By Benjamin Roure L'Hermitte
France's real estate wealth tax, the IFI (impôt sur la fortune immobilière), replaced the old wealth tax, the ISF, in 2018 and applies only to real estate. In 2026, it concerns households whose net taxable real estate exceeds €1.3 million on January 1, with rates from 0.50% to 1.50%. The « tax on unproductive wealth » voted by the National Assembly in October 2025 was not kept in the 2026 Finance Act: the IFI applies with its usual rules. This guide covers the threshold, the scale, worked examples, what is taxable, how to reduce it and how to declare it, for residents and for non-residents who own property in France.
- €1.3 million threshold of net taxable real estate on January 1, 2026, after a 30% allowance on the main residence.
- Rates from 0.50% to 1.50%, applied from €800,000 once the threshold is crossed, with a reduction between €1.3 and €1.4 million.
- No tax on unproductive wealth in 2026: voted at first reading on October 31, 2025, it is not in the Finance Act of February 19, 2026.
- Donations: 75% of gifts to certain organisations is deducted from the IFI, up to €50,000.
The ISF, abolished at the end of 2017, taxed all wealth. The IFI counts only real estate assets and rights, held directly or through companies and real estate investments. Financial investments, bank accounts and life insurance invested outside real estate are not included.
The rules quoted come from the official 2026 tax guide published by impots.gouv.fr. For large or complex holdings, a notaire or a wealth manager can refine the valuation.
TL;DRIn 2026, the French IFI applies to households whose net taxable real estate exceeds €1.3 million on January 1. Rates run from 0.50% above €800,000 to 1.50% above €10 million, with a reduction between €1.3 and €1.4 million. The main residence gets a 30% allowance, and property debts are deductible. Donations cut the IFI by 75%, up to €50,000. The tax on unproductive wealth was not kept in the 2026 Finance Act.
What is the IFI?
The IFI is an annual tax on a tax household's net real estate wealth, valued on January 1. French residents pay it on their real estate in France and abroad; non-residents pay it only on real estate located in France. Net wealth is the value of taxable assets minus the deductible debts relating to them.
The 2026 threshold and scale
| Portion of net taxable real estate | Rate |
|---|---|
| Up 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% |
| Over €10,000,000 | 1.50% |
The scale only applies if net taxable wealth exceeds €1.3 million; it is then calculated from €800,000. For wealth between €1.3 and €1.4 million, a reduction equal to €17,500 minus 1.25% of the wealth eases entry into the tax.
Calculating the IFI: examples
| Net taxable real estate | Calculation | IFI 2026 |
|---|---|---|
| €1,350,000 | 2,500 + 350 − reduction of 625 | €2,225 |
| €2,000,000 | 2,500 + 4,900 | €7,400 |
| €3,000,000 | 2,500 + 8,890 + 4,300 | €15,690 |
The main residence allowance often makes the difference. A household with a €1,000,000 main residence and a €600,000 rental flat, with no debt, declares €700,000 for the main residence after the 30% allowance, plus €600,000, or €1,300,000: it is not liable, since the threshold must be exceeded.
What counts as taxable wealth
- Taxable: main residence (after the 30% allowance), second homes, rental properties, land, buildings under construction, and the real estate share of company shares, SCPI units or real estate units in a life insurance contract.
- Exempt or partly exempt: assets used in the taxpayer's business under conditions, woods and forests up to 75%, and rural property on long leases in part.
- Deductible debts: loans taken out to buy, build or renovate a taxable property, and related taxes such as property tax, under the conditions set by law.
Properties are declared at their market value on January 1, the price they would fetch on the market. An undervaluation can be reassessed by the tax authorities.
Reducing the IFI
- Donations: 75% of sums given to certain public-interest bodies, foundations or research institutions is deducted, up to €50,000 a year. A €2,000 gift cuts the IFI by €1,500.
- The cap: the IFI is reduced if, together with income tax and other taxes due, it exceeds 75% of the previous year's income.
- Debt: a loan for a taxable property reduces net wealth, within the limits set by law.
- Passing assets on: a lifetime gift removes the property from the donor's wealth; see our guide to gifts to grandchildren and between spouses.
Tax on unproductive wealth and the « new ISF »: voted, then dropped
During the 2026 budget debate, the National Assembly voted on October 31, 2025, at first reading, to turn the IFI into a tax on unproductive wealth, which would also have covered assets such as gold, crypto assets, cash or certain euro funds. The measure was not kept in the Finance Act for 2026 of February 19, 2026: the official 2026 tax guide describes the IFI with its usual rules and scale. A « new ISF » remains a subject of debate, not a rule in force.
Declaring the IFI
The IFI is declared in spring alongside income tax, on form 2042-IFI, online for most households. The wealth counted is that on January 1 of the year. The tax is then paid with the income tax balance, on the same notice. Non-residents declare only their real estate located in France.
Frequently asked questions
What is the IFI threshold in 2026?
€1.3 million of net taxable real estate on January 1, 2026, after the 30% main residence allowance and deduction of debts.
What are the 2026 IFI rates?
0% up to €800,000, 0.50% up to €1.3 million, 0.70% up to €2.57 million, 1% up to €5 million, 1.25% up to €10 million and 1.50% above, once the €1.3 million threshold is exceeded.
Is the tax on unproductive wealth in force?
No. Voted at first reading by the National Assembly on October 31, 2025, it was not kept in the 2026 Finance Act: the IFI applies.
Is the main residence subject to the IFI?
Yes, with a 30% allowance on its market value on January 1. A €1,000,000 home counts for €700,000.
Do non-residents pay the French IFI?
Yes, on their real estate located in France only, if its net taxable value exceeds €1.3 million on January 1.
When is the IFI declared?
In spring, with the income tax return, on form 2042-IFI; the tax is paid with the income tax balance.