Important changes in France from 2025 for vacation rentals

Depreciation now included in capital gains calculation

Depreciation allows landlords to deduct part of the value of their property for tax purposes each year. However, until 2024, these depreciations were not taken into account when calculating capital gains when the property was sold. That’s about to change with the new 2025 budget law.

According to Article 24 of this law, when you sell your property, any previously deducted depreciation will need to be added back when calculating the taxable capital gain.

Good to know: in most cases, this measure has no major financial impact, unless the property is sold. For transfers via gift or inheritance, there is no impact.

Adjustment of thresholds and cost flat rate postponed to 2025

The 2024 French budget law originally planned to lower the income thresholds and flat-rate deductions for furnished rentals, retroactively from the 2023 income year. This measure was approved by the French parliament on 29 January 2024.

However, the Le Meur law has postponed the implementation of these changes to 1 January 2025.

For more details on these thresholds, take a look at our article: French Budget Law 2024: Impact on the rental of furnished holiday homes.

Stricter energy performance requirements for vacation rentals

As part of the Climate and Resilience Law (Loi Climat et Résilience), France is tightening energy performance requirements for vacation rentals. In practical terms, this means your property will need to meet minimum energy standards (DPE) to be eligible for short-term rental.

The new rules for 'logements meublés de tourisme' are:

• Between 21 November 2024 and 31 December 2033: Your property must have a DPE rating between A and E.

• From 1 January 2034 onwards: Only properties with a DPE rating between A and D will be eligible for rental as holiday accommodation.

These regulations allow municipalities to only approve an application for short-term rentals if the property has a DPE score of E or higher. From 2034, all holiday homes - classified or not - must have a DPE score of D or higher.

What does this mean for landlords?
You may be required to make energy-efficient renovations to continue renting out your property and stay competitive in the rental market.

Mandatory registration of vacation rentals

Do you rent out your second residence in France as a holiday rental or a chambre d’hôte? Then you are required to register your property with the local municipality. Only then will your property be officially recognised as a meublé de tourisme or chambre d’hôte.

If you haven’t registered yet, you can do so easily online using this link:
Déclarer en mairie un meublé de tourisme ou une chambre d'hôtes (Démarche en ligne) | Service-Public.fr