Social security contributions on rental income and property gains

Social security contributions on property income and property capital gains concern a large proportion of owners, whether they live in France or elsewhere. For rent from an unfurnished property and for individuals’ property capital gains, the principle is clear: this income falls within the scope of social contributions, with specific adjustments depending on your affiliation to a social security scheme.

To properly understand social security contributions on property income, three questions must be distinguished: the income concerned, the rate actually applicable according to your situation, and how these amounts are collected. On the Alabaster Coast, where many properties are held as second homes or rented out year-round, this distinction helps avoid errors when declaring rent or selling a property.

Key points to remember

• Property income from an unfurnished rental and property capital gains of individuals are among the income subject to social security contributions.
• As a general rule, rental income and property capital gains are subject to 17.2 % in social contributions, while non-professional furnished letting is subject to 18.6 %.
• If you live in France, work in an EEA country or in Switzerland and are covered by that state’s compulsory social security scheme, CSG and CRDS do not apply; the solidarity levy of 7.5 % remains payable.
• For property income declared on time, the tax notice is sent between August and September.

Which property income is concerned

According to Service-Public.fr, social security contributions apply in particular to the following income when it concerns individuals’ real estate assets:

• property income from an unfurnished rental ;
• income from non-professional furnished letting ;
• individuals’ property capital gains.

For landlords, the first point to check is therefore to correctly identify the nature of the declared income. Rent from an unfurnished rental is classed as property income. A property sale generating a gain falls under the individual property capital gains regime.

This distinction is of particular interest to landlords hesitating between unfurnished and furnished rentals. Cabinet Soudey offers properties to rent year-round on the Alabaster Coast, and its property management with PCG Gestion concerns specifically year-long residential leases, not short-term letting.

Resident or non-resident : the same income concerned

For this property income, being resident or non-resident does not change the rate: what matters is affiliation to a social security scheme.

If you are tax resident outside France

Certain income from French sources remains subject to social security contributions, including:

• property income received in France ;
• income from non-professional furnished letting ;
• property capital gains.

For non-resident owners, it is therefore unwise to assume that moving abroad automatically removes all social contributions on a property retained in France. The tax authorities also advise checking your situation with the relevant tax office, in particular via your account on impots.gouv.fr.

Rates according to your situation

Rates are not read in the same way depending on the taxpayer’s personal circumstances. For the most common property situations, the rates are as follows.

Two points requiring vigilance should be highlighted.

• The reduction to 7.5 % is not solely linked to living or working abroad. It requires affiliation to the compulsory social security system of an EEA country or Switzerland, depending on the cases defined by the authorities.
• For a non-resident wishing to benefit from this scheme, Service-Public.fr states that they must certify their situation on their honour and provide supporting documents if requested by the authorities.

If your circumstances changed during the year, or if you worked outside France while retaining a property in Seine-Maritime, discussing the matter with the tax office or a legal professional can help avoid an incorrect rate.

How the levies are paid

The method of payment depends on the nature of the income.

For property income

If you filed your income tax return on time, between August and September you will receive a combined tax notice for income tax and social security contributions. This notice gives details of and calculates the taxes, as well as the available payment methods.

In this case, you do not need to take any particular steps to pay social contributions on this income: they are charged together with the corresponding tax.

During the year, property income is also subject to a social-contributions instalment, paid under the same conditions and at the same intervals as the income-tax instalment deducted at source.

For property capital gains

When the property is sold, the notary calculates the taxable capital gain and files the declaration, together with payment of the tax and social contributions due. You must then report the amount of the capital gain on your income tax return.

For non-residents

If you submitted your declaration on time, the non-resident personal tax office will also send you, between August and September, a tax notice for your social security contributions, detailing the calculation and payment methods.

Cases of relief or exemption not to be confused

On this subject, confusion is common between income tax exemption and exemption from social security contributions.

An exemption is expressly provided for when you live in France, work in an EEA country or Switzerland and are covered by that country's compulsory social security scheme: in this situation, CSG and CRDS are not due, and the solidarity levy of 7.5% remains applicable. For non-residents, the authorities also indicate that certain French-source income is subject to social security levies, while other income is exempt.

Common example: for a property capital gain, the exemption based on length of ownership is acquired after 22 years for income tax, but only after 30 years for social security contributions.

For a sale, prudence means checking your status before signing and before making any declaration, particularly if you live outside France or work abroad. If the value of a property needs to be established in another context, such as an inheritance, gift or partition, a property valuation at market value may also meet a need distinct from capital gains taxation.

The most common mistakes made by owners and sellers

• Confusing tax residence with social security affiliation. The rate of 7.5 % does not derive solely from the place of residence.
• Forgetting the difference between unfurnished and furnished rentals. Property income applies to unfurnished rentals, whereas non-professional furnished letting falls under another category listed separately by the authorities.
• Wait until the sale to check your non-resident status. In certain cases, the administration requests a sworn statement and supporting documents.

For an owner who lets a property year-round or is considering selling it, checking the declarations and income classification in advance is often more useful than correcting them afterwards. If an appraisal of a property is needed before a family division, a market-value valuation follows a different estate-planning logic from the calculation of social security contributions.

Frequently asked questions