Who is caught by IFI as a non-resident
Non-residents owe Impôt sur la Fortune Immobilière on French real estate only. The catch is deceptively simple: add up the fair market value of every French property you own, directly or indirectly, on 1 January of the tax year; if the total exceeds €1,300,000, you are inside the tax. The 1.3 million number is a cliff, not a taper; once you cross it, the tax brackets reach back to €800,000, which means the effective first euro of tax falls in the €800,000 to €1,300,000 band. Unmarried partners, married couples, and civil partners are assessed as a single household, not individually, so two non-residents with a €700,000 share each on a joint villa are over the threshold together while they would each be under on their own.
The bracket scale and threshold
The scale has six brackets. Up to €800,000, zero per cent. Between €800,000 and €1,300,000, 0.50 per cent. Between €1,300,000 and €2,570,000, 0.70 per cent. Between €2,570,000 and €5,000,000, 1.00 per cent. Between €5,000,000 and €10,000,000, 1.25 per cent. Above €10,000,000, 1.50 per cent. The scale is progressive, so a €3 million net real-estate wealth pays on each slice at its own rate, not a flat 1 per cent on the whole. A decote (reduction) softens the tax just above €1.3 million, fading out by €1.4 million. For non-residents with high-value Paris or Riviera holdings, the 0.70 per cent slice is by far the most consequential, because it runs over €1.2 million of taxable base.
View data as table
| Net real-estate wealth | Marginal rate |
|---|---|
| €0 to €800,000 | 0.00% |
| €800,000 to €1,300,000 | 0.50% |
| €1,300,000 to €2,570,000 | 0.70% |
| €2,570,000 to €5,000,000 | 1.00% |
| €5,000,000 to €10,000,000 | 1.25% |
| Above €10,000,000 | 1.50% |
The correspondence representative, in practice
For IFI, the French tax code asks for a représentant fiscal in the older, softer sense of the term: a physical address in France to which the administration can send notices, reminders, and assessments. This is a correspondence representative, not an accredited one; no guarantee of the tax is required, no joint-and-several liability is engaged, and the representative does not have to be a regulated firm. A relative who lives in France, a trusted notaire, a property-management company, even the concierge of your building can play the role, provided they accept in writing and can receive registered mail. Most of my clients use their French accountant, if they have one, or the accredited firm that handled their property purchase, as a convenient continuity of service rather than a strict legal requirement.
Valuation, debt, and the carve-outs
Valuation is at fair market value on 1 January, with a standard 30 per cent abatement on the property occupied as the main home (rarely relevant for non-residents, but worth knowing when you become resident or when your French pied-à-terre qualifies under specific cross-border rules). Properties rented long term attract modest valuation discounts, typically 10 to 20 per cent, reflecting the restricted fungibility. Debt is deductible against the related property, with the caveats that in-house loans from controlled entities are restricted and that a straight-line amortisation is imposed on interest-only loans beyond their tenth year. Professional real estate used by a genuine trading business is carved out entirely, which is why operational hotels and serviced residences behind a real business plan can sit outside the IFI perimeter.
Worked example
An Australian couple owns a Saint-Tropez villa valued at €3.8 million on 1 January 2026, with a €900,000 commercial mortgage from a French bank. They also hold 60 per cent of an SCI that owns a Paris apartment worth €1.2 million, with no debt. Direct holding: €3.8 million less €900,000, so €2.9 million taxable. Indirect holding: 60 per cent of €1.2 million, so €720,000 taxable. Total net real-estate wealth: €3.62 million, above the €1.3 million threshold. Bracket maths: €0 on the first €800,000, 0.50 per cent on €500,000 (€2,500), 0.70 per cent on €1.27 million (€8,890), 1.00 per cent on €1.05 million (€10,500), nothing else. Total IFI, €21,890. A correspondence representative with a French address signs off the return; the couple pays by bank transfer before the September deadline.
Pitfall to avoid
The pitfall is assuming that indirect holdings through a foreign company escape the French perimeter. They do not. The IFI transparency rule looks through every layer until it reaches the underlying real estate, and each layer's ratio is computed separately. A non-resident who owns shares in a Dutch BV that owns a Maltese holding that owns a French SCI still has French real estate on the IFI return, valued proportionally. The administration has invested heavily in automated cross-checking of foreign companies against the French land registry; the days when an offshore wrapper invisibly neutralised IFI exposure have been over since 2020.
Pro tip
If your real-estate wealth sits just above the €1.3 million threshold, the decote is worth modelling precisely. Between €1.3 million and €1.4 million, the administration grants a tapered reduction, computed as €17,500 minus 1.25 per cent of the net taxable wealth. At €1.35 million, the decote is €625, which is real money on a small base. Pushing the valuation slightly down through a careful, well-documented reliance on comparable sales (not desktop algorithms) can land you in the decote zone and shave more off the bill than the valuation work costs. Over €1.4 million, the decote is extinguished, so the exercise is pointless.
Key takeaways
- IFI catches non-residents when French real-estate net wealth exceeds €1.3 million on 1 January.
- The brackets run from 0 per cent to 1.5 per cent, progressive on each slice.
- A correspondence representative, not an accredited one, is enough for IFI.
- Indirect holdings through foreign companies are fully transparent for IFI.
- The decote between €1.3 million and €1.4 million rewards precise valuation work.
Frequently asked questions
Do I need an accredited firm for IFI?
No. IFI requires a représentant fiscal in the older, lighter sense of a correspondence representative: an address in France for the tax administration to write to. It is not the accredited representative required on property sales.
What counts as French real estate for IFI?
Directly held French property, shares in SCIs and other SPI-type entities to the extent of their French real estate, and indirect holdings through foreign companies, again to the extent of the underlying French real estate. Professional real estate used by a genuine operating business is carved out.
Is mortgage debt deductible?
Yes, but with tighter rules since . Interest-free family loans, in-house loans from related SCIs, and artificially structured debt are restricted. Commercial mortgages from third-party banks are deductible against the related property.
What is the filing deadline for non-residents?
IFI for non-residents is filed alongside the regular French income-tax return, typically by late May for paper filers resident outside Europe and mid-June for online filers. Late filing triggers the standard 10 per cent surcharge, rising to 40 per cent after formal reminder.