Malraux: tax reduction of 22 or 30% (%) and spending cap

The basic rate for the Malraux tax reduction is 22%. This increases to 30% for buildings located within a protected wealth site covered by an approved preservation and enhancement plan (PSMV). The texts also stipulated 30% in certain deteriorated neighborhoods, but only for expenses paid or incurred by December 31, 2024 at the latest: this deadline has passed. Restoration expenses are eligible up to a limit of €400,000 over a period of four consecutive years. In return, you commit to renting the property unfurnished for nine years.

This page does not cover four points: the boxes in the income tax return, the situation of non-residents, joint ownership and the order of allocation between several tax reductions.

What rate for which building?

For these two types of neighborhoods, the BOFiP (version of 07/03/2024) and impots.gouv.fr (page modified on 08/04/2026) consider expenses up to December 31, 2024. We have not seen any extension beyond this date. Therefore, the 30% % rate in disadvantaged neighborhoods should not be assumed for recent expenses: verify it with the BOFiP and Légifrance before making any commitment.

The descriptions of these neighborhoods vary depending on the source. The impots.gouv.fr website refers to them as NPNRU neighborhoods. The BOFiP (Official Bulletin of Public Finances) describes a neighborhood with a high concentration of dilapidated older housing, subject to a multi-year agreement. We are not determining their equivalence: please use the exact description and have the address classification verified.

For a remarkable wealth site, the building permit application or prior declaration must have been filed on or after July 9, 2016. The building must in principle be the subject of a restoration declared to be of public utility, unless it is located in a site covered by an approved PSMV or PVAP.

The €400,000 limit

Eligible expenses are capped at €400,000 over a total period of four consecutive years (permit applications or prior declarations filed from January 1, 2017).

The portion of expenses that exceeds the ceiling cannot be carried forward or deducted for the determination of property income.

The calculation is simple: eligible expenses × rate. With €400,000 of eligible expenses, the reduction is €88,000 for 22 % and €120,000 for 30 %.

If the reduction exceeds your tax

The Malraux tax reduction is a tax reduction. It is applied only to income tax calculated using the progressive tax scale, and not to the flat-rate tax. The French tax authorities (BOFiP) state that tax reductions are non-refundable: any excess is not reimbursed.

For Malraux, the law provides for a carry-forward. If the portion of the tax reduction attributable to a given year exceeds the tax due, the balance can be applied to the income tax due for the following three years. Any amount that could not be applied by the end of this period is not refunded.

Malraux has been excluded from the overall cap on tax benefits since the taxation of 2013 income.

Rental conditions

The owner agrees to rent out the property for a minimum period of nine years. The following conditions apply:

• Bare rental, for use as the tenant's main residence.
• Available for rent within twelve months which follow the date of completion of the works.
• Tenant : a natural person other than the owner himself, a member of his tax household, an ascendant or a descendant.
• Eligible premises : premises used for residential purposes and, for applications submitted from 1 January 2017 onwards, premises converted into housing.

If the property is not re-let within twelve months of receiving the notice to vacate, the tax reduction obtained will be revoked (BOFiP BOI-IR-RICI-200-20). Failure by the tenant to comply with the allocation requirement may also affect the reduction: check the BOFiP text specific to your situation.

Numerical example (fictitious profile)

Situation. Sophie and Marc form a tax household subject to the progressive tax scale. Assuming their profile: their income tax is €25,000 each year, without any other reductions or credits. They pay €450,000 for restoration work in the same year, on a building located in a remarkable wealth site covered by an approved PSMV (rate of 30 %).

Issue. What discount do they get, and can the entire amount be used?

Strategy. Apply the €400,000 cap, calculate the reduction, then deduct it from the tax for the current year and the following three years. Compare with the same project at 22 %.

Result.

At 30 %, the tax reduction (€120,000) exceeds the household's tax credit capacity over four years (€100,000). The remaining €20,000 is not refunded. Therefore, the highest tax rate does not necessarily mean the reduction is fully utilized: what matters is the ratio between the reduction and the tax the household pays over the period.

This profile is fictitious. The tax amount is a hypothetical scenario, assumed to be the same each year. The calculation ignores other reductions, tax credits, tax discounts, and income changes. It illustrates a mechanism, not a prediction of your specific situation.

What changes depending on your situation

• The exact location of the building : it sets the rate and conditions specific to the sector, and the date of expenditure counts for degraded neighborhoods.
• The spending schedule : the ceiling covers four consecutive years.
• Your income tax : it determines the portion of the reduction that you can allocate, and over what period.
• The nature of your income : the reduction is applied to the tax calculated according to the progressive scale.
• The rental commitment : the tenant, the purpose of the accommodation and the rental period are regulated.
• Your resident or non-resident status This page does not address it.

The rule depends on your situation. No results are guaranteed.