There are three capital gains tax returns to submit depending on the type of property you have sold – buildings, land or property companies.
These are the forms that need to be completed for each type of property:
- Form 2048-IMM – for declaring CGT on buildings
- Form 2048-TAB – for declaring CGT on land alone
- Form 2048-M – for declaring CGT on property companies
You do not have to submit a CGT return if the sale is fully exempt from French CGT for whatever reason or if there is no French capital gains tax to pay (for example if you make a capital loss).
The deadline for submitting the return is one month after the date of completing the sale – this date is shown on the contract. The tax is due for payment at the same time as the return is submitted.
If you are resident in France for tax purposes, the gain must also be declared on your French income tax return. You do not pay additional income tax on the gain, but it needs to be declared on the income tax return.
Notaries normally declare and pay the CGT
By law, the sale of a French property must be overseen by a notary. The notary is responsible for preparing the contract. Part of their job is to calculate and declare any French CGT due. They will retain the tax from the sale price and pay it over to the French tax authorities. You therefore receive the sale proceeds after the French CGT has been paid.
In some cases, you the seller will have to declare and pay the French CGT. This can happen for example if you are resident in France for tax purposes, but sell a property in another country where a French notary would not be involved in the sale. French CGT will normally be due if there is no double tax agreement with that country or if the double tax agreement does not stop France from taxing the gain. This is the case for example with the UK.
Representative for non-French residents
If you are not resident in France for tax purposes, you may have to nominate a representative in France who takes on a legal obligation to declare and pay the CGT. A representative is not necessary in the following cases:
- You are resident in another European Union member country, Norway or Iceland.
- The sale price is less than €150,000.
- The sale is exempt because the property has been held for 30 years or more.
- The property you are selling is your former main home in France.
Whilst the UK was in the EU, a representative was not necessary for UK tax residents. But following Brexit, if you are a UK tax resident selling a French property after the transition period ends on 31 December 2020, you will need to appoint a representative unless you fall under one of the other three categories above.
The representative can be the person you are selling to, a bank or a person/organisation who is authorised by the French tax authorities.