Second Homes: Five Tax Pitfalls to Avoid Before Signing
Whether it’s a family home or a beachfront getaway, a second home is the stuff of dreams. But behind that instant attraction lies a full-fledged asset, for which the tax framework has become significantly stricter in 2025–2026. We take a closer look with the wealth planning experts at Meeschaert.
Summer brings everyone back to a certain place: the family home where we gather, or the beachside rental we’d love never to leave. And with it comes a recurring temptation—the urge to take the plunge and buy a second home. A project centered on enjoyment and sharing that, behind the scenes, raises a series of legal and tax questions that people rarely think about when signing on the dotted line. After all, a second home is a distinct asset in its own right, and every step of the process deserves careful planning.
Especially since the regulatory framework has tightened significantly. The reduction in the threshold and tax deductions for the “micro-BIC” under the Le Meur Act has reshuffled the deck for furnished tourist rentals, while the new “holding company tax” in the 2026 Finance Act complicates certain corporate structures. Added to this is a housing tax on second homes that has indeed been maintained—and even increased, by up to 60 percent—in many municipalities located in high-demand areas. Without proper planning, Meeschaert warns, a vacation home can quickly turn into a source of stress, or even family conflicts.
Ownership and Rental: Making the Right Choices
The first step: choosing the right ownership structure. Should you buy directly, through an SCI, or via a corporation? Direct ownership is the simplest option, but it exposes you to joint ownership in the event of inheritance—a common source of disputes among heirs. An SCI, on the other hand, facilitates joint management and, above all, the gradual transfer of shares to children, though at the cost of more cumbersome formalities (articles of incorporation, accounting, and shareholder meetings). The right decision depends on the family’s plans, the financing method, and the intended holding period.
Second point to consider: rental profitability. Following the Le Meur Act, is seasonal rental still a sound financial decision? The reduction in tax deductions and revenue caps under the micro-BIC regime makes it necessary to precisely recalculate the net return by comparing the micro-BIC regime with the actual income regime. Depending on the situation, switching to the actual tax regime—which allows you to deduct expenses and depreciate the property and furnishings—may once again become the most advantageous option. This decision is all the more important given that many tourist towns now strictly regulate furnished vacation rentals, with requirements for change-of-use permits and occupancy quotas.
IFI, capital gains, property transfer: planning for exit strategies
Third pitfall: the real estate wealth tax (IFI). Unlike a primary residence, which qualifies for a 30% exemption, a second home is included in the IFI tax base at its full value. A purchase can thus push a person’s net real estate assets above the €1.3 million threshold and make the owner liable for the tax—sometimes without them having anticipated it.
Fourth topic: resale. Capital gains on a second home are not tax-exempt, unlike those on a primary residence. They are subject to deductions based on the length of ownership, with an income tax exemption after twenty-two years and an exemption from social security contributions only after thirty years—a long-term consideration to factor in at the time of purchase, especially when financing with a loan.
Another prerequisite that’s all too often overlooked: calculating the true cost of ownership. Property taxes, condominium fees, maintenance, insurance, utilities… a second home used for only a few weeks a year can cost several thousand euros annually, not counting the mortgage. It’s often this calculation—more than the purchase price—that tips the scales between buying and renting on an occasional basis. It’s worth asking this question with a clear head, far from the excitement of vacation, while taking into account how often you’ll actually use the property and whether or not you can rent it out for part of the year to offset these expenses.
Fifth and final point: asset transfer. Donating full ownership or bare ownership, splitting ownership, holding assets through a real estate investment company (SCI) whose shares are transferred, or using a life insurance beneficiary clause to balance the distribution among heirs… there are many options, but they must be planned well in advance to be fully effective. Planning ahead helps avoid the twin pitfalls of unexpected tax liabilities and family tensions surrounding an asset that is often emotionally charged. For each of these five steps, Meeschaert’s wealth management advisors are available to assist editorial teams in clarifying the process to follow.
