SCI, and the timing of the resale, with income tax exemption acquired after 22 years. None of these strategies circumvents legal obligations, and all of them reduce the overall tax burden of a second home.

Temporary usufruct splitting: granting usufruct of your pied-à-terre to an adult child for 10 to 15 years removes the property from your IFI base, transfers the housing tax to the usufructuary and prepares the estate transfer. The value of temporary usufruct is calculated at 23% of the full ownership value per 10-year period.

Loan financing: debts related to the second home reduce the IFI base. Even if you have the funds available, borrowing can be fiscally rational when the cost of credit is lower than the IFI savings. See our 2026 mortgage guide.

Ownership through an SCI: the SCI allows estate planning through share donations with a discount, and offers management flexibility for co-owners.

Planning the resale timing: by scheduling the sale after 22 years of ownership, you benefit from full income tax exemption on capital gains. After 30 years, the exemption is total, including on social contributions.

A property hunter in Paris does not replace a notaire or a tax advisor, but integrates these parameters from the search phase onwards to select properties whose tax profile is consistent with your strategy.

---

Would you like to assess the tax burden of a second home in Paris? Our property hunters incorporate tax analysis into their support. Contact Home Select for a personalised assessment.