Income tax - Rental investment in the former Law of Normandy (tax reduction)
Verified 21 March 2023 - Directorate for Legal and Administrative Information (Prime Minister)
Additional cases ?
The Denormandie scheme allows you to benefit from a tax reduction if you make a rental investment in a degraded old neighborhood. This housing must be located in certain municipalities.
Types of acquisitions
The tax reduction relates to the following housing units:
- Old housing being improved
- Premises converted into residential use
The work must represent at least 25% of the total cost of the operation.
The tax reduction relates to the transactions carried out between 28 march 2019 and 31 december 2025.
Location of the accommodation
The accommodation must be located in the following municipalities:
- Municipalities with a high need for habitat rehabilitation
- Communes in labeled areas City center
- Municipalities having passed a Land Revitalization Operation Agreement (LRCA)
To find out if a city falls under this scheme, you can use this simulator:
Nature of the work to be carried out
You must do one of the following work in the accommodation:
- Work to improve the energy performance of the housing of 20% at least (30% at least for individual accommodation)
- At least 2 types of work among boiler change, attic insulation, wall insulation, hot water production change, window insulation
- New living space creation (e.g. balcony, terrace or garage)
for work to improve the energy performance of the dwelling, the use of a certified professional Recognized guarantor for the environment (EGR) is recommended.
Find an EGR professional or architect
The work must be completed by 31 December 2e year after acquisition.
The tenant must not belong to your tax shelter.
Sound reference tax income shall not exceed the following limits:
You can check the area in which your investment is located with a simulator:
The accommodation must be rented naked (unfurnished) as main dwelling.
It must be rented at the latest 1 year after the completion of the building or after its acquisition.
The lease term must be 6, 9 or 12 years.
The monthly rent shall not exceed, excluding charges, the following ceilings:
Rent ceilings vary depending on the size of the dwelling application of a multiplier.
The ceilings may be reduced to take account of the particularities of local rental markets.
The tax reduction is calculated by taking into account the following:
- Housing acquisition cost capped at €300,000
- Ceiling of €5,500 per m² of living space.
You must also consider the overall cap on tax benefits.
Rate of tax reduction
The rate varies according to the duration of the lease commitment.
the rules are different overseas.
To fill your tax return, you can view the following documents:
- Explanatory notes
- Tax Return Brochure (indication of documents to be provided or retained)
Tenant Resource Limit and Rent Limit in 2023
Published on 1 January 2023
The applicable rent caps for a 2023 rental investment and for the Affordable Rent Facility are not yet known.
The 2023 resource ceilings for an intermediate rent agreement are not yet known.
This page will be updated when these amounts are published.
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- General Tax Code: Article 199vTax reduction scheme
- General Tax Code, Annex 3: Article 2k to 2sRent and resource ceilings
- General Tax Code, Annex 3: Article 46 AZA G to 46 AZA MTax reduction for rental investments
- Decree No. 2013-517 of 19 June 2013 on the reduction of rent ceilings and the approval of municipalities for tax aid for rental investment
- Decree n°2020-426 of 10 April 2020 on the conditions of application of the income tax reduction in respect of rental investment
- Order of 26 March 2019 on the list of municipalities qualifying for the tax reduction Denormandie
- Bofip-Taxes n°BOI-IR-RICI relating to tax reductions and credits
- Bofip-Taxes BOI-IR-RICI-365-20-20 relating to the old Denormandie scheme
- Bofip-Taxes n°BOI-BAREME-000017 relating to the rent and resource ceilings 2022 for rental real estate investment
- Check if your city falls under the "Denormandie" scheme
- Pinel/Duflot device calculator
- Know the area of his commune: A, Abis, B1, B2 or C
- 2023 Simulator: 2022 Income Tax
- Taxes: access your Special Space
- 2023 Online Income Tax Return 2022
- Income Tax Return (Paper)
- 2022 Income Tax Return 2021 - Tax Reductions and Tax Credits
- Income tax: return and reportable incomeService-Public.fr
- Income tax: deductions, reductions and tax creditsService-Public.fr
- Buying or selling a homeService-Public.fr
- Land Revitalization Operation (ORT)National Agency for Territorial Cohesion (ANCT)
- Tax SiteMinistry of Finance
- Tax reduction for rental investment "Duflot"National Agency for Housing Information (Anil)
- Tax reduction for rental investment "Pinel"National Agency for Housing Information (Anil)
- 2022 Practice Brochure - 2021 Income Tax ReturnMinistry of Finance
- Complying with the 2020 SOS to build your homeEcological Transition Agency (Ademe)
- Municipalities qualifying for the tax reduction DenormandieLegifrance