Taxes for property owners in Paris

A property owner in Paris must pay several recurring taxes: property tax (all owners), residence tax (secondary residences only since 2023), IFI (property portfolios exceeding 1.3 million euros) and capital gains tax upon resale. In 2026, these tax charges represent an essential parameter in the total cost of owning a property in the capital.

Introduction

Buying an apartment in Paris means acquiring a solid wealth asset, but also accepting a specific tax framework. Between annual property tax, the secondary residence surcharge, the IFI for large portfolios and the taxation of capital gains on resale, the Parisian tax framework affects the profitability of an investment and the cost of holding a residence.

In 2026, these taxes have evolved: the property tax rate has been reassessed, the secondary residence surcharge has risen to 60% and the capital gains abatement schedule remains unchanged. This guide reviews each tax, with calculations applied to the Parisian market.

Table of contents

• Property tax in Paris: calculation and amounts
• Residence tax and secondary residence surcharge
• The IFI: threshold, rate scale and optimization
• Capital gains tax on property
• Other tax charges for the Parisian owner
• Tax impact in the buying strategy

Property tax in Paris: calculation and amounts

The property tax on built properties (TFPB) is owed by every owner on January 1st of the tax year. Its calculation is based on the cadastral rental value of the property, revalued annually, to which the rates voted by local authorities are applied.

Paris has historically benefited from some of the lowest property tax rates in France. In 2026, the overall rate (municipal plus departmental component) is approximately 20.5%. For comparison, rates exceed 50% in some suburban municipalities.

The cadastral rental value, the basis of the calculation, does not reflect the market value of the property. It corresponds to a theoretical rent calculated using criteria dating from 1970, revalued annually by a flat-rate coefficient. In 2026, this revaluation coefficient is approximately 3.9%, which mechanically increases property tax.

For a 70 sqm apartment in the 11th arrondissement, with a net cadastral rental value of approximately 5,000 euros, property tax amounts to approximately 1,025 euros. For an equivalent property in the 7th arrondissement, with a higher cadastral rental value, the tax can reach 1,500 to 1,800 euros.

Owners carrying out energy efficiency works may benefit from a temporary 3-year property tax exemption, subject to conditions. An owner who improves their property’s energy performance rating can therefore temporarily reduce their tax burden.

Residence tax and secondary residence surcharge

The residence tax on primary residences has been fully abolished for all households since 2023. This abolition does not apply to secondary residences, which remain fully subject to the tax.

In Paris, the residence tax on secondary residences has been increased by a 60% surcharge since 2024, in accordance with article 1407 ter of the General Tax Code. This surcharge is added to the base tax, bringing the total amount to a significant level.

For an apartment in the 16th arrondissement used as a secondary residence, the surcharged residence tax can reach 2,500 to 5,000 euros per year depending on the surface area and cadastral rental value.

This discouraging taxation aims to encourage the rental of vacant properties in a city where rental tension remains high. For foreign investors or expatriates who maintain a pied-a-terre in Paris, this charge must be factored into the profitability calculation.

A few exemption cases exist: persons required to reside away from their home for professional reasons, persons housed in care facilities, and properties declared for seasonal rental. These exemptions are strictly regulated and require an application to the tax office.

The IFI: threshold, rate scale and optimization

The IFI (Impot sur la Fortune Immobiliere, real estate wealth tax), which replaced the former ISF in 2018, applies when the net value of the household’s property portfolio exceeds 1.3 million euros on January 1st of the tax year.

In Paris, where the average price per sqm is approximately 10,000 euros, a 130 sqm family apartment in a central arrondissement often exceeds the liability threshold. The taxable property portfolio includes the primary residence (with a 30% deduction), secondary residences, rental properties and shares in property companies (SCI).

The 2026 IFI scale is progressive. The portion of the portfolio between 0 and 800,000 euros is exempt. The portion between 800,000 and 1.3 million euros is taxed at 0.50%. The portion between 1.3 million and 2.57 million euros is taxed at 0.70%. The portion between 2.57 million and 5 million euros is taxed at 1%. The portion between 5 million and 10 million euros is taxed at 1.25%. Above 10 million euros, the rate is 1.50%.

