The 2026 LMNP/LMP Reform: What Foreign Investors in French Property Need to Know

Updated 2026-06-20 · The French Property Playbook

Last reviewed: 19 June 2026; updated 2 July 2026 (LF 2026 art. 53 non-resident LMP test; €83,600 threshold enacted; bailleur privé enacted; LFSS split statute-confirmed — see the "Update — July 2026" section). This is general education on French law and tax in force at July 2026 — not personal tax, legal, or investment advice. French rules in this area changed materially across 2025–2026 and several points are still being clarified; verify your own situation with a qualified French expert-comptable or avocat fiscaliste before you act. Items not yet corroborated against a consolidated official source are flagged [NEEDS CONFIRMATION].

If you own — or are about to buy — a furnished rental in France under the LMNP (Loueur en Meublé Non Professionnel) or LMP (Loueur en Meublé Professionnel) status, the numbers you were sold on may no longer be true.

Two structural changes hit furnished letting between February 2025 and January 2026, plus a separate cut to the regime for short-term tourist lets that arrived a little earlier. None of them "banned" LMNP. But together they change the after-tax maths on both the holding phase and — crucially — the exit. For a non-resident investor, the exit is where most of the surprise now lives.

This is the explainer we wish existed when these rules landed: what actually changed, what it means for a foreign buyer specifically, and what to do about it. Every figure below is dated and tied to a primary source.

The 60-second version

1. On resale from 15 February 2025, the depreciation (amortissement) you deducted while you owned a furnished rental is added back into your taxable capital gain. This raises the gain — and the tax — on exit. It captures depreciation taken before 2025 too. (LF 2025 art. 84; CGI 150 VB III.)
2. From 2025 furnished income (declared in 2026), the social-charge rate on furnished-letting profit for LMNP (loueurs non professionnels) rose from 17.2% to 18.6% (LMP profit sits under SSI social cotisations ~35% instead, not these prélèvements). Unfurnished rent and property capital gains stayed at 17.2%. (LFSS 2026.)
3. Short-term tourist lets (meublés de tourisme) had their micro-BIC flat deduction slashed by loi Le Meur — to 30% (€15,000 ceiling) for unclassified properties and 50% (€77,700) for classified ones, starting with 2025 income. (Loi n° 2024-1039.)
4. LMNP depreciation under the régime réel survived. The much-feared abolition of amortissement did not happen in the 2026 Finance Act (a proposed 2%/yr cap was dropped from the final text). A new unified landlord status — the statut du bailleur privé (dispositif Jeanbrun) — was enacted at LF 2026 art. 47: an amortisation deduction against revenus fonciers for unfurnished lettings, with its own caps and a 9-year commitment (details below). (Loi de finances 2026 — LOI n° 2026-103, promulgated 19 Feb 2026.)

If you are a non-resident, add a fifth: non-EU/EEA/Swiss non-residents also moved from 17.2% to 18.6% social charges on French rental income and gains from 1 January 2026. EU/EEA/Swiss-affiliated owners keep their reduced 7.5% rate.

The rest of this article unpacks each of these, in the order they bite.

First, a definition: what LMNP and LMP actually are

France taxes furnished rental income as business income (bénéfices industriels et commerciaux, BIC), not as ordinary rental income (revenus fonciers). Within furnished letting there are two statuses:

• LMNP — Loueur en Meublé Non Professionnel — the default for most private investors.
• LMP — Loueur en Meublé Professionnel — applies only when both conditions are met: your household's furnished receipts exceed €23,000 per year, and those receipts exceed your household's other professional income. Otherwise you are LMNP. The old requirement to register with the RCS was abolished in 2020. (CGI art. 155, IV; BOFiP BOI-BIC-CHAMP-40-10.)

The status is assessed at household level — important for non-residents whose worldwide income picture differs from a French resident's.

Why investors love(d) furnished letting under the régime réel: you can deduct actual charges plus depreciation of the building (by components, excluding land, typically ~2–3%/year) and furniture (~10–20%/year). Depreciation often wiped out taxable rental profit for years. The catch always was — and the rules below sharpen it — what happens to that depreciation when you sell. (CGI art. 39 C; BOFiP.)

Update — July 2026: the non-resident LMP test changed, and URSSAF is checking

Three developments since this article was first published — all favouring investors who get the status question right:

1. The LMP test was recast for non-residents (LF 2026 art. 53, CGI 155 IV 3°). The "other professional income" leg now counts foreign professional income taxed under an equivalent income tax. Practical effect: many non-resident owners flip from LMP to LMNP from 2026 income. That matters because LMNP means 18.6% prélèvements sociaux (or 7.5% if EU/EEA/Swiss-affiliated) instead of SSI cotisations (~35%), a 10-year ring-fenced deficit carry, and the private capital-gains regime with the amortisation recapture. (CMS Francis Lefebvre, 7 May 2026; DINR FAQ, impots.gouv.fr, 13 Apr 2026.)
2. Enforcement is live. URSSAF ran a questionnaire campaign from January to April 2026 targeting hosts with more than €23,000 of short-term rental receipts — the LMNP/LMP boundary is being actively policed, not left to self-assessment.
3. The recapture reach widened. LF 2026 extended the CGI 150 VB III amortisation recapture to the new bailleur-privé regime's amortissements (art. 47) — the "depreciate now, add back at sale" logic now spans both the furnished and the new unfurnished lanes.

