Tax credit 2023: What work can be deducted?
Many French people have chosen to work on their homes to optimize their comfort and well-being. In addition, homeowners want to move towards an energy transition that is sustainable and respectful of their home, while saving money. In fact, 41% of French people are satisfied with their homes, compared with 36% who are not very satisfied.
The French government has since set up a number of subsidies to help you carry out interior work, and thus move towards a responsible and ecological approach to sustainable development.
➜ What is the tax credit?
The tax credit is a state aid from which a taxpayer can benefit when carrying out certain work in his interior. This assistance is for middle-income and upper-income homeowners in single-family and condominium units. The only condition for taking advantage of the tax credit is that the home must have been in existence for 2 years, and the work must have been completed.
➜ How does it work?
Once the work has begun, the assistance is carried over to the following year after the work has been completed. It gives rise to a refund if the sum of the work exceeds the tax rate.
➜ What is MaPrime Renov?
Since 2020, the energy transition tax credit (CITE) has been replaced by MaPrime Rénov, as well as the aid provided by the Anah. MaPrime Rénov is an aid that subsidizes the renovation of certain interior works in homes built more than two years ago. With MaPrime Rénov, the principle remains the same as that of CITÉ, but this new aid includes new areas for improvement:
- a premium out of a sieve
- a low-energy building bonus
- a comprehensive renovation allowance
- an indemnity for project management
The conditions of MaPrime Rénov' have been made more flexible than those of the CITE. From now on, all homeowners can benefit from this assistance, whether they rent out their home or own it, and whatever their income.
The amount of MaPrime Rénov' will depend on 3 factors:
- Household income
- The work to be done
- The location of your home
➜ Are all jobs covered?
Only certain types of work are covered by MaPrime Rénov', namely energy transition and performance improvements:
- Insulation work
- Acquiring or changing heating systems
- Boiler or water heater replacement: wood, heat pump, solar thermal
- Establishment of a DPE
- Expenses and equipment for the elderly and disabled.
- The installation of a controlled mechanical ventilation
Work that results in the construction, expansion or remodeling of your home is not included in the MaPrime Renov program. The aim of Ma Prime Rénov is to encourage homeowners to improve the energy performance of their homes.
➜ Other aid that can be combined with MaPrime Rénov:
MaPrime Rénov' can be supplemented by other forms of assistance for energy transition projects:
- Energy bonus
- Assistance from Action Logement
- Assistance from certain local authorities
- The zero interest eco-loan: this is an interest-free loan to finance your work
- Reduced VAT
MaPrime Rénov grants cannot be combined with aid from the Anah (National Housing Agency). These aids are intended for owners or lessors who wish to set up an energy plan for their home. The work covered by Anah is similar to that of MaPrime Rénov: insulation, DPE diagnosis, etc. To benefit from the Anah, your residence must be at least 15 years old.
➜ What work is deductible?
If your work does not meet the MaPrime Rénov' conditions, it is possible for you as a homeowner to benefit from a tax reduction on completion of your work.
The replacement of windows is deductible from 15% of your taxes. Similarly, renovating your bathroom or kitchen is tax-deductible.
All renovations aimed at improving the energy performance of your house or apartment are tax-deductible up to 30%, particularly for hot water production using wood or solar energy.
Gardening work is eligible for a tax deduction. This work includes garden maintenance such as hedge and tree trimming or lawn mowing. However, to benefit from this deduction, certain conditions must be met: as an owner, performing these tasks must be worth hiring an employee or an approved organization.
Replacing or installing an entrance door is also eligible for a tax reduction.
For exterior work, only minor repairs to your roof are tax-deductible. Any reconstruction or extension of your apartment apartment or house are not tax-deductible. This means that major works such as changing the roof or renovating the facade are not included in the reduction of your annual expenses.