Posted on Sep 05, 2023
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Written by Thomas Saint-Antonin
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The amount of property tax soared in 2023, in particular due to the increase in cadastral rental values. However, did you know that it was possible to challenge the increase in this local tax? All the details.
A possible appeal before the Administrative Court
The first tax notices will be sent this Wednesday, September 6, 2023 for non monthly taxpayers. Unfortunately, the note promises to be salty for the owners of certain municipalities. +7,1 % due to inflation, to which must be added that voted by the municipalities, which can reach +60% in the Paris region This year. But then, a dispute of Is a property tax increase possible? Imagine that yes and that is precisely what happened to Thiers (Puy-de-Dome) and to Lyon (Rhône-Alpes) where legal actions were taken in 2022. Same thing at Marseilles (Bouches-du-Rhone). Indeed, the National Union of Property Owners (UNPI) announced last year that it wanted to attack increases in property taxes, it is now done.
€20 billion
Or the amount of the shortfall for local authorities after the abolition of the housing tax.
In 2022, the property tax increased by 12% in Marseille, a news that had not been passed on to the owners. An appeal to the administrative court was filed by 300 of them. Justice then hadcanceled the city’s 2022 budgetof which this significant increase in the property tax was a part by giving the possibility of vote again before September 30, 2023. Result of the races: the amount of property tax has not changed one iota. However, fortunes should be diverse in terms of recourse. In 2023, three deputies to the town hall of Grenoble, hostile to the increase in the property tax (+33.2% in Grenoble (Isère) this year, the 3rd largest increase at the national level) were deprived of their delegations in the Municipal Council. Ambiance.
How do I dispute my property tax?
An owner has the possibility of contesting the amount of his property tax, in particular after a revaluation of its cadastral rental value. The dispute request must be sent before the December 31, 2023 on the site impots.gouv.fr from your private space, then in the “Contact us/My secure messaging” section. If the complaint does not exempt you from paying the tax, you can attach to your request, a request for suspension of payment so as not to have to pay the disputed amount. If the amount is over €4,500a Bank guarantee may be required of you. The suspension of payment applies as long as the dispute has not been settled, either by the taxman either by the competent court of first instance. The processing time can reach 6 months plus 3 additional months. If your request is accepted, a abatement notice or refund will be sent to you. If it is refused, then you will have 2 months to request an appeal in court. If you want to leave it at that, you will have to pay the disputed tax and an 10% surcharge for late payment.
Why is property tax going up?
The impressive increase in property tax in some municipalities is primarily due to thesoaring cadastral rental values which serve as the basis for the calculation of the property tax. These values had not been revised since 1970. In 2023, to compensate for the general increase in prices following the war in Ukraine, the cadastral rental values rose by 7.1% for all owners. But the increases don’t stop there. Indeed, the tax rate voted annually by local authorities may also increase in your municipality. This is the case in many French cities, such as Paris, Grenoble or Metz. This increase in the property tax could also be linked to thepermanent waiver of housing tax on primary residences. Indeed, the end of the housing tax was to be compensated by a excess tax revenue through growth. Lack of luck, the Covid has been there, causing an unprecedented economic crisis.
To know
The cadastral rental values will no longer be revised before 2028.
Therefore the finance bill 2020 introduced what is known as the correction coefficient“. In other words, the transfer of the share of property tax on built properties collected by the departments to municipalities. Surplus municipalities contribute the surplus to a fund pour fill the gap accumulated by cities in difficulty. Issue, this device excludes the real state of the communes since the implementation of the reform. This explains the increase in local taxes (property tax, household waste collection tax). For its part, the introduction of the tax return on real estate cannot yet explain an increase in the property tax. Even if the declaration of a swimming pool, or an extension can change the cadastral value of the property and therefore, its taxation. Nothing will happen before the declarative campaign 2024 due to the duration of the computer processing of the Directorate General of Public Finances (DGFiP).
In summary
It is possible to contest the increase in the amount of your property tax; The steps to contest your property tax are carried out on the site impots.gouv.fr; 300 Marseille owners filed an appeal before the administrative court in 2022, bringing the municipality to cancel the annual budget and schedule a new vote; The increase in the property tax is explained in particular by the surge in cadastral rental values, the tax rates voted by local authorities and the famous correction coefficient. Also read about landlord taxes
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Thomas Saint-Antonin
Web editor, specialized in economics and wealth management.
I deal with all subjects revolving around wealth management. I strive to offer you the most far-sighted and incisive analysis possible on all of our digital media. Excellent reading to all.
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