Change 1 — The big one: depreciation is now recaptured into your capital gain (from 15 Feb 2025)

This is the change that matters most, and the one most likely to blindside an investor who modelled their returns on pre-2025 advice.

What changed. For sales completed on or after 15 February 2025, the amortissement you deducted during ownership is subtracted from the acquisition price when computing your capital gain. A lower deemed cost base means a larger taxable gain. (Loi de finances 2025 art. 84; LOI n° 2025-127 du 14 février 2025; CGI 150 VB III; LEGIARTI000053544785.) LF 2026 has since extended the same recapture to bailleur-privé amortissements (art. 47 regime).

In plain terms: the depreciation that sheltered your rental income along the way is clawed back into your capital gain at exit. The benefit didn't disappear — it was deferred to the sale.

Three precise points the headlines get wrong:

• It captures pre-2025 depreciation too. Depreciation deducted in years before 2025 is still recaptured on a post-15-Feb-2025 sale. This was confirmed in Réponse Mette (QE n° 10097, JOAN 24/03/2026). If you bought in, say, 2018 and depreciated for years, that history follows you to the exit.
• Only depreciation actually deducted ("admis en déduction") is recaptured. Depreciation that was deferred and never actually deducted — amortissements différés — is not added back.
• It is NOT a loi Le Meur measure. This frequently gets conflated with the tourist-let rules below. It is a separate Finance Act provision.

What did NOT change: the rate framework. The gain stays inside France's standard private capital-gains regime: 19% income tax + 17.2% social charges = 36.2% before allowances. Critically, the recaptured gain is not taxed at the new 18.6% furnished-BIC social rate — property capital gains kept 17.2% (more on that below). The holding-period taper also survives: full income-tax exemption at 22 years, full social-charge exemption at 30 years, plus the surtax on large gains. (CGI 150 VC; CGI 1609 nonies G.)

Who is excluded. Certain managed residences escape the recapture entirely: student / under-30-in-training / over-65 residences (CCH L.631-12/L.631-13), EHPAD and senior/disabled service establishments (CASF L.312-1, 6°/7°), and long-term-care establishments (CSP L.6143-5). And because micro-BIC involves no depreciation at all, micro-BIC investors are unaffected by this recapture.

Why a foreign investor should care most. If you bought a furnished apartment expecting a low-tax exit after a decade — the classic LMNP pitch — your exit tax is now meaningfully higher than the old advice implied, especially if you sold before the 22/30-year tapers do their work. This is precisely the kind of decision our The Investor's Math module (M2) and the Exit & Decision Dossier model (M14) are built to surface before you buy, not after you sell.

Change 2 — Social charges on furnished profit rose to 18.6% (from 2025 income)

France's prélèvements sociaux on capital income were historically 17.2% (CSG 9.2% + CRDS 0.5% + prélèvement de solidarité 7.5%). The 2026 Social Security Finance Act (LFSS 2026, LOI n° 2025-1403 du 30 décembre 2025) raised the CSG component and split the result by income type:

(LFSS 2026; CSS art. L.136-8 as consolidated (LEGIARTI000054336623): CSG 10.6% on patrimoine/placement, with IV keeping 9.2% by derogation for revenus fonciers and plus-values immobilières. Confirmed by the DINR FAQ, impots.gouv.fr, 13 Apr 2026. Note: LMP furnished profit is not in this table at all — it sits under SSI social cotisations (~35%), not the prélèvements sociaux.)

The trap to avoid: do not apply 18.6% to everything. It hits LMNP furnished rental profit. It does not hit unfurnished rent, and it does not hit your property capital gain — those both stayed at 17.2%. Getting this fork wrong is one of the most common errors we see, and it is exactly why we teach the four social-charge rates explicitly rather than as a single headline number.

Update 2 July 2026 — the split is now statute-confirmed (CSS L.136-8 consolidated + DINR FAQ). The one residual open point: the BOFiP gloss on the non-EU non-resident scope is still pending.

Change 3 — loi Le Meur cut the micro-BIC for short-term tourist lets

If you let on a short-term / seasonal basis (Airbnb-style meublés de tourisme), a separate and earlier reform already changed your numbers. Loi Le Meur (n° 2024-1039 du 19 novembre 2024) cut the micro-BIC flat deduction for tourist lets, starting with 2025 income (declared in 2026):

(CGI art. 50-0; loi 2024-1039; JORFTEXT000050612711.)

