Benefiting from a VAT
with reduced rate
In certain neighbourhoods and under certain conditions, the purchase of a new flat is eligible for the reduced rate of VAT (5.5%).
Who can buy?
In order to benefit from VAT at the reduced rate, the purchaser must acquire the dwelling as his main residence. In addition, he has to comply with means ceilings which are updated each year.
Which housing to buy?
Only new homes located in certain neighbourhoods are eligible. These are certain neighbourhoods covered by a renovation agreement (known as "ANRU zones") or priority neighbourhoods in the city (known as "QPV") as well as in the outskirts of these neighbourhoods.
In order to benefit from the reduced VAT rate, the purchaser undertakes to keep the accommodation for use as his main residence. This means that it is not possible to rent out the dwelling< or to use it as a secondary residence.
Failure to comply with this commitment exposes the purchaser to the payment of additional VAT on the resale of his property. On the other hand, the increase in the purchaser's income during the period of ownership of the property does not give rise to a VAT supplement on resale.
What are the advantages?
If the conditions relating to the purchaser and the building are met, the purchaser may benefit from the reduced rate of VAT. In addition, the sale price of the dwelling is subject to a reglementary ceiling.