The Impôt sur la Fortune Immobilière (IFI) is a French tax that applies to households holding a net taxable real estate portfolio above a certain threshold. In 2025, this threshold remains set at €1.3 million. This article guides you through the current IFI regulations, its tax brackets, potential exemptions, and the steps to declare and optimize your tax situation.
Eligibility threshold and IFI brackets in 2025
In 2025, the IFI applies to households whose net taxable real estate assets exceed €1.3 million as of January 1, 2025. This value is calculated after deducting any debts linked to the properties (loans, renovation work, etc.).
This threshold has not been adjusted since the IFI was introduced in 2018. With the continuous rise in property prices — particularly in metropolitan areas and attractive regions — more and more households now exceed this threshold, often without realizing it.
To avoid overestimating your taxable base, it is essential to carry out an accurate property valuation and to include all deductible charges.
To get a preliminary estimate of your property’s value, visit: www.capifrance.fr/fr/estimation
Contact one of our real estate advisors for a full valuation: https://www.capifrance.fr/fr/conseillers
Progressive IFI brackets in 2025
IFI is calculated based on a progressive scale. It only applies to the portion of net taxable real estate exceeding €800,000 — not the entire portfolio.
| Net taxable real estate value (€) | Tax rate |
|---|---|
| Up to €800,000 | 0% |
| €800,001 to €1,300,000 | 0.50% |
| €1,300,001 to €2,570,000 | 0.70% |
| €2,570,001 to €5,000,000 | 1.00% |
| €5,000,001 to €10,000,000 | 1.25% |
| Over €10,000,000 | 1.50% |
Note: Although the taxable threshold starts at €1.3 million, the tax brackets begin at €800,000. This helps soften the initial impact of taxation for households near the entry point.
IFI calculation:
IFI is based on a progressive tax bracket system, applied to the net taxable value of your real estate (i.e., property value minus deductible debts). While the mechanism is relatively easy to grasp, it's advisable to seek guidance to avoid errors in estimation or omissions.
To assist you, the French government provides a free official simulator on the service-public.fr website. This tool offers a quick estimate of your IFI liability for 2025 based on your asset breakdown. It doesn’t replace an official declaration but is a useful tool for forecasting.
Rebate for assets between €1.3 and €1.4 million
A rebate is automatically applied when your net taxable estate falls between €1.3 million and €1.4 million. The formula is as follows:
Rebate = €17,500 – (1.25% × net taxable real estate value)
Example:
Net taxable estate: €1,350,000
Gross IFI: €2,850
Rebate: €625
IFI due: €2,225
This mechanism helps soften the threshold effect for taxpayers just over the limit.
Which properties are included in IFI, and who is subject to it?
The following are included in the IFI taxable base:
Main and secondary residences (in France or abroad),
Building plots or non-developable land,
Listed buildings (under certain conditions),
Properties under construction,
Shares in companies owning non-professional real estate (SCI, SCPI, etc.),
Shares in commercial companies holding real estate (SASU, SARL, etc.).
Exclusion: Real estate assets used for a professional activity that is genuinely and primarily exercised by the owner are excluded from the IFI.
30% deduction on the main residence
Your main residence benefits from a 30% allowance on its market value, only if it is directly owned.
Examples:
Property worth €1,300,000 → taxable value after deduction: €910,000 → not liable for IFI.
Property worth €2,000,000 → taxable value: €1,400,000 → IFI payable (with possible rebate).
⚠️ If the main residence is held within an SCI (real estate company), no deduction applies.
IFI declaration: what to know in July 2025
The IFI must be declared each spring, at the same time as your income tax return. As of July 2025, the declaration period is already closed.
Past deadlines for the 2025 campaign:
Zone 1 (departments 01 to 19): May 22, 2025
Zone 2 (departments 20 to 54): May 28, 2025
Zone 3 (departments 55 to 976): June 5, 2025
Paper filing: May 20, 2025
Declarations must be filed via impots.gouv.fr using form 2042-IFI, attached to your income tax return.
IFI payment: upcoming deadline
The IFI payment deadline remains September 15, 2025 (unless otherwise specified). A separate tax notice will be issued at the end of summer.
Payment methods:
Direct debit (if activated),
Online payment on impots.gouv.fr,
Bank transfer or credit card.
In the event of a dispute over valuation, taxpayers must pay on time and then lodge an appeal. Late payment incurs interest (0.20% per month) and penalties.
Optimizing IFI in 2025
Here are some strategies to reduce your IFI liability:
Donations to public interest organizations: 75% tax reduction, capped at €50,000/year,
Early transfer: Gifting property to your children under certain conditions,
Structuring via SCI: Distributing property ownership can reduce the taxable base.
These options should always be explored with the help of a tax advisor.
Which assets are exempt from IFI?
Some properties are excluded from the IFI taxable base, including:
Real estate assets used in a genuine, principal professional activity by the owner (e.g., workshop or commercial space),
Property held by a sole proprietorship or company, provided its use is strictly professional and essential to the activity,
Shares in companies where the taxpayer carries out their main professional activity and the company holds professional-use real estate,
Woodlands, forests, and forestry group shares, subject to sustainable management (minimum 30-year commitment),
Rural property rented on long-term leases (18 years or more), and shares in agricultural land groups (GFA), under certain conditions.
These exemptions apply only if strict criteria set by the tax authorities are met. When in doubt, seek professional advice.
Conclusion
In 2025, the IFI applies to any household whose net taxable real estate assets exceed €1.3 million. To manage your liability effectively, it is essential to:
Know the rules and deductions,
Properly evaluate your property,
Respect declaration deadlines,
Anticipate and optimize when needed.
FAQ
What is the real estate wealth tax (IFI)?
The IFI is a French tax that replaced the wealth tax (ISF) in 2018. It only applies to individuals whose net taxable real estate assets exceed €1.3 million as of January 1 of the tax year. It includes both directly and indirectly held property (via companies), but excludes financial and professional assets. The IFI is calculated using a progressive tax scale and must be declared annually with the income tax return.
Can I exclude my main residence from IFI?
No, but a 30% deduction applies if the property is held directly.
How is IFI calculated if my assets slightly exceed €1.3 million?
A rebate applies automatically between €1.3M and €1.4M, using the formula:
Rebate = €17,500 – (1.25% × net taxable estate)
Can I still declare my IFI for 2025?
No, the declaration period ended in June 2025. You will have to wait for the 2026 campaign.
Further reading:
Author:
Frédéric REMY, Director of Network Development at Capifrance
“As a real estate professional with several years of experience at Capifrance, I’m here to share key advice to help you succeed in your property project with the support of our advisors.”
