For a Parisian rental investor, the LMNP status is a fiscal weapon of mass destruction… of taxes. Depreciation, deductions, real regime: well used, it can reduce your taxes to zero for 10-15 years. Here is the complete guide.
1. What is LMNP status?
LMNP (Loueur en Meublé Non Professionnel, non-professional furnished landlord) is a French tax status applicable to any owner who rents furnished property. To be qualified as such:
- The property must be furnished (and not unfurnished)
- You must not live primarily off these revenues (less than 23,000€/year or less than 50% of your total income)
- You must declare your activity to the URSSAF (free, 5 minutes)
Above 23,000€/year and 50% of income, you switch to LMP (Professionnel) status — different regime, more taxed but with social advantages.
2. Two regimes: micro-BIC vs real
LMNP offers 2 tax regimes. The choice is decisive for your real taxation.
Micro-BIC: simplicity
Automatic flat allowance: 50% on rental revenues, capped at 77,700€ of revenue. Simple, no accounting needed.
Concrete example: 30,000€ of annual rents → 15,000€ taxable (after 50% allowance) → ~5,500€ of tax (TMI 30%).
Real regime: real-cost optimisation
Deduction of all real expenses: loan interest, accountant fees, charges, insurance, repairs, agency fees, depreciation of the property and furniture.
The keyword: depreciation. You deduct each year a fraction of the value of your property (typically 2.5-3% of the structure value, 10% of furniture).
3. The miracle of depreciation
This is where LMNP becomes magic. Concrete example:
- Property purchased 500,000€ in Paris (350,000€ structure + 100,000€ land + 50,000€ furniture)
- Annual depreciation: 350,000 × 2.8% = 9,800€ (structure) + 50,000 × 10% = 5,000€ (furniture) = 14,800€/year
- Over 30 years, you deduct nearly 450,000€ from your taxable revenues
Result: with 30,000€ of rents and ~25,000€ of total expenses (interest + depreciation + charges), your taxable rental income is close to zero for 10-15 years.
4. The trap: real depreciation
LMNP depreciation does not impact your accounting situation, but it does have an impact when reselling. The capital gain is calculated on the original purchase price, not on the depreciated value.
However, since 2026 (Loi Le Meur), depreciation is reintegrated into the calculation of capital gains on resale. This is a major change that significantly reduces the long-term advantage of LMNP, even if the regime remains very advantageous in operation.
5. Which regime to choose?
Decision-making rule of thumb:
- Below 30,000€ of rents/year, no loan: micro-BIC is often sufficient and avoids accountant fees.
- Above 30,000€/year OR if you have loan interest: the real regime is almost always more advantageous.
- Recent investment with high loan: the real regime is almost mandatory, otherwise you pay tax on income you don't really have.
6. The administrative obligations
For the real regime:
- Mandatory chartered accountant (or specialist online accountant). Cost: 600 to 1,200€/year.
- Detailed accounting (income journal, depreciation, balance sheet)
- Tax declaration via form 2031 (annexe to your 2042 declaration)
- Membership of an Approved Management Centre (CGA): mandatory for full optimisation
Conclusion: LMNP, the most powerful French rental tool
Despite the 2026 changes, LMNP remains the most powerful rental tax tool in France. For an investment of 500,000€ in Paris, the real-regime LMNP can save you 50,000 to 100,000€ in taxes over 10 years. Full Concierge works with partner accountants specialised in LMNP — we orient our owners towards the most advantageous setup.