Did you think that exchanging your home had no tax consequences? This is not the case, since a cashless exchange is not tax neutral. “ The DGFiP (Editor’s note: the General Directorate of Public Finances) apprehends it according to two alternative analysis gridsexplains Franck Lobe, tax lawyer. Either like a exchange of services for consideration — each party providing a housing service to the other in return for an equivalent service received — either as two free supplieswithout taxable consideration “.
Concretely? It all depends on the terms of the exchange: Is it simultaneous or staggered over time? Is there a points, credits or compensation system managed by a platform? Do the goods have a different value or the same value? “ In the absence of published administrative doctrine specific to home exchange, the DGFiP has a latitude of interpretation that the taxpayer must anticipate », Adds the expert.
Three possible regimes
Three regimes can be used depending on the nature and conditions of the exchange. THE regime of taxable incidental income is that applicable to amounts not falling into any other category. “ If the tax authorities consider that the exchange constitutes a service provided for consideration, the benefit received – valued by reference to market rents – is taxable in this category, at the progressive scale of income tax, without forgetting social security contributions.specifies Franck Lobe. The official bulletin confirms that the list of taxable products in this category is non-exhaustive.“.
In the event of compensation (points system for example), the provision can be reclassified as benefit in kindit would then be the value of the accommodation which would constitute a taxable gain according to the market price of the rental. In the event of a usual and organized exchange, “ several exchanges per year, use of one or more platforms, systematic approach », he summarizes, this can be considered as industrial and commercial incomelike a short-term furnished rental. “ To date, the DGFiP has not published a doctrine specifying the regime applicable to pure home exchange (without points or monetary compensation system)reveals the tax specialist. So it’s a gray area, but not without risk“.
Everything to declare
In the case of a benefit in kind or recoverable income, it must be reported on the income tax return in the applicable category (BNC or BIC incidental income). “ Today, the safest approach consists of document the operation (exchange contract, housing market price received, duration) and to anticipate the position of the DGFiP during an inspectionadvises Franck Lobe. Especially since digital platforms established in the European Union are required to report transactions of their French tax resident users. Even when the exchange is non-monetary, the provision data may be transmitted “.
Please note that sums derived from property located in France are in principle taxable in France, subject to applicable tax conventions, for non-French tax residents who own property made available via an exchange. What are the risks in the event of non-declaration? Tax adjustment over the last three years, social security contributions And late payment interest : “ If deliberate failure is proven, the increase is 40%; 80% for fraudulent maneuvers, alerts the lawyer. Social security contributions at 18.6% on property income, as well as late payment interest of 0.20% per month, are added to tax reminders “.
