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The Demessine scheme allowed investors in French rental to enjoy a tax benefit spread over 6 years. Back on this law Demessine, repealed at the end of 2010.

What is the Demessine device?

The Demessine scheme concerned rental investment, namely investment in tourist residences located in Rural Revitalization Zone (ZRR) with sublease to the managing company of the tourist residence, or services, for a period of 9 years minimum. This investment allowed purchasers to benefit from a tax benefit: a tax exemption spread over 6 years.
They also benefited from temporary entitlement of up to 8 weeks per year, without jeopardizing the tax benefit.

The Demessine scheme was introduced by the 1999 Finance Act, and was repealed on December 31, 2010.

What was the tax advantage of the Demessine law?

The tax benefit was a reduction in the property tax spread over 6 years at 25% of the investment amount, in the limit of 50 000 € for a single person and 100 000 € for a married couple.

The tax benefit therefore amounted to:

  • € 12,500 for 6 years or € 2,083 per year for a single person with an investment of € 50,000
  • 25 000 € for 6 years or 4 166 € per year for a married couple with an investment of 100 000 €

What were the conditions to benefit from it?

To benefit from the Demessine scheme, the housing and the beneficiary had to group a number of conditions:

  • Housing: it must have been a new dwelling (or off-plan sale) located in a tourist or service residence in a Rural Revitalization Zone (RZA) or in a rural area that met the Objectives 2 of the European Structural Funds.
  • The investor: the device concerned all natural persons who had made a real estate investment in the rental.

Other condition: the investor had to make a commitment to keep and rent the bare house whose management was entrusted to a company that operates the residence (tourism or services company) for a minimum duration 9 years old.

-> The Demessinea law was repealed on December 31, 2010.

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