FRANCE OPENS TO OFFSHORE INVESTORS
July 08, 2009
Investors based in Jersey, Guernsey and the Isle of Man will no longer have to pay an annual tax of 3% on the gross value of French property.
The change is expected to occur by the end of 2009 and follows the Tax Information Exchange Agreement (TIEA) signed in March by Jersey’s chief minister, Terry Le Sueur, and the French finance minister, Christine Lagarde.
The agreement establishes a formal system of tax information exchange and changes the status of island companies and trusts with over 50% of assets in French property so they are exempt from the tax.
“The removal of the French annual 3% tax… will be a huge boost for the French property market, specifically investment property,” said solicitor and chartered tax adviser David Anderson.
“However, it could have a negative effect on some parts of the UK property market. Soon, a pool of capital in the Channel Islands and Man will, for the first time, be able to flow, uninhibited, into France, with quality French property in good locations set to do particularly well.”
Source - OPP