Cadastral rental value

by | Jun 6, 2024 | Definition | 0 comments

Cadastral rental value

When it comes to property taxation, the notion of cadastral rental value (VLC) is essential. Understanding this concept is not only essential for property owners, but also for any citizen wishing to understand the mechanisms involved in calculating local taxes.

What is cadastral rental value?

The cadastral rental value represents a theoretical estimate of the annual rent a property could generate if rented out. This value, established by the tax authorities, is used as the basis for calculating property tax and council tax. It also has an impact on capital gains tax andproperty wealth tax. It is therefore essential for taxpayers to understand the subtleties of its calculation.

Calculating cadastral rental value

Calculating the cadastral rental value is a complex procedure that takes into account several factors, including the surface area of the property, its location, its general condition and its use (residential, commercial, office). The periodic review of rental values is designed to adjust this basis to market realities. Taxpayers can contest this value if they believe it to be inaccurate, and benefit from a reduction in their tax burden if necessary.

Revision of rental values

The purpose of revising rental values is to make tax calculations more equitable by adjusting cadastral rental values that may have become obsolete over time. It is part of a move towards tax fairness, designed to better reflect the real value of properties in today’s rental market.

Impact on local taxes

As VLC is an essential component of local taxes, any adjustment can have a significant impact on the amount owed by homeowners. Property tax and council tax are the main items concerned. Capping mechanisms are in place to avoid too sudden an increase in taxes, thus preserving the budgetary equilibrium of households.

Capping mechanisms

Capping mechanisms such as the ” bouclier fiscal” (tax shield) and limits on the annual increase in cadastral rental value help to control and limit local tax increases. These mechanisms are designed to protect taxpayers from disproportionate increases.

Frequently asked questions

Here is a list of frequently asked questions about cadastral rental value.

How to contest the cadastral rental value?

To contest the VLC, you must submit a claim to the tax authorities. The taxpayer must justify his request by providing concrete evidence that the cadastral rental value of his property is overvalued.

Does cadastral rental value affect the sale of a property?

Yes, VLC can influence the decision of potential buyers, as it determines the future local taxes to which they will be subject. A high value can be a deterrent to selling.

Is it possible to have an abatement on the cadastral rental value?

Deductions for family responsibilities as part of the taxe d’habitation or special deductions in certain areas, such as tax-free zones, may be applied to the VLC.

Is the cadastral rental value the same for all types of property?

No, VLC varies according to the type of property (residential, commercial, etc.), its location and its specific characteristics. Each property category has its own specific evaluation criteria.

What is the link between cadastral rental value and property wealth tax?

The cadastral rental value is used to calculate thereal estate wealth tax (IFI), as this tax is based on real estate assets. A high VLC can therefore have a direct impact on the amount of the IFI.

In conclusion, cadastral rental value plays a central role in the French real estate tax system. Accurate calculation is essential to ensure fair taxation. Knowing and understanding your cadastral rental value, how it is calculated, and how to appeal in the event of disagreement with the tax authorities, is essential for all property owners.

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