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The government has extended until December 31, 2017 the tax system of Pinel, which aims to renew the rental investment in new property or rehabilitated. The tax reduction granted by this device depends on many conditions, including the continuity of the lease. The vacancy rate can lead to a loss of the tax advantage.
The rental investment in the framework of the tax Pinel is the subject of a lot of advertising. The real estate developers see it as an argument to attract investors. As attractive as it is, such an investment may entail many pitfalls detailed in the article 10 pitfalls of rental investment Pinel – an article, sadly, still topical.
One of the pitfalls is the vacancy rate, that is to say, the prolonged absence of the tenant satisfying the prescribed conditions. A reader (or a reader) careful(e) has raised the question in a comment to the article cited above :
What are the consequences, in particular in term of reduction of tax, if the property is vacant part of the year ? This question is asked to find the first tenant, but also during the 12 years that follow.
The vacancy may result in the requirement to repay the tax reduction
A dwelling in which the owner has received a tax reduction under the tax system of Pinel must be rented so that "effective and sustained" during the period of the lease commitment related to the reduction of tax (either 6, 9 or 12 years).
The lease is effective if it complies with the conditions on the nature of the accommodation, the quality of the tenant, amount of rent etc detailed in my article investment Pinel in 10 questions and answers.
The rental is continuous if the accommodation is let out quickly and do not remain vacant beyond a certain period.
A vacancy prolonged is in fact considered as a non-compliance of the lease commitment, it puts into question the tax reduction that must be repaid according to the terms and conditions laid down in article BOI-IR-RICI-360-40 and article BOI-IR-RICI-230-60 of the general tax code. Either :
If the owner made an initial commitment of 6 years or 9 years, and that the vacancy prolonged occurs during this time, the tax on the income of the year of the vacancy is increased by the total amount of the tax reduction obtained – in other words, it is necessary to reimburse it.
If the owner extended his original commitment for a period of 3 years and that the vacancy occurs during this period of extension then the tax on the income of the year of the vacancy is increased to the amount of the tax reduction obtained during this three-year period.
In both cases, the "recovery" by the tax must be made within 3 years after the problem.
First hiring-out of time
A first problem may occur if the dwelling is not leased within the prescribed time. The first rental must be made within a period of 12 months from the following dates :
date of acquisition if it comes to the purchase of a home is completed,
date of completion of the work if it is an ongoing rehabilitation at the time of purchase,
date of completion of the construction, if it is a dwelling purchased in future state of completion, that is to say, in construction.
Relocation in case of leave of the tenant
In the case of leave of the tenant during the period covered by the lease commitment, the accommodation must be immediately handed over in rent. A period of vacancy does not exceed 12 months from the date of receipt of the registered letter by which the tenant has signified his leave to the owner.
Note that the 12 months start running from the date of receipt of the letter of leave of the tenant, so well before the departure date of the tenant who must give her leave, with one or three months notice, depending on the area in which the dwelling is located.
Attention : conditions to be complied with during the breaks !
A vacancy of less than 12 months does not, therefore, necessarily involved the benefit of the tax advantage, but it is true only if everything is done to re-let the accommodation. Conditions are pretty strict, must be met :
the owner must demonstrate that it has undertaken the necessary steps to re-let (to insert ads, use a real estate agency, etc),
the conditions of the lease shall not be dissuasive,
the accommodation must be in a state to be rented,
the owner or a member of the tax household may not use the accommodation even for a very short time,
the housing must not be placed at the disposal of another occupant as precarious or free of charge, even for a very short period of time.
As you can see, a owner could easily get into trouble if he thought to do well in hosting someone in a vacant shelter acquired in the framework of the Pinel !
Exceptions to the questioning of the tax benefit
In certain exceptional conditions (and unfortunate), the tax benefit is not challenged even in the case of non-respect of the lease commitments. These exceptions relate to the taxpayer or couples subject to joint tax that the taxpayer or one member of the couple :
has a disability of second or third category under article L. 341-4 of the French social security code (invalid absolutely unable to exercise any occupation and invalid which are, moreover, obliged to have recourse to the assistance of a third person to perform the acts of ordinary life),
is terminated, that is to say that his contract of employment is broken at the initiative of the employer,dies.