Important: this guide describes the legal and doctrinal framework. In practice, Girardin arrangements (especially industrial ones) must be validated by a professional (advisor/notary/tax lawyer), as having the tax advantage clawed back can be costly.
Overview: what "Girardin" means
The term "Girardin" is widely used to describe tax advantages linked to investment in France's overseas territories. Legally, it refers to several articles of the CGI, in particular: 199 undecies B (new productive investments, often called the "industrial Girardin") and 199 undecies C (overseas social housing).
The terms (rates, conditions, approval, excluded sectors, rebate obligations, operating period…) are governed by the legal texts (Légifrance) and the administrative doctrine (BOFiP).
Industrial Girardin (CGI 199 undecies B)
A tax reduction linked to new productive investments operated overseas. The structure can be direct (operating company) or go through a leasing arrangement (with an obligation to pass on part of the advantage).
Girardin social housing (CGI 199 undecies C)
A tax reduction linked to the acquisition / construction (and, under conditions, renovation/rehabilitation) of overseas social housing. The text sets the rate and the calculation basis.
Eligibility period: article 199 undecies B applies, subject to its conditions, to investments brought into service until 31 December 2029 (see the version in force on Légifrance). Likewise, the reduction under article 199 undecies C is extended until 31 December 2029 according to the BOFiP doctrine (referencing the 2023 budget law).
2026 conditions (official principles)
A. Tax residence
The "Girardin" income tax reductions target taxpayers domiciled for tax purposes in France (within the meaning of the CGI).
- Framework set out in the doctrine for overseas "income tax" schemes.
- For an industrial Girardin through a company: the benefit is proportional to the rights of the eligible shareholders.
B. Overseas location
The investments must be made/operated overseas, in the territories listed by the legal texts.
- Overseas departments (Guadeloupe, Martinique, French Guiana, Réunion, Mayotte) and certain collectivities (depending on the articles).
- Rates may vary by territory (BOFiP "scale").
C. Operating / holding period
The arrangements impose a minimum period of allocation to an eligible activity.
- Under the industrial Girardin, the assets must be allocated to an eligible activity for 5 years (or their normal period of use if shorter), and shareholders keep their shares for 5 years in certain structures.
Industrial Girardin: excluded sectors & approval rules
The 199 undecies B scheme excludes certain business sectors and requires, for certain investments, prior approval (depending on the nature/amount/sector). These points are detailed in the BOFiP.
Rebate (leasing arrangements)
In leasing structures, part of the tax advantage must be passed on to the operator in the form of a lower rent and/or sale price. The doctrine notably mentions a rebate rate that can be reduced to 56% in certain cases (notably below a per-programme threshold).
Industrial Girardin (199 undecies B): official rates (BOFiP)
The BOFiP publishes a scale of tax reduction rates by territory and investment method (direct / leasing structures with rebate).
Reference: BOI-BAREME-000020| Category (extract from the scale) | Direct investment (operating company) | Leasing structure (66% rebate) | Leasing structure (56% rebate) |
|---|---|---|---|
| Rate "excluding territorial / sector increases" | 38.25% | 45.3% | 44.12% |
| French Guiana, Mayotte, Saint-Pierre-et-Miquelon, Wallis-and-Futuna | 45.9% | 54.36% | 52.95% |
| Renewable energy (excluding territorial increase) | 45.9% | 54.36% | 52.95% |
The BOFiP scale also provides for increases for certain sectors (e.g. hotel rehabilitation) and certain territories. For a comprehensive reading (rates and special cases), refer to the official scale and to the text of article 199 undecies B.
Tax-break caps: €10,000 / €18,000
Overall cap (general rule)
The overall cap on tax advantages ("tax breaks") limits the total annual benefit. The Service-Public fact sheet (verified on 01/01/2026) explains the principle and the amounts.
Specific €18,000 cap
Certain schemes, including overseas investments, benefit from an increased cap of €18,000 (mentioned in the official communication on economie.gouv.fr).
Warning: the exact calculation of the cap (and how the schemes interact) depends on your situation and the tax advantages used. For overseas investments, a specific mechanism exists (CGI art. 199 undecies D, commented in the BOFiP).
If your tax is insufficient: carry-forward (industrial Girardin)
The BOFiP doctrine specifies that when the amount of the tax reduction exceeds the tax due, the balance can be carried forward against income tax for the following years up to and including the fifth.
In practice: if you invest in 2026, you must size the arrangement so that the reduction can be offset against your expected tax. Any excess not used by the end of the carry-forward period is lost (no refund).
Risks & clawback: what to watch out for
Operating period not honoured
If the assets cease to be allocated to an eligible activity before the required term, the tax advantage may be clawed back.
Leasing arrangement & rebate
An insufficient or poorly documented rebate (rent/price) can cause problems. The cumulative conditions are detailed in the BOFiP.
Business sector / approval
Certain sectors are excluded and certain operations require approval. A mistake here is typically a deal-breaker.
In practice, risk management relies on: the soundness of the operator, the documentation (contracts, invoices, certificates), the guarantees (insurance, monitoring, contractual safeguards) and strict compliance with the BOFiP framework.
Checklist before investing (2026)
Taxation
- Your estimated tax due (and offset/carry-forward capacity)
- Check the €10,000 / €18,000 cap for your case
- Check the applicable rate in the BOFiP scale
Legal / structuring
- Territory, sector, eligibility, exclusions
- Compliant rebate (if leasing structure)
- Approval required? obtained? (if applicable)
Operation
- 5-year operating commitment (or normal period of use)
- Procedures in the event of damage/operation shutdown
- Complete documentation file (evidence, certificates)
Other investment solutions
As a complement or alternative to Girardin, other schemes can help you invest in property.
LMNP (non-professional furnished rental)
Furnished rental: tax advantages, tax regimes, conditions and obligations. Complete guide with official sources.
Serviced furnished rental
Professional furnished rental: definition, conditions, tax advantages, differences from LMNP, and obligations.
Bare ownership
Split-ownership property investment: definition, tax advantages, reduced purchase price, simplified management, and estate planning.
Unfurnished rental
Unfurnished rental: classic rental investment. Taxation, advantages, obligations and differences from furnished rental.
LLI (intermediate-rent housing)
Intermediate-rent housing: a rental investment scheme with VAT reduced to 10% and a tax credit. Conditions and tax advantages.
Denormandie
Denormandie scheme: a tax reduction for buying and renovating properties in certain areas.
Historic Monument
Investing in a Historic Monument: exceptional tax advantages for heritage restoration.
Disclaimer
The information in this article comes from the official sources referenced in the "Official sources" section at the bottom of the page. Handee cannot be held liable for any errors, omissions or interpretations of the information presented.
If in doubt, or for any question specific to your situation, please consult the official sources mentioned (Légifrance, BOFiP, impots.gouv.fr, Service-Public, economie.gouv.fr, etc.) or contact a qualified professional (tax advisor, notary, tax lawyer).
The exact rules applicable to your case depend on the type of investment (industrial/social housing), the territory, the structure (direct/leasing), compliance with the operating conditions and the texts in force. Eligibility conditions, scales and rules may change. Only the official sources are authoritative.