Taxation

General Case

Taxable Amount

Taxation does not apply to invested capital but only to received income (bond interest) and gains (potential capital gains).

Tax Calculation

If you are a French tax resident, your income is subject to the “flat tax” at a rate of 30% (12.8% for income tax + 17.2% for social security contributions). This tax is withheld at source; you receive your income net of taxes.

When filing your tax return, your gross income is pre-filled (box 2 TR of form n°2042). Each year, Harmony Homes sends you a Single Tax Form (IFU) that allows you to verify these amounts. (Note: alternatively, an IFU will be available in your personal space).

You have the option to choose the progressive income tax scale (by checking box 2 OP of form n°2042) instead of the flat rate of 12.8%. This option is beneficial if your marginal tax rate (TMI) is less than or equal to 11%.

Tip

• Your investment consists of purchasing bonds, which are financial securities; therefore, it is not included in the IFI (property wealth tax) calculation base.

• Harmony Homes investors are not liable for property tax, housing tax, and any other property-related taxes. Harmony Homes handles all administrative procedures and payment of these taxes.

Note

If your tax residence is abroad or your reference tax income is below €25,000, please consult the sections below.

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Special Case: Withholding Tax Exemption

If your reference tax income for year N-2 is less than €25,000 (or €50,000 for a married or civil partnership couple), you may be exempt from the 12.8% non-final income tax withholding.

The 17.2% withholding for social security contributions remains in place.

To validate your status, you will need to send us an affidavit regarding your tax situation by email (Note: a template letter will be provided).

Special Case: Tax Residence Abroad

If your tax residence is not established in France, your investment is exempt from social charges (CSG and CRDS), totaling 17.2%. However, a solidarity contribution rate of 7.5% will be applied to your investment. Consequently, a non-resident taxpayer in France is subject to a global tax rate of 12.8% + 7.5%, or 20.3% on realized capital gains. In accordance with existing tax agreements, this 12.8% tax may be deductible from the tax collected by your country of tax residence.

We invite you to make the necessary verifications with the competent authorities and your advisors.