The 30% deduction on the primary residence significantly reduces the taxable base. A primary residence valued at 2 million euros enters the IFI base at 1.4 million euros. Outstanding property loans are deducted from the gross portfolio value.

For buyers of luxury properties, the IFI is a structural parameter of wealth strategy. Using a mortgage, even when the buyer has sufficient cash, can be justified by optimizing the IFI base.

Capital gains tax on property

Capital gains realized on the resale of a property are taxed, unless exempt. The regime distinguishes between the primary residence, which is fully exempt, and other properties (secondary residences, rental investments), which are subject to taxation.

Capital gains are calculated as the difference between the selling price and the purchase price, increased by acquisition costs (actual notary fees or a flat 7.5%) and the cost of works (actual amount or a flat 15% if held for more than 5 years).

The tax rate combines income tax (19%) and social contributions (17.2%), for a total rate of 36.2%. A surcharge applies to capital gains exceeding 50,000 euros, potentially bringing the effective rate up to 42.2%.

A holding period abatement system progressively reduces the taxable base. For income tax purposes, full exemption is reached after 22 years of ownership. For social contributions, full exemption occurs after 30 years.

In Paris, where prices have generally risen over the long term, capital gains on resale are often significant. An apartment purchased for 500,000 euros in the 10th arrondissement in 2015 and resold for 680,000 euros in 2026 generates a gross capital gain of 180,000 euros, reduced by holding period abatements (11 years).

The primary residence benefits from full capital gains exemption, regardless of amount and holding period. This exemption is one of the most powerful tax advantages in the French system.

Other tax charges for the Parisian owner

Beyond the four main taxes, the Parisian owner must consider other charges.

The household waste collection tax (TEOM) is collected together with property tax. Its amount, varying by arrondissement, sits between 200 and 500 euros per year for a standard Parisian apartment.

The contribution on rental income (CRL) of 2.5% applies to rents received by landlords of residential properties completed more than 15 years ago. For a buy-to-let investment generating 24,000 euros in annual rent, this contribution amounts to 600 euros.

Owners of properties vacant for more than two years are liable for the vacant property tax (TLV), whose progressive rate can reach 25% of the cadastral rental value from the second year of vacancy.

For co-owners, co-ownership charges are not a tax in the fiscal sense but represent a significant holding cost, averaging 30 to 50 euros/sqm/year in well-maintained Parisian buildings.

Tax impact in the buying strategy

Property taxation should be factored in from the search phase, not discovered after the purchase. At Home Select, our property hunters systematically make their clients aware of the tax implications of each acquisition.

For a buy-to-let investor, the choice of tax regime (micro-foncier, regime reel, LMNP) directly impacts net profitability. A property displaying a 4% gross yield can drop to 2.5% after factoring in property tax, charges and rental income taxation.

For a secondary residence buyer, the 60% residence tax surcharge and the absence of the IFI primary residence deduction must be quantified before any decision.

For a foreign buyer, the tax treaty between France and their country of residence determines the treatment of property income and capital gains. A preliminary wealth analysis with a tax advisor is recommended.

Knowledge of Parisian property taxation is part of the expertise our property hunters bring to every client. It allows anticipating the real cost of ownership and making informed purchase decisions.

FAQ

What is the average property tax amount in Paris in 2026?

The property tax rate in Paris is among the lowest in France (approximately 20.5% in 2026, including municipal and departmental components). For a 70 sqm apartment valued at 700,000 euros, annual property tax ranges from 800 to 1,800 euros depending on the arrondissement and the cadastral rental value.

Does the residence tax still exist in Paris in 2026?

The residence tax on primary residences has been abolished for all households since 2023. However, it remains due for secondary residences. In Paris, a 60% surcharge applies to secondary residences, bringing the total amount to significant levels.

At what threshold does the IFI apply in Paris?

The IFI (Impot sur la Fortune Immobiliere) applies when the net value of the property portfolio exceeds 1.3 million euros on January 1st. The rate scale is progressive, from 0.5% to 1.5%. A Parisian apartment valued at 1.5 million euros with a remaining loan of 300,000 euros has a net value of 1.2 million euros and is therefore not subject to the IFI.

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Want to anticipate the tax implications of your Paris property purchase? Our property hunters integrate tax analysis into every acquisition project. Contact Home Select for full support.