In 2023, France did something a property owner almost never sees: it abolished a tax. The taxe d''habitation, the annual occupancy charge that households had paid for generations, vanished for primary residences. Yet for the owner of a villa above Cannes or a pied-à-terre in the 6th arrondissement, the bill did not shrink — it grew. Second homes were deliberately carved out of the abolition, and in the years since, hundreds of communes have layered a surcharge of as much as 60% on top. France did not lighten the load on holiday homes. It concentrated it.
For anyone weighing a second home in France, that single reversal frames everything else. The French system treats a résidence secondaire as a deliberate signal of means, and it taxes accordingly — at the moment of purchase, through every year of ownership, and again on the day you sell. Understanding the three stages is the difference between a figure that ambushes you and one you planned for. It is also where co-ownership quietly rewrites the arithmetic, because nearly every number below is divided when a home is held in eighths rather than wholes. This guide walks the full sequence for 2026, and sits alongside our companion pieces on Spain and Italy for buyers comparing markets.
The Annual Bill: Taxe Foncière and the Second-Home Surcharge
Two annual taxes attach to a French home, and the distinction between them matters more than ever. The first, the taxe foncière, is the ownership tax — paid by whoever holds the property on 1 January, principal residence or not. It is calculated from the valeur locative cadastrale, the administration''s notional rental value of the property, multiplied by rates set locally, and it has risen steadily as communes lean on the one property tax that survived reform. The second is the taxe d''habitation, the occupancy tax — and this is where the holiday-home owner now stands alone.
Since 2023, the taxe d''habitation has been abolished entirely on primary residences. But it survives, intact, on second homes, where it is now formally the taxe d''habitation sur les résidences secondaires, or THRS. Roughly 3.7 million second homes in France remain liable. And in areas the state designates as zones tendues — places where year-round housing is scarce — communes may vote a surcharge on top of the base THRS ranging from 5% to 60%. This is not a fringe measure. The cities that have reached for the maximum read like a map of where foreign buyers most want to be: Paris, Nice and Cannes have all set the surcharge at 60%, Bordeaux at 40%, with more than 1,600 communes applying some level of majoration. The political logic is explicit — discourage homes that sit empty for much of the year — but the effect on a holiday-home budget is simply a larger annual number.
For a co-owner, both of these are property-level costs: they are billed once for the whole house, regardless of how many families hold it. In the co-ownership structure, they are paid by the company that owns the property and met from the annual running budget, which means each of eight owners effectively shoulders one-eighth of the taxe foncière and the THRS surcharge alike. The 60% surcharge that stings a sole proprietor in Cannes is, for a one-eighth owner, a 60% surcharge on one-eighth of the bill.
The Wealth Tax Most Co-Owners Never Trigger
France is one of the few European countries that still levies an annual tax on real-estate wealth: the impôt sur la fortune immobilière, or IFI. It applies to a household whose net taxable French and worldwide real estate exceeds €1.3 million on 1 January. Cross that line and the tax is computed on a sliding scale from 0.5% to 1.5%, with the calculation reaching back to begin at €800,000 once the threshold is passed. A principal residence enjoys a 30% reduction on its market value; a second home does not.
This is precisely the tax where buying a fraction rather than a whole changes your exposure. IFI aggregates the value of the real estate you own, so the relevant question is how much property a purchase actually adds to your base. A whole villa worth €1.2 million lands €1.2 million onto your IFI balance sheet. A one-eighth share of the same villa adds roughly €150,000 — and unless you already hold substantial French property, a stake of that size is unlikely to carry you over the €1.3 million line at all. Co-ownership does not exempt anyone from the IFI; it simply keeps the footprint each buyer adds small enough that, for most international families, the wealth tax never enters the conversation. That is a structural advantage the whole-home buyer cannot replicate without spending a fraction of the price — which is, in effect, what a co-owner does.
