Buyer’s Q&A
French IFI wealth tax and fractional ownership
French IFI applies above €1.3M of French real estate. A share is valued at its own fraction, which often keeps owners well below the threshold, while a comparable whole property would trigger IFI.
The short answer: French IFI (Impôt sur la Fortune Immobilière) is a wealth tax that applies above €1.3M of French real-estate value. For a non-resident buyer, a 1/8 fractional share of a €5M Côte d'Azur villa values at roughly €625k of French real estate — well below the IFI threshold. The same buyer owning the €5M villa outright would trigger IFI and face an annual charge in the tens of thousands. The fractional structure delivers this advantage automatically; if you own other French real estate, simply include it in the calculation.
Full guide: Second-home tax by country: Spain, France, Italy, Portugal, Austria and Germany compared
What IFI is
IFI is the French wealth tax on real estate. It replaced the broader French wealth tax (ISF) in 2018 and now applies only to real-estate assets. The threshold: net taxable French real-estate value above €1.3M. The rate is progressive, rising from 0.5% to 1.5% on the value above the threshold. For high-value French real estate, the annual charge can run into tens of thousands of euros.
How fractional ownership interacts with IFI
The deemed IFI value of a fractional share is calculated based on the underlying property value and the share size. For a 1/8 share of a €5M villa, the deemed value is roughly €625,000. For a buyer with no other French real estate, this sits well below the €1.3M threshold.
This is the structural reason fractional ownership has particular appeal at the top of the French luxury market. The €5M+ whole-property tier triggers IFI automatically; a share is valued at its own fraction, which often keeps owners well below the IFI threshold (€1.3m of net French property).
Worked example
| Whole €5M villa | 1/8 share of same villa | |
|---|---|---|
| Deemed French RE value | €5,000,000 | €625,000 |
| Above €1.3M threshold | €3,700,000 | €0 |
| IFI rate band (avg) | ~1.0% | n/a |
| Annual IFI | ~€37,000 | €0 |
| 10-year IFI total | ~€370,000 | €0 |
The IFI saving alone is comparable in size to the entire 10-year running cost of the fractional share. This is one of the cleanest structural advantages of the fractional model at the top of the French luxury market.
The aggregation rule that matters
The €1.3M IFI threshold applies to the buyer's total French real estate, not to each property separately. A buyer with one French primary residence at €1M plus a 1/8 fractional share at €625k aggregates to €1.625M — above the threshold. The fractional structure helps but doesn't eliminate IFI exposure for buyers with substantial other French real estate.
The implication: if you already own French real estate, add it to the share's value to see your position — and even then, a share adds a fraction of what a whole villa would.
French residents vs non-residents
For French residents, the IFI calculation includes worldwide real-estate values (with treaty adjustments). The fractional advantage still applies but is less dramatic because the rest of the resident's real-estate portfolio aggregates in.
For non-residents, only French real estate counts toward the IFI base. The fractional advantage is at its largest here — a share is valued at its own fraction, which often keeps non-resident owners with no other French real estate well below the threshold, even in the most expensive French villas.
Other IFI rules buyers should know
The IFI base allows deductions for mortgages secured on the French real estate, and for documented refurbishment costs. The fractional share's debt position is typically zero (buyers usually pay cash), so the gross value applies. Annual filing is required even for non-residents above the threshold; the company typically supports buyers with the basic reporting framework but specific tax filing is the buyer's responsibility.
What buyers should ask before purchase
Three questions for any French fractional purchase above €350k per 1/8 share. What is the company's standard owner-side IFI handling support? What is the deemed French-RE value of the proposed share (request this in writing)? What is the buyer's full French real-estate picture today (existing primary residence, other holiday-home interests) so a proper IFI aggregation can be calculated?
Where to find French fractional inventory
Co-Ownership Property's French selection includes fractional listings across the Côte d'Azur, French Alps and other French destinations.
Further reading
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