How to properly declare your rental income?

---

Depending on whether your property is rented out unfurnished or furnished, the rules change: tax regime, forms, deductible expenses, penalties… So, how do you properly declare your rental income? This article helps you choose the right regime, fill out your tax return, and avoid common mistakes.

Key takeaways

• Identify the correct tax regime based on the type of rental and the amount of rent collected.
• Use the appropriate forms (2042, 2044, 2042 C PRO, 2031) depending on your situation.
• Keep all proof of rent received and deductible expenses.
• Check your tax options every year and update your information on impots.gouv.fr.
• Get professional assistance to secure your declaration and avoid errors.

Before proceeding, if you own a property in the Nice area, please note that our Winter Immobilier agency supports you in your endeavors with rigor and expertise.

What tax regimes apply to rental income?

The tax regime for your rental income depends on the type of rental: unfurnished (property income/revenus fonciers) or furnished (BIC). Each category follows distinct reporting rules, with either a simplified or actual regime depending on the amounts received and expenses incurred.

Property income: unfurnished rental

Rents received from an unfurnished rental are taxed under the category of property income (revenus fonciers), according to two possible regimes:

• The micro-foncier regime: this applies automatically if your annual rent (excluding charges) is less than €15,000. It offers a flat-rate deduction of 30% without the possibility of deducting your actual expenses.
• The real regime (régime réel): this becomes mandatory above €15,000 or is available as an option. It allows you to deduct all your actual expenses (works, loan interest, insurance, co-ownership fees) but requires filing form 2044 and a three-year commitment.

BIC income: furnished rental

Rents from a furnished rental are taxed under the BIC category (Industrial and Commercial Profits), with two regimes to choose from depending on the amount of receipts:

• The micro-BIC regime: this applies if your receipts do not exceed €77,700 per year. It offers a 50% allowance and is easily declared via form 2042 C PRO.
• The simplified / normal real regime: this becomes mandatory above the threshold or can be chosen voluntarily. It allows you to deduct expenses and depreciate the property, but requires full accounting and a declaration via form 2031.

How to correctly fill out your rental income tax return?

Whether you rent out an unfurnished or furnished property, your rental income declaration must be done with rigor, to avoid damaging errors or omissions.

Here are the steps to follow to properly declare rental income:

1. Identify the type of rental: unfurnished rentals fall under property income (revenus fonciers), furnished rentals under BIC (Industrial and Commercial Profits).
2. Choose or confirm your tax regime: micro (simplified) or real, depending on the amount of rent received and your deductible expenses.
3. Gather your supporting documents: leases, rent calls, bank statements, invoices for works or management, depreciation schedule (for the real BIC regime).
4. Fill out the appropriate form: 2042 (and 2044 if using the real regime) for property income, and 2042 C PRO (and 2031 if using the real regime) for BIC.
5. Check the declared amounts and the checked boxes before sending, especially in the event of a change of regime or property.

What errors should be avoided when declaring collected rent?

The declaration of rental income may seem simple, but certain frequent errors can lead to tax reassessments or a loss of optimization.

Here are the main pitfalls to avoid:

• Confusing furnished and unfurnished rentals: these two types of rentals fall under distinct tax regimes (BIC vs. property income).
• Choosing an unsuitable regime: opting for the micro regime when your actual expenses are higher than the flat-rate allowance can penalize you fiscally.
• Forgetting to declare a property or a change of tenant: every rented property must be declared, including vacant periods.
• Not keeping your supporting documents: in the event of an audit, you must be able to prove your expenses and rent received.
• Incorrectly filling out the forms: reversed boxes, partially entered income, forgetting form 2044 or 2031 depending on the real regime.

What are the penalties for incorrect declaration?

An incorrect or incomplete declaration of your rental income can lead to significant financial consequences.

In the event of an oversight or voluntary omission, the tax administration may proceed with a reassessment, accompanied by penalties that can go up to 40% of the evaded amount for deliberate non-compliance, or even 80% in the event of fraudulent maneuvers.

Late payment interest on the declaration of rental income is also applied, at the legal rate of 0.20% per month. Even in the absence of intent to defraud, a form error, a forgotten expense, or confusion between the micro and real regimes can be enough to trigger an audit.

It is therefore essential to verify every piece of declared data, and to keep all supporting documents (leases, receipts, invoices, bank statements).

Winter Immobilier's added value: we offer landlords in Nice professional support to avoid these inconveniences while securing your taxation.

As a landlord, are you certain you are declaring your rental income optimally, without risking errors or tax losses?

To assist you in this step, call on the expertise of the Winter Immobilier agency. Present in Nice for over 60 years, our rental management team in Nice advises you on how to secure your rental taxation and serenely enhance the value of your assets.

FAQ

What costs can be deducted from rental income?

Under the real regime, you can deduct the following expenses: maintenance works, loan interest, landlord insurance, rental management fees, property tax (excluding household waste tax), provisions for co-ownership charges, and relocation costs. These deductions are not possible under the micro regime, where a flat-rate allowance applies.

What documents are necessary to declare rental income?

You must gather rental leases, statements of collected rent, receipts, invoices for works or insurance, calls for co-ownership charges, loan interest, and any proof of expenses. These documents are essential to prove your deductible expenses in the event of an audit, particularly if you opt for the real regime.

How to calculate taxable income from renting?

Under the micro regime, simply declare the rent received excluding charges, and the administration applies a flat-rate allowance (30% for property income, 50% for BIC). Under the real regime, you subtract deductible expenses from your rental receipts. The taxable result corresponds to the net property or BIC profit to be included in your global income.

What are the tax obligations related to renting out a property?

You must declare your income every year, but also report any change of tenant, rent, or vacancy via your space on impots.gouv.fr. Rents are subject to income tax and social contributions. For furnished rentals, registration with the registry (SIRET number) is also mandatory.

How to choose between the different tax regimes?

The choice depends on the amount of your rent and your expenses. If your expenses are low, the micro regime (flat-rate allowance) is often advantageous. On the other hand, if your actual expenses exceed the allowance, the real regime allows you to reduce your taxable base. A simulation is often useful to decide.