What You Pay When You Sell
A primary residence in France is sold free of capital-gains tax. A second home is not. The gain on a résidence secondaire is taxed at a headline 36.2% — 19% income tax plus 17.2% social contributions — but that top rate rarely applies to the whole gain, because France rewards patience. Taper relief reduces the taxable gain the longer you hold: the income-tax portion is fully extinguished after 22 years of ownership, and the social-contribution portion after 30 years. The 2026 finance law left this structure in place, despite proposals to shorten the timeline, so the long-standing 22-and-30-year regime still governs.
For a co-owner, the gain is measured on the resale of the share itself, and the same taper applies to the period you have held it. The practical point is one of scale and liquidity rather than rate: the sums in play are a fraction of a whole-home sale, and a share is a more tradeable, more modest asset to move than an entire villa. How a buyer funds the purchase in the first place — and the equity-release routes some use — is something we examine in detail in our piece on financing a co-ownership share.
The Cost of Buying In
France''s acquisition costs — the famous frais de notaire — are among the heaviest entry costs in Europe, and they rose again recently. The bulk of them is not the notaire''s fee at all but the droits de mutation à titre onéreux (DMTO), the transfer duties paid to the département and commune. The 2025 finance law allowed départements to lift the DMTO ceiling by 0.5 of a point, to around 5%, a power that more than 70 départements have already exercised and that runs until 2028. The result, on an existing (ancien) property in 2026, is total acquisition costs of roughly 7% to 8.5% of the price. New-build property is treated far more lightly — transfer duty falls to a token 0.715% and total costs sit nearer 2% to 3% — but most holiday homes change hands on the resale market, where the higher figure applies. A first-time-buyer exemption from the DMTO increase exists, but it is reserved for principal residences, so it offers nothing to the second-home purchaser.
Here, too, the fraction matters. Acquisition costs are charged on the value you actually buy, so a co-owner pays entry costs proportionate to a one-eighth stake rather than a whole house — turning a five- or six-figure frais-de-notaire shock into a manageable line item. It is the same principle that runs through every section of this guide: the rates France sets do not change, but the base they apply to does.
How Co-Ownership Changes the Maths
Step back and a pattern emerges. France''s property taxes are designed, deliberately, to press hardest on the lightly-used luxury second home: the surviving occupancy tax falls only on them, the surcharge targets the places they cluster, the wealth tax denies them the residence discount, and the capital-gains exemption is withheld until you have held for a generation. Each of those pressures is a function of value owned and value sold — and that is exactly what a one-eighth share reduces. The taxe foncière and the THRS are met collectively and divided by eight. The IFI base each buyer adds is small enough to stay below the line. The capital gain at exit is a fraction of a whole-home gain. The frais de notaire are charged on a fraction of the price.
A co-owner of a French home through this model holds their share alongside seven other vetted families, with roughly 44 to 45 days of use each year and the property-level taxes handled inside the annual management budget rather than landing on a doormat each autumn. None of this is tax avoidance; it is simply the natural consequence of owning a smaller, well-managed piece of a beautiful thing. For a fuller view of the legal scaffolding that makes it work, our guide to the wealth-tax treatment of shares across Spain, France and Italy is the natural next read.
The French dream of a place in Provence or on the Riviera has always come with a tax dimension that rewards the prepared and punishes the casual. What co-ownership offers is not a way around that system but a way to enter it on a different scale — to own the morning light on the terrace and the walk down to the market without owning, alone, the wealth-tax exposure and the 60% surcharge and the eight-percent entry cost of the whole. It turns the second home from a standing liability into a measured, shared pleasure: a second life, sized correctly.
To see the French homes available now as one-eighth shares, browse our France collection — from a villa with a heated pool above Valbonne to apartments in Paris — or read the full mechanics on our how it works page. When you are ready to talk through the numbers for a specific home, our team is a message away via the contact page. This article is general information, not tax advice; figures reflect the 2026 regime and individual circumstances vary, so confirm your own position with a qualified French notaire or tax adviser before you buy.
