The Impôt sur la Fortune Immobilière (IFI) is the French wealth tax that applies to net real estate assets above a fixed threshold. It replaced the former ISF in 2018 and is governed by Articles 964 to 983 of the French General Tax Code (CGI). This overview summarises the framework as it stands in 2026.
Who is subject to the IFI
Two categories of taxpayers fall within the scope of the IFI :
- French tax residents, on the net value of their real estate assets held worldwide.
- Non-residents, on the net value of real estate situated in France only (including shares in companies holding French real estate, subject to specific rules).
The applicable threshold is €1,300,000 of net real estate assets, appreciated as of 1 January of the year of taxation. Below this threshold, no IFI is due. Above the threshold, the progressive scale below is applied from €800,000 upwards.
International tax treaties may modify these rules
For non-residents, bilateral tax treaties concluded between France and the taxpayer's country of residence may modify the application of the IFI or provide relief. These treaty provisions vary substantially and must be checked individually with a qualified tax counsel.
The 2026 progressive scale (Article 977 CGI)
Once a taxpayer is above the €1.3M threshold, the tax is built using the following progressive scale. Each band is taxed at its marginal rate.
| Band of net taxable real estate | Marginal rate |
|---|---|
| 0 to €800,000 | 0 % |
| €800,000 to €1,300,000 | 0.50 % |
| €1,300,000 to €2,570,000 | 0.70 % |
| €2,570,000 to €5,000,000 | 1.00 % |
| €5,000,000 to €10,000,000 | 1.25 % |
| Above €10,000,000 | 1.50 % |
The progressive scale, the €1.3M threshold, and the deduction rules are subject to legislative change at each loi de finances. The figures shown above reflect the situation as of June 2026.
An illustrative example
The following example is purely illustrative. A French tax resident with €3,000,000 of net real estate assets would, under the 2026 scale, owe IFI calculated as :
- 0 to €800k at 0 % = €0
- €800k to €1.3M at 0.50 % = €2,500
- €1.3M to €2.57M at 0.70 % = €8,890
- €2.57M to €3M at 1.00 % = €4,300
- Approximate IFI : €15,690 per year
Individual situations vary based on the composition of the taxable real estate, the deductibility of debts, the application of any specific exemptions (notably professional real estate), and the international dimension of the file.
The role of debt and the deductibility framework
The IFI is calculated on the net value of real estate assets, defined as the gross taxable value of the real estate less the deductible debts associated with these assets (Article 974 CGI).
The principle is that debts contracted for the acquisition, improvement or conservation of taxable real estate are deductible from the gross value. In practice, this means that holding real estate financed by a mortgage substantially reduces the net taxable base, and may bring it below the €1.3M threshold entirely.
Important nuances apply to the deductibility of debt, including but not limited to :
- Loans contracted with a related person (family member, controlled company) require justification of normal economic conditions.
- For in fine loans, the deductible amount may be limited to an amortizing-equivalent schedule.
- For high-value patrimonies, when the gross taxable real estate exceeds €5,000,000 AND the deductible debts exceed 60 % of this gross value, the excess deduction is subject to a 50 % limitation on the part above the 60 % threshold (Article 974 III CGI).
- The deductibility framework is technical and the precise calculation must be reviewed individually with a tax counsel.
The application of these rules is sensitive to the structure of the loan, the relationship between the lender and the borrower, and the composition of the patrimony. The principles outlined here are informational ; their application to a specific situation must be validated by a qualified professional.
Other important points
- Professional real estate used for the taxpayer’s main professional activity is generally exempt (Article 975 CGI), subject to specific conditions.
- Capped tax rule (plafonnement, Article 979 CGI) limits the total of IFI plus income taxes to 75 % of total income. This can substantially reduce the IFI owed in years of low income.
- Specific exemption for forests and certain agricultural assets, under conditions.
- The IFI is an annual tax, not a transactional one. Structuring decisions taken at the moment of acquisition are the cheapest moment to act.
How Omage fits in
As a regulated Conseiller en Investissements Financiers (CIF) and mortgage broker, we routinely encounter the IFI dimension when discussing acquisitions with international and high-net-worth buyers in France. Our role is to surface the question early, to structure the financing in a way that is consistent with our client’s overall patrimonial trajectory, and to coordinate with the avocats fiscalistes and notaires of our network for the detailed analysis.
We do not produce IFI calculations or provide IFI advice in our own name. We map the framework with you and ensure that the technical analysis is performed by the appropriate professionals.