A few things to keep straight:

• The 50% classé rate is now uniform nationwide — the zone tendue distinction concerns day-caps and registration, not the deduction rate.
• Above these ceilings (or by election), you move to the régime réel, where you deduct actual charges and depreciation — which is often the better answer once the micro deductions shrink, but it is more administration.
• Loi Le Meur also brought registration and day-cap powers: a mandatory 13-digit registration number on listings via a national téléservice (deadline 20 May 2026), a principal-residence short-let cap of 120 days/year (reducible to 90 by commune deliberation since 1 Jan 2025), phased DPE obligations, and the power for a syndic to vote to ban or regulate tourist lets in a building.

Short-term letting can still out-earn long-term — but the after-tax gap narrowed, and the compliance load rose. We model this end-to-end in the STR Underwriting & Compliance Model (M13) and the Short-Term Rentals (Loi Le Meur) module.

Change 4 — what did NOT happen: LMNP depreciation survived, and a new landlord status appeared

Heading into the 2026 budget, many investors feared the régime réel depreciation deduction itself would be abolished. It was not. The Loi de finances 2026 (promulgated 19 February 2026) retained LMNP amortissement.

It also created a new unified "statut du bailleur privé" (dispositif Jeanbrun), intended to rationalise the patchwork of landlord incentives that ended with Pinel (Pinel itself expired 31 December 2024).

Update 2 July 2026 — the mechanics are now enacted (LF 2026 art. 47; CGI 31 I-1° i neuf / j ancien): an amortisation deduction against revenus fonciers (régime réel, on option) for unfurnished lettings — neuf 3.5/4.5/5.5% and ancien 3.0/3.5/4.0% (intermédiaire/social/très social), on a base of 80% of the price (land excluded), capped at €8k/€10k/€12k per foyer per year; collective buildings only; let bare as the tenant's principal residence with a 9-year commitment; ancien requires works ≥30% of cost reaching class A/B; and the amortisation is recaptured at resale via CGI 150 VB III, like LMNP's. Applies to acquisitions/permis 21 Feb 2026 – 31 Dec 2028. A pending bill would soften the ancien works test to 20% — not law. It is an unfurnished-lane alternative, not a change to LMNP itself. (ANIL; AJ LF 2026.)

A note for non-residents: the 18.6% / 17.2% / 7.5% social-charge fork

Foreign owners face an extra layer on top of everything above — the social-charge rate that applies to you depends on where you are socially insured:

• EU / EEA / Swiss-affiliated non-residents (and those not in the French system but covered by an EU/EEA/Swiss scheme) pay a reduced 7.5% (prélèvement de solidarité only) on French rental income and gains — the de Ruyter benefit. UK owners keep this 7.5% benefit despite Brexit. It must be claimed with affiliation proof.
• Non-EU/EEA/Swiss non-residents moved from 17.2% to 18.6% (CSG 9.2% → 10.6%) on French rental income and real-estate capital gains from 1 January 2026 — a headline of up to 37.6% before allowances. Sources describe this as intentional targeting of non-EU non-residents (raising the rate on EU residents would risk a CJEU/de Ruyter challenge). (LFSS 2026, LOI n° 2025-1403; sources: lesfrancais.press; Hagnère Patrimoine.)

[NEEDS CONFIRMATION] — the precise scope of the non-EU/EEA/Swiss 18.6% (rental income vs. capital gains) awaits the BOFiP gloss, still pending as of 2 July 2026; one source reads the residents' L.136-6 protection more broadly. (The 18.6%/17.2% split itself is statute-confirmed — CSS L.136-8 consolidated; DINR FAQ 13 Apr 2026.)

Layered on top are the non-resident income-tax minimum rate (20% up to €29,579, 30% above, for 2025 income, unless you can prove a lower taux moyen), the représentant fiscal rules on some sales — recently overhauled by Décret n° 2025-502 du 6 juin 2025 — and your home-country reporting (US FBAR/Form 8938; UK Self Assessment with foreign tax credit). We separate these threads in Money & Tax Foundations (M6) and Own/Comply/Exit (M14), and route the structuring decision through the Tax Structuring (LMNP/SCI) module (M8) and The Vehicle & Regime Comparator tool.

Don't forget the CFE

A point that surprises new furnished landlords: furnished letting is treated as a commercial activity, so most furnished landlords owe the CFE (cotisation foncière des entreprises) from year 2 (year 1 is exempt). There is an automatic exemption if your gross furnished receipts are ≤ €5,000/year (assessed on an N-2 basis). It is deductible under the régime réel. (CGI art. 1647 D; impots.gouv.fr.) It is a small line, but it belongs in your operating-cost model — and it is built into our Deal Underwrite & Due-Diligence Kit.

