IZIX Conciergerie - LMNP, LMP, micro-BIC or real: how to optimize the taxation of your furnished rental in 2025?

In 2025, furnished rentals are one of the most popular investments for individuals wishing to build up a wealth while generating income. More flexible and more profitable than bare renting, it allows you to benefit from considerable tax advantages, provided you master the different statuses and tax regimes. Between the status of Non-Professional Furnished Rental Company (LMNP) or Professional (LMP), and micro-BIC or real regimes, the choice of taxation can have a decisive impact on the net profitability of your investment. This article guides you clearly and comprehensively to understand the issues and make the right choices.

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LMNP or LMP: two statuses to supervise your activity

The status LMNP (Non-Professional Furnished Rental) is the most frequently used by individuals. It concerns landlords who receive less than 23,000 euros in annual revenue from furnished rentals, or whose income is lower than the other income from the tax household (salaries, BIC, etc.). The LMNP status offers great management flexibility, reduced taxation, and above all the possibility of opting for the real regime in order to benefit from the depreciation of the property.

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The status LMP (Professional Furnished Rental Company), for its part, is aimed at lessors whose furnished rental income exceeds 23,000 euros per year and exceeds all other business income. It is therefore a professional activity, which involves more stringent social and fiscal obligations, but opens the way to certain advantages, in particular the possibility of imputing deficits to total income, and under certain conditions, to be exempt from tax on capital gain upon resale.

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Micro-BIC or real: choosing the most advantageous tax regime

The Micro-Bic diet is a simplified regime applicable automatically if revenue does not exceed certain thresholds: 77,700 euros for a classic furnished rental, 15,000 euros for unclassified furnished tourist accommodation, and up to 188,700 euros for classified furnished apartments or guest rooms. It provides for a lump-sum reduction on revenue: 50% for classic furnished furniture, 30% for unclassified furniture, and 50% for classified furniture. This regime is simple but not very optimized, as no real load can be deduced.

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On the other hand, the Real regime allows you to deduct all real expenses: loan interest, notary fees, notary fees, works, insurance, condominium fees, as well as the depreciation of real estate and furniture. This depreciation greatly reduces, or even eliminates, the tax result, which often makes it possible not to pay taxes for several years. The real regime is particularly suitable for investors with a mortgage or significant expenses.

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Social security contributions and deductions: what are the impacts on your income?

In LMNP, net income is subject to social security contributions up to 17.2%. However, you are not liable for URSSAF social security contributions, unless you exercise the activity professionally and are registered as such.

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In LMP, the lessor is affiliated to URSSAF and must pay social security contributions on the profit made, at a rate of between 35% and 45%. In return, this income is not subject to social security contributions at 17.2%. It is therefore essential to compare the total social security contributions according to the system chosen.

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Real estate capital gains: LMNP or LMP regime?

Until 2024, LMNP investors could depreciate their property each year to reduce their tax base, without these depreciations being reinstated during the resale. This allowed for extremely advantageous taxation, as the capital gain was calculated only on the difference between the sale price and the purchase price, depreciation not taken into account.

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Since the 2025 finance law, this fiscal niche has been Deleted. From now on, the amortization applied must be reintegrated into the calculation of capital gain. This means that the tax base is increasing, which leads to an increase in resale taxation. For example, a property purchased 200,000 euros, amortized to the tune of 100,000 euros and sold for 300,000 euros, will be considered for tax purposes as having been acquired 100,000 euros, thus generating a taxable capital gain of 200,000 euros.

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In LMP, depreciation had already been reinstated for several years. An exemption is still possible if the lessor has been active for more than 5 years and if his income does not exceed 90,000 euros per year.

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VAT and CFE: additional obligations

Furnished rentals are, with some exceptions, not subject to VAT. VAT becomes applicable if the rental company offers at least three para-hotel services: reception, daily cleaning, linen supply, breakfast. In the majority of cases, furnished renters therefore avoid this obligation.

On the other hand, the CFE (Contribution Foncière des Entreprises) is due by all furnished renters, from the first year of activity. The amount varies according to the municipality, but is generally between 200 euros and 800 euros per year.

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Conclusion

The 2025 reform marks a turning point for the taxation of furnished rentals. The LMNP status, long considered a tax haven, is seeing its attractiveness reduced due to the reintegration of depreciation into capital gain. However, it is still interesting if the objective is to generate regular income. The choice between LMNP, LMP, micro-BIC or real must be carefully considered, depending on the investment strategy, the volume of expenses and the resale horizon. It is strongly recommended to carry out accurate simulations with a professional to adjust your taxation to your wealth objectives.

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