Deductible expenses from property income

November 2017

Some fees may be charged to the land incomes. The point of all deductible expenses of rental income landlords.

Deduction rules

The charges can be deducted from taxable gross income property of the lessor for the amount tax (except for leasing subject to VAT).

The charges related to a rental exempt are not deductible.

Generally, non-deductible expenses from property income are included in the cost of the property for the calculation of the taxable real estate gain.

loan interest

Interest and borrowing costs (administrative costs, etc.) are deductible from gross income when land loans were contracted for conservation, acquisition, construction, repair or improvement of the property.
As part of the conservation of the property, interest on loans contracted for the payment of inheritance tax or gift tax on a leased property are deductible from gross income the new owner, which benefited from the transfer free of charge.

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The landlord may deduct the cost of land revenue work to bring an element of comfort in a new dwelling, provided that such work does not alter the overall consistency of the room.
Examples: health facility, central heating, security system, lift, installation of shutters, intercom, community antenna, etc.
We must distinguish these improvement works expansion, construction or reconstruction, which is not deductible to the extent that they change the structure, volume, or the layout of the building.

In other buildings (shops, offices, etc.), only the improvements intended to promote the reception of disabled deductible (ramps construction, etc.). Also deductible asbestos removal and improvement expenses to protect the premises of the effects of asbestos.

See The improvements deductible from property income.

Maintenance and repair work

The landlord can deduct the cost of work to keep the local in good condition without changing the structure, volume or arrangement: restoration of electrical, roof, boiler replacement, etc.
These expenses can not be deducted when they are inseparable from construction, reconstruction or expansion.

If it works normally incumbent on the tenant (change of floor covering, wallpapers, etc.), these expenses are only deductible if incurred in order to facilitate the relocation of the good (refurbishment) or if they are made necessary by the construction works themselves deductible (painting after renovation of the electrical installation, etc.).

Other maintenance and repair deductible from property income.

Dues and taxes

All taxes incumbent on the owner's land deductible gross income (and any penalties and interest for late payment): property tax, capital tax, tax on offices in Ile-de-France, etc. But taxes considered as an element of the cost price of the good (transfer taxes, etc.) can not be expensed as they are considered in calculating the taxable gain.

Insurance premium

Insurance premiums to cover any type of risk are deductible. In return, the compensation paid by the insurer are included in land revenue.

Management fees

Are deductible compensation paid to third parties for property management, remuneration paid to guards and janitors, including benefits in kind which they benefit and social charges, litigation costs incurred in the action used in justice, etc.

standard deductions

In some cases, landlords can still practice certain standard deductions

See also

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