One threshold to watch: the 2026 micro-BIC ceiling

There is also a moving threshold worth flagging. The long-term-furnished and classé-tourism micro-BIC threshold is €77,700 for 2025 income, rising to €83,600 for 2026 income (declared 2027) — now enacted by the Loi de finances 2026 (LOI n° 2026-103 du 19 février 2026), under the triennial revaluation covering 2026–2028 (the ventes/hébergement ceiling rises to €203,100). The €15,000 non-classé floor and the 30%/50% rates are not indexed. (service-public actualité A18813.)

Use the right year's figure: €77,700 still governs 2025 income declared in 2026; €83,600 applies from 2026 income declared in 2027.

What to do now

This is education, not advice — but here is the disciplined way to respond to these changes:

1. Re-run your exit maths. If your LMNP case rested on a low-tax sale, model the depreciation recapture into the gain (M2, M14). The holding-phase shelter is now a deferred exit liability.
2. Pin your social-charge rate. LMNP furnished BIC = 18.6% (LMP → SSI cotisations instead). Unfurnished and capital gains = 17.2%. Non-resident? Determine whether you qualify for the 7.5% EU/EEA/Swiss reduced rate, or fall into the non-EU 18.6% — and re-test your LMNP/LMP status under the new art. 53 rule.
3. Re-check the micro vs. réel decision. With loi Le Meur shrinking the tourist micro-BIC, the régime réel (with depreciation) is more often the better answer — but it carries the recapture liability and more admin. Run both.
4. Mind the compliance dates. 13-digit registration via national téléservice by 20 May 2026 for tourist lets; CFE from year 2.
5. Verify before you sign. Several of the figures above carry [NEEDS CONFIRMATION] flags and several rates reset on a schedule. Re-confirm against the consolidated CGI / BOFiP / impots.gouv.fr for your specific income year before you commit.

The single biggest mistake we see is trusting a pre-2025 English-language guide. Most predate every change on this page — loi Le Meur, LF 2025, LF 2026, and LFSS 2026. Confident, out-of-date advice is the expensive kind.

Want the numbers run for your own situation?

We built The French Property Playbook precisely because the rules above keep moving and almost no English-language resource keeps up.

• Start free with the Buying-Costs / Notaire-Fees Calculator — the same engine we use to model a French purchase, including the geographic DMTO reality. (Free lead magnet.)
• Go deeper with the flagship "Build a French Portfolio" — all 14 calculators (including The Vehicle & Regime Comparator for the LMNP vs. LMP vs. SCI decision, and the Exit & Decision Dossier that models the depreciation recapture into your exit) plus the LMNP/SCI tax-structuring modules and the full kept-current 2026 facts layer. (Investor flagship, €1,500 one-time [VALIDATE]; includes Year 1 of the "French Property Current" membership.)
• Stay current with the "French Property Current" membership — annual law/tax/market refreshes and reform alerts, so the numbers stay right after the next budget. (€300/yr [VALIDATE].)

The 2026 reforms are exactly why a kept-current, calculator-driven system beats a static guide: the law changed three times in eighteen months, and it will change again.

Sources & primary law: Loi de finances 2025 art. 84 (LOI n° 2025-127 du 14 février 2025), CGI 150 VB III (LEGIARTI000053544785); Conseil constitutionnel 2025-874 DC (13 Feb 2025); Réponse Mette QE n° 10097 (JOAN 24/03/2026); LFSS 2026 (LOI n° 2025-1403 du 30 décembre 2025), CSS L.136-8 consolidated (LEGIARTI000054336623); loi Le Meur (LOI n° 2024-1039 du 19 novembre 2024, JORFTEXT000050612711), CGI 50-0; Loi de finances 2026 (LOI n° 2026-103 du 19 février 2026), art. 47 (CGI 31 I-1° i/j) & art. 53 (CGI 155 IV 3°), CGI 156; CGI 150 VC, 1609 nonies G, 155 IV, 39 C, 1647 D, 244 bis A; Décret n° 2025-502 du 6 juin 2025. Secondary corroboration: BOFiP; impots.gouv.fr (incl. DINR FAQ 13 Apr 2026); service-public.fr (A18813); CMS Francis Lefebvre (7 May 2026); ANIL; Banque Transatlantique; DLA Piper; Hagnère Patrimoine; Médicis Immobilier Neuf; PAP.fr; lesfrancais.press. Figures as of 19 June 2026, updated 2 July 2026 — re-verify for your income year before acting.

This article is general information about French law and taxation, not personalised tax, legal, or investment advice, and does not create a client relationship. French rules in this area are changing rapidly and some points remain unconfirmed against consolidated official sources. Consult a qualified French expert-comptable or avocat fiscaliste about your own circumstances before making any decision.