Britons with second homes in France may choke on their croissants when they are hit with their latest property tax bill in the coming weeks. The French government is ramping up property taxes for owners of holiday homes in popular tourist areas.

If you’re a Brit with a second home in France, you may soon find yourself facing a hefty property tax bill. The French government is cracking down on second homes in areas where there is a housing shortage, and as a result, some homeowners may see their tax bill rise by as much as 60 percent.

In France, there are two main property taxes: taxe foncière (ownership tax) and taxe d’habitation (residence tax). The taxe foncière is paid by the owner of a property, regardless of who occupies it, while the taxe d’habitation is paid by the occupier and is similar to council tax in the UK. Last year, the average taxe d’habitation for a house was €772 (£660), and for a flat, it was €941 (£800).

As of 2023, the taxe d’habitation is abolished for those owning one residence. However, it still applies to second homes and additional properties, including those owned by Britons. The French government has introduced a surcharge of between 5 percent and 60 percent on this tax, which could be applied in 2024.

Initially, the surcharge was limited to 1,136 councils in big cities and tourist resorts, where last year property taxes increased by 60 percent in areas such as Bordeaux, Lyon, and Biarritz. For example, the city council of Paris declared a 51.9 percent property tax rise. Now, the French government has given an additional 2,263 rural areas the option to roll out increases to the tax by the same amount.

Christophe Du Tertre, a specialist at FranceTax Law.com, warns that there is still a lot of uncertainty surrounding the tax rates for 2024. Homeowners can expect some clarity towards the end of the year, but it remains unknown whether the taxes will increase again at some point. One thing is certain, though: property taxes are on the rise for second homeowners in France, which will affect thousands of Britons with holiday properties there.

For instance, in Brittany, 156 councils have been authorized to increase the residence tax by up to 60 percent, affecting around 12 percent of the region’s properties that are second homes. An estimated 8,900 Britons may be hit by the tax hike. In the Jura region of eastern France, Lebby Eyres, who has owned a second home with her French husband for the past 11 years, expects her total annual property tax bill to rise from €2,000 to around €2,500.

The rising property taxes are an additional blow to Britons who are already facing restrictions on spending time in their holiday homes in Europe. Since Brexit, British citizens can no longer stay in EU countries for more than 90 days in any 180-day period.

According to the English Housing survey, approximately 809,000 Britons own second homes, with 60 percent of them located in the UK. This suggests that more Britons are favoring holiday homes within their own country. The number of Britons owning a second home in France has decreased by a third since 2012, from around 90,000 to an estimated 60,000.

The increased bureaucracy and limitations imposed by Brexit have also pushed some Britons to sell their properties in France. Susan and Chris Beesley recently sold their chalet in the French Alps due to decreasing bookings during the pandemic and the inability to stay for the full season after Brexit. They were paying around €1,500 a year for the taxe d’habitation and €1,950 for the taxe foncière.

Owning a property overseas can have its advantages, but it’s crucial to understand the rules and be aware that they can change depending on the government in power. As the dream of owning a holiday home in France becomes more challenging, potential property investors need to carefully consider the financial implications and potential tax increases before making any commitments.

It’s still uncertain how much property tax bills for second-home owners will rise, and homeowners will have to wait to see how their specific areas will implement the tax increases. If you’re considering investing in property in France, it’s essential to weigh the potential benefits against the rising taxes and other restrictions that may affect your ability to enjoy and profit from your investment.