Any taxpayer domiciled in France, who purchases a new or off-plans accommodation between January 1, 2016, and December 31, 2017, can benefit from the Pinel system. The PINEL investment opens a right to a rebate on income tax that can reach €6,000 per year during 9 to 12 years.

Which tax exemption with the PINEL law ?

The investor can receive up to € 63,000 in tax advantages over 12 years.
Tax exception in real estate pursuant to the Pinel law is calculated on the amount of the real estate property. It varies based on the term of the rental.

Rate of the tax credit over 6, 9 and 12 years
The tax reduction varies based on the term of the rental

For a term of 6 years of rental, the tax credit is of 12%.
For a term of 9 years of rental, the tax credit is of 18%.
For a term of 12 years of rental, the tax credit is of 21%.

Conditions to comply with

The PINEL System aims at creating a new offer of housing on the French territory, a certain number of points are to be applied.

1- Rental conditions

The owner must rent the accommodation as a main residence of a tenant.
The term of the rental must of 6 years minimum.
The accommodation must be rented within 12 months of the delivery of the property (Date of works completion)
The owner commits to comply with the limits of rent and tenant income.

2- Condition of approval of the tax exemption

The tax credit based on the Pinel law is not cumulative with the Duflot, Scellier, Censi- Bouvard, Malraux laws or any building classified as a historical monument.
The Pinel system is concerned by the upper limit for tax incentive measures set to € 10,000 per year.

Which accommodation eligible to the PINEL law

To be eligible to the PINEL law and benefit from the tax exemption on the real estate property must be built to the BBC standards: RT2012 or BBC2005 and must be located in a city in zone A, Abis or B2.

The following types of investments are eligible:

  • A new accommodation, off-plans (VEFA)
  • The construction of an accommodation;
  • The purchase of an uncompleted accommodation in view of its completion
  • The subscription into the capital of SCPI (a civil company of investment in real estate)

The zones in PINEL law

The French cities are classified into zones

ZONE A BIS: Paris and immediate periphery
ZONE A: Large cities of more than 250 000 inhabitants
ZONE B1: Large cities between 150 000 and 250 000 inhabitants
ZONE B2*: Average cities between 50 000 and 150 000 inhabitants
ZONE C: The rest of the territory. Not applicable.

* The accommodations located in zone B2 can see the Pinel system applied, provided the city has received an accreditation by the Regional Prefect.

Can you rent to ascendant or a descendant

Yes, it is now possible to rent to an ascendant (parents) or a descendant (children) provided the tenant is not part of the landlord's tax household.

PINEL law and SCPI

From September 1, 2014, the SCPI are eligible on the same level as the real estate properties. 100% of the subscription is taken into account.