France's wealth tax today, the IFI (impôt sur la fortune immobilière), applies only to real estate: you pay it if your household's net property is worth more than €1.3 million on 1 January. Property held through an SCI or any company counts; bank accounts, shares in operating companies and euro-fund life insurance do not. A French tax resident is taxed on property worldwide, except during the first 5 years in France, when only French property counts. A non-resident is taxed only on property in France. Rates run from 0.5% to 1.5%, and the 2026 Finance Act left them unchanged.
Key facts
| Question | Short answer |
|---|---|
| Threshold | Net real estate above €1,300,000 on 1 January |
| Rates | 0.5% to 1.5%, calculated from €800,000 once over the threshold |
| French tax resident | Property in France and abroad |
| New arrival | French property only, for 5 years |
| Non-resident | French property only, including through companies |
| Main home | 30% reduction if you own it directly, not through an SCI |
| Debts | Loans linked to taxable property are deductible, under conditions |
| Couples | Married, PACS and cohabiting partners file together |
| Filing | With the income tax return, in spring |
Three questions to see if this applies to you
- Is your property worth more than €1.3 million, after deducting mortgages? The whole household and all property count: main home, second home, rentals, shares in SCIs or property funds.
- Are you French tax-resident on 1 January? If yes, property abroad counts too. If not, only property in France counts.
- Did you move to France less than 5 years ago, without having been resident in the 5 years before? If yes, your property abroad stays out for now.
Above the threshold in the first question, IFI is due. The other two decide which property it covers.
How much
| Net taxable value | Rate |
|---|---|
| Up to €800,000 | 0% |
| €800,000 to €1,300,000 | 0.50% |
| €1,300,000 to €2,570,000 | 0.70% |
| €2,570,000 to €5,000,000 | 1% |
| €5,000,000 to €10,000,000 | 1.25% |
| Above €10,000,000 | 1.50% |
Net property of €2 million pays about €7,400 a year; €3 million, about €15,690. A reduction applies between €1.3 and €1.4 million.
What counts, and what stays out
Property held directly counts (main home, second home, rentals, land), and so do shares in companies for the part of their value that reflects real estate: SCIs, property funds, foreign companies.
Cash, gold, art, euro-fund life insurance and, in principle, shares in operating companies stay out. Property used in your own business is exempt, under conditions.
The SCI: the most common mistake
Your main home gets a 30% reduction, but only if you own it directly. Held through an SCI, it counts at full value, even if you live in it.
Example. A Paris flat worth €1.5 million, used as the main home. Owned directly, it counts for €1.05 million: no IFI. Owned through an SCI, it counts for €1.5 million: about €3,900 a year, every year.
More generally, an SCI or a company does not take property out of IFI. Company debts that do not finance the property, and family loans to the company, are largely disregarded.
Residents, new arrivals, non-residents
- French tax resident: all your property counts, in France and abroad.
- New arrival: if you were not French tax-resident in the 5 calendar years before moving, only your French property counts until 31 December of the fifth year after you arrive. You must be able to prove that non-residence if audited.
- Non-resident: only property located in France counts, held directly or through a French or foreign company. No 30% reduction, and no income-based cap.
Example. A family moves to Paris in 2026. They live in a €1.5 million flat and keep a €2 million house in New York. Until IFI 2031, only the flat counts, at €1.05 million after the reduction: no IFI. On 1 January 2032, the New York house comes in: €3.05 million, about €16,190 a year. That switch is planned before it happens, not after.
For US citizens who are not French nationals, the France-US treaty has a comparable 5-year rule, which can start again after at least 3 years away. A tax treaty never shields French property held directly.
Mortgages and valuation
- A bank loan that financed the purchase or works on a taxable property is deducted for the capital outstanding on 1 January.
- A loan from your spouse is not deductible; a loan from another family member only if it is on normal terms and actually repaid.
- Property is declared at market value on 1 January. You set it, and the tax authorities can challenge it: comparable sales (the Patrim service on impots.gouv.fr) and a dated valuation protect you.
When it gets complicated
- You own property in several countries. After your first 5 years, property abroad enters IFI. The country where it sits may also tax it: the tax treaty decides whether France gives a credit.
- Your property is held by a foreign company. The shares enter IFI, and a company that does not disclose its shareholders may also owe an annual 3% tax on the property's value.
- A family SCI with shareholder current accounts. Poorly documented contributions and loans are one of the most audited points.
- Your holding company owns a home you live in. Since 2026, a 20% tax can apply to such structures, and an old planning structure can become expensive.
- You change residence during the year. Everything is assessed on 1 January: leaving on 15 January or arriving on 20 December has very different effects.
- Your income is low compared with your property. Residents can cap IFI by reference to income, but the cap is tightly framed, and a year with a large capital gain reduces its benefit.
A poor structure is paid for every year, often for a decade. Ownership and financing are chosen before you sign the purchase.
Buying, moving or reviewing an SCI? A short consultation is enough to see whether IFI applies to you and on which property.
Frequently asked questions
Do non-residents pay French wealth tax?
Yes, if their French property, held directly or through companies, exceeds €1,300,000 net on 1 January. Property abroad does not count.
Does an SCI avoid IFI?
No. SCI shares are taxed for the real estate they represent. And a main home held through an SCI loses the 30% reduction.
Does a mortgage reduce IFI?
Yes, the outstanding capital of a loan that financed taxable property is deductible. Family loans only under conditions.
Is property abroad subject to IFI?
Not for non-residents, nor for new arrivals during their first 5 years. After that, a French tax resident declares it with the rest of their property.
Related reading
- France's 20% tax on homes, yachts and cars held through companies
- French exit tax when leaving France
- French inheritance tax: rates, treaties, forced heirship
- The French impatriate regime
Two ways to move forward
You may be liable. You want to know whether you cross the threshold, how to value your property and SCI shares, and what to file, in France or from abroad. Book a consultation.
You are planning a purchase or a move. You are buying in France, moving here or restructuring your property, and want to choose financing and ownership before signing. Describe your situation and you will receive a proposal for full assistance.
General information under French law as at 1 November 2026. It is not legal advice for your situation.