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Besson law 2019

Show light - Real estate agency Biarritz - Luxury houses and apartments Basque Country

Applicable to new and old housing, the Besson 2019 law aims to boost rental investment. Operating principle, applications, tax reduction, ceilings, exit: an overview of the main points of this tax exemption system.

Principle of the Besson Law

Adopted in 1990, the Besson Law on the Implementation of the Right to Housing replaced the Perissol Law. One of the main innovations is the introduction of specific measures to encourage rental investment by allowing buyers of new or old property to benefit from tax advantages, provided that the amount of rent and the tenant's resources are equal to or lower than the ceilings set by the scheme.

The Besson law in the old

Concerning the old one, the Besson law gives the buyer of the property the right to a 26% reduction on his land income.

The Besson law in the new

With regard to new housing, the Besson law applies only to rental property purchased between 1 January 1999 and 4 April 2003. The amount of the reduction is variable and depends on the cost price of the property. To benefit from the tax advantages offered by the Besson Act in new housing, other criteria must be respected such as the rental period of the property (9, 12, 15 years), the resources of the tenant and the amount of the rent fixed. 

The Besson law and tax exemption

During the first 5 years of rental, the buyer benefits from an 8% reduction in the purchase price of his property on land income. The tax exemption is reduced to 2.5% per year for the following 4 years. After 9 years, depreciation can be renewed at a rate of 2.5% per year for an additional 6 years. In total, over 15 years, the reduction reaches 65% of the value of housing investment on land incomes.

The limits for benefiting from the Besson Act

There are two types of limits: the rent, which varies according to the geographical area where the property is located (A, B1, B2, C), and the resources of the tenants. The ceilings for new and old properties are different. For new housing, the rent ceiling ranges from €10.60 per m² (zone C) to €16.56 per m² (zone A). In the old one, it is between €8.75 per m² and €18.48 per m². The income ceiling for tenants is the same for new and old buildings: from €31,656 for people living alone in zone C, to €134,174 for families living in zone A with 4 children.

How to get out of a Besson law without losing the tax advantage?

If you own a new home, you must wait at least 9 years before reselling your property. If you sell before this deadline, the discounts you have received will be claimed from you.

For more information on legislation or any other advice on real estate in Biarritz and on the Basque Coast, do not hesitate to contact our agents.