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7 janvier 2016

Real Estate transfer tax – Rates applicable in Paris since 1st January 2016

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Given the rate increase passed by the Paris council on Nov. 23, 2015 (see our previous article) and the adoption by the French Parliament of an additional tax of 0.6% for offices, business premises and storage premises located in Ile de France (see our article dated Nov. 16, 2015), we felt it necessary to make a first recap of the applicable rates since 1st January 2016 to sales of buildings in Paris, pending comments from the tax authorities.

Property sold by a VAT taxable person acting as such:

- Building completed less than five years: 0.715% (including offices, commercial premises and storage premises)

- Building completed more than five years – offices, commercial premises, storage premises: 6.40% except commitment to sell within five years (1.315%) and commitment to build within four years (to 125 eur to be confirmed) – leaseback agreement with a bank (1.315%)

- Building completed more than five years – other cases: 5.80% except commitment to sell within five years (0.715%) and commitment to build within four years (125 eur) – leaseback agreement with a bank (0.715%)

Property sold by a non VAT taxable person:

- Offices, commercial premises, storage premises: 6.40% except commitment to sell within five years (1.315%) and commitment to build within four years (125 eur to be confirmed)

- Other cases: 5.80% except agreement to sell within five years (0.715%) and commitment to build within four years (125 eur)

We also took advantage of this summary to update the DMTO/RETT space.

 

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