Jeanbrun Scheme: Tax Incentives for Rental Homes

In January 2026, the French government launched a new tax incentive, the Jeanbrun scheme, to promote investment in residential rental properties.

This initiative addresses an approximately 15% decrease in rental supply over the past 15 years, which has particularly affected students and young professionals. The goal is to facilitate the construction of up to two million new homes.

How the Jeanbrun Scheme Works

Individuals who invest between 21 February 2026 and 31 December 2028 in the acquisition or construction of residential property intended for unfurnished rental as a tenant’s primary residence may benefit from a tax advantage in the form of depreciation deductible from rental income.

Eligibility and Property Types

The dispositif Jeanbrun is open to individual investors, as well as certain French entities such as Sociétés Civiles Immobilières (SCI’s) and applies to new-build properties as well as certain renovated older properties.

As depreciation is generally not available for unfurnished rental properties, this represents a significant advantage of the regime.

Rental Conditions

The owner must commit to renting the property unfurnished, for use as the tenant’s primary residence, to a person who is neither a member of their tax household nor a close family member, for a minimum period of 9 years.

Depreciation Rates and Deduction Limits

Depreciation under the Jeanbrun scheme is determined based on the property’s acquisition cost, excluding the land value. For the purposes of this calculation, the land component is deemed to represent a flat rate of 20 per cent of the total purchase price.

The applicable depreciation rate depends on the property type and its designated rental category: intermediate, social, or very social. 

• For new properties, the rates are as follows: 3.5 per cent for intermediate rent, 4.5 per cent for social rent, and 5.5 per cent for very social rent.
• For rehabilitated existing properties, the rates are 3 per cent for intermediate rent, 3.5 per cent for social rent, and 4 per cent for very social rent.

It is important to note that the total annual depreciation deductions permitted under this scheme are limited to eight thousand euros per tax household.

This cap is increased by €2,000 where at least 50% of the gross income from the depreciated properties is derived from social rental, and by €4,000 where this threshold is met for very social rental.

Depreciation may create or increase rental losses. Unfurnished rental losses (excluding mortgage interest) arising in a tax year may be set against the taxpayer’s other income, up to a limit of €10,700. Other income includes employment and pension income.

Loss Relief and Carry-Forward

Any remaining losses (including those attributable to mortgage interest) may be carried forward for up to ten years and offset against future profits from unfurnished rental income.

Non-Compliance and Sale Consequences

Failure to comply with any of the scheme’s conditions results in the withdrawal of the tax benefit. The amount of depreciation previously deducted is added back to the net rental income for the year in which the reassessment takes place. Non-compliance includes, in particular:

• The property is sold before the end of the required letting commitment period (i.e. before the completion of the 9-year minimum period needed to qualify for the scheme).
• Failure to meet the obligation to let the property as the tenant’s principal residence in accordance with the applicable legal conditions (including exceeding permitted rent or tenant’s income thresholds, letting the property to a family member, any interruption in the rental period, etc.).

It is important to note that any depreciation claimed must be added back when calculating the taxable capital gain on disposal. Upon sale, the capital gain is determined as the difference between the sale proceeds and the property’s written-down value. Consequently, a portion of the tax savings realised during the holding period is effectively clawed back on disposal.

Legal and Tax Advice in France

Our legal partner, François Mouniélou at RWK Goodman, focuses on taxation, inheritance, and succession for international buyers and investors of property in France. Feel free to contact Mr Mouniélou and his team for more details about the scheme or to schedule a consultation.

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