Definitions & key points: LMP vs LMNP
Furnished rental = BIC
Furnished rental income is taxed in the industrial and commercial profits (BIC) category. The "professional/non-professional" qualification does not prevent classification as BIC.
LMNP
You are a non-professional landlord if at least one of the LMP conditions is not met.
LMP
You are a professional landlord only if two cumulative conditions are met (see next section).
Key takeaway: moving to LMP mainly changes the logic of deficits, social contributions and capital gains.
LMP conditions 2026 (official criteria)
The activity is carried out on a professional basis when both of the following conditions are met:
| Condition | What the rule says (summary) | Practical point |
|---|---|---|
| 1) Income > €23,000 | The annual income from furnished rentals by all members of the tax household exceeds €23,000. | Assessed at the household level (all furnished rentals of the household). |
| 2) Income > other earned income | Furnished rental income exceeds the household's other earned income (salaries/pensions, other BIC, BNC, BA…). | Compared against the earned income listed by the administration (official detail). |
The professional/non-professional status is assessed at the tax household level and applies to all the household's furnished rentals.
Micro-BIC vs actual-expense regime: thresholds, allowances, obligations
A. "Micro" thresholds: pay attention to the type of rental
The micro thresholds depend on the type of rental (long-term, classified/unclassified tourist furnished rental…), and the rules have changed for some tourist rentals.
| Type of rental | Micro threshold (official figures) | Allowance (official figures) |
|---|---|---|
| "Classic" furnished rental (long-term) | €77,700 | 50% (minimum €305) |
| Guest rooms / classified tourist rentals | €188,700 | 71% (depending on the case) |
| Unclassified tourist rental (2025) | Below €15,000 | 30% micro allowance |
| Classified tourist rental (2025) | Up to €77,700 | 50% micro allowance |
B. Actual-expense regime: rationale and obligations
Under the actual-expense regime, you declare a result (profit/deficit) via a BIC return package (notably form 2031), in liaison with the business tax office (SIE).
- Deduction of actual expenses (per the tax rules) instead of a flat-rate allowance.
- Stricter filing obligations (form 2031 and appendices via the professional account / SIE, as applicable).
- In practice, many landlords switch to the actual regime when micro becomes less favorable (works, interest, depreciation…).
Filing: impots.gouv distinguishes between the LMNP and LMP sections (dedicated boxes) under both micro and actual regimes.
Deficits: LMP vs LMNP (the major difference)
| Topic | LMNP (official guideline) | LMP (official guideline) |
|---|---|---|
| Offsetting of deficits | Deficits can be carried forward against non-professional furnished rental income (carried forward over 10 years). | Deficits deductible from overall income without any limit on the amount (if overall income is insufficient: possible carry-forward over several years). |
This is one of the main reasons LMP status is sought after… but it comes with constraints (social contributions, accounting follow-up, etc.).
Capital gains: LMP rules + possible exemptions
Under LMP, the sale may fall under the professional capital gains regime if the building is recorded as a business asset.
A. "Professional" regime (principle)
The BOFiP recalls the application of the professional capital gains regime (short term / long term) under the relevant articles.
- The qualification and procedures depend notably on recording as a business asset, the holding period and the nature of the depreciable items.
- To be compared with the individuals' regime (LMNP), which benefits from holding-period allowances (Service-Public reminder).
B. Possible exemptions (subject to conditions)
Service-Public "Entreprendre" details capital gains exemptions (notably based on the income level and a minimum period of activity).
- Full exemption if income < €90,000 excl. VAT (over the 2 years preceding the sale) + activity started at least 5 years earlier; partial between €90,000 and €126,000 excl. VAT.
- The full details depend on the applicable schemes (and your situation): to be validated with a professional (notary / chartered accountant).
In 2026, to "sell cleanly" under LMP, it is important to plan ahead: asset recording, depreciation, and any exemption scheme. Get the figures before signing a sale agreement.
Practical obligations: SIRET, CFE, VAT (as applicable)
The impots.gouv "furnished rental" page recalls that, professional or not, you must complete certain formalities (SIRET) and are liable for the CFE; depending on the situation, VAT and other contributions may apply.
| Obligation | Who is concerned? | Key takeaway |
|---|---|---|
| SIRET number / formalities | LMNP & LMP | Often necessary to declare the activity correctly (one-stop business portal as applicable). |
| CFE | LMNP & LMP | Furnished rental can trigger the CFE (rules depending on the situation). |
| VAT | Depending on services / situation | VAT depends on the case (e.g. hotel-like services). The administration refers to a dedicated section. |
Checklist before getting started (2026)
1) LMP qualification
- Income > €23,000?
- Income > other earned income?
- Calculated at the tax household level
Reference: impots.gouv + BOFiP.
2) Choice of regime (micro / actual)
- Type of rental (classified / unclassified tourist / long-term)
- Applicable micro thresholds and allowances
- If actual: accounting organization (form 2031, SIE…)
Reference: impots.gouv (furnished rental + tourism FAQ).
3) Social & resale
- Possible social contributions above certain thresholds
- Deficits (LMP vs LMNP)
- Capital gains: professional regime + possible exemptions
Reference: Service-Public + BOFiP.
Other investment solutions
As a complement or an alternative to LMP, other schemes can help you invest in real estate.
LMNP (non-professional furnished rental)
Furnished rental: tax advantages, tax regimes, conditions and obligations. Complete guide with official sources.
Bare ownership
Split-ownership real estate investment: definition, tax advantages, reduced purchase price, simplified management, and estate planning optimization.
Unfurnished rental
Unfurnished rental: the classic buy-to-let investment. Taxation, advantages, obligations and differences with furnished rental.
LLI (intermediate-rent housing)
Intermediate-rent housing: a buy-to-let scheme with 10% reduced VAT and a tax credit. Conditions and tax advantages.
Girardin
Girardin scheme: investing in the French overseas territories with a tax reduction. 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, we invite you to consult the official sources mentioned directly (impots.gouv.fr, Service-Public.fr, BOFiP, etc.) or to contact a qualified professional (chartered accountant, tax advisor, notary).
The exact rules applicable to your case depend on the type of rental (long-term/tourist, classified/unclassified), the income level and the structure (asset recording, etc.). Eligibility conditions, scales and rules may change. Only the official sources are authoritative.
Social contributions: when and how?
Service-Public specifies that, for social contributions, you are considered a "professional landlord" if annual income exceeds €23,000 (apart from exceptions, e.g. guest rooms).
What it changes in practice
Point to watch (2026)
The social security rules do not always match the tax rules (LMP/LMNP), especially for short-term rentals. To be safe, rely on the Service-Public "social contributions" grid and the one-stop business portal.