Micro-foncier or régime réel: which regime should you choose?
The rents of an unfurnished let are taxed as property income (revenus fonciers). Two regimes coexist: micro-foncier, a flat-rate scheme (30 % allowance), and régime réel, which deducts your actual expenses and can create a property deficit. This simulator compares the two and tells you which is more advantageous. No sign-up, no data stored.
Micro-foncier or régime réel: how to choose
Micro-foncier is available as long as your annual gross property income does not exceed €15,000. It applies a flat 30 % allowance meant to cover all your expenses: you are taxed on 70 % of your rents, with no expense to justify. It is the simplest regime, applied by default, and the most advantageous as long as your real expenses represent less than 30 % of your rents.
The régime réel applies by law above €15,000 of gross rents, or by election (a 3-year commitment). It lets you deduct the expenses actually borne: property tax, landlord insurance (PNO), management fees, loan interest, insurance premiums and maintenance, repair or improvement works. As soon as those expenses exceed 30 % of the rents, the réel becomes more attractive than micro-foncier.
When your deductible expenses exceed your rents, the régime réel generates a property deficit (déficit foncier). The share of the deficit excluding loan interest is offset against your overall income up to €10,700 per year, directly reducing your income tax; the excess and the interest-related share are carried over onto your rental income for the following ten years. In return for this offset, you must keep the home let until 31 December of the third year that follows.
In both cases, taxable property income also bears social charges of 17.2 % (CSG, CRDS…). Under micro-foncier, report the gross amount of your rents in box 4BE of form 2042: the 30 % allowance is applied automatically. Under régime réel, detail receipts and expenses on form 2044, whose result is carried over to the 2042.
Frequently asked questions
Micro-foncier or régime réel: which is more advantageous?
Micro-foncier applies a flat 30 % allowance: it is advantageous if your real expenses represent less than 30 % of your rents. As soon as your expenses (works, loan interest, property tax, insurance) exceed that threshold, the régime réel becomes more attractive and can, where relevant, create a property deficit. Micro-foncier is reserved for gross property income of €15,000 or less per year.
What is a property deficit and how do you use it?
A property deficit (déficit foncier) arises when your deductible expenses exceed your rents under the régime réel. The share excluding loan interest is offset against your overall income up to €10,700 per year, reducing your tax; the surplus and the interest-related share are carried over onto your rental income for the following ten years. In return, you must keep the property let until 31 December of the third year after the offset.
Can you switch regimes every year?
Micro-foncier is the default regime below €15,000 of gross rents. Electing the régime réel commits you for three years: after that period the option renews tacitly year on year, but you can return to micro-foncier if you stay under the ceiling. Above €15,000, the régime réel is mandatory.
Does this simulator cover furnished letting?
No. The rents of a furnished let are industrial and commercial profits (BIC), declared under the LMNP or LMP status (micro-BIC or régime réel), not property income. Micro-foncier and form 2044 only concern unfurnished (nue) letting.
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