Work carried out in a main residence may give rise to a tax credit. Only improvement works and fitting of specific equipment are concerned, but above all it is not necessary to be an owner to be entitled to it. Tenants and occupants free of charge can finance their work themselves, and reduce their taxes in exchange. The State has developed a scale specific to each type of work, with a ceiling.
What is a tax credit?
The tax credit is a direct rebate on income tax, the excess of which is carried over to the next few years. Suppose, for example, that a household has to pay $ 4,000 in taxes, but that it is entitled to a tax credit of $ 4,500. He will therefore not pay tax, and the remaining $ 500 may be reimbursed to him by the Public Treasury.
As part of a tax credit for carrying out work, the condition is only related to housing and not to people. This means that an occupying owner, lessor owner, tenant or even a person accommodated free of charge, can benefit from it.
As a reminder, tax rebates under tax exemption laws such as the Duflot or Censi-Bouvard law do not allow the balance to be carried over to the following year.
Tax credit for energy works
Energy saving works
The installation of energy-saving devices in a home gives entitlement to a tax credit. These can be installations of condensing boilers or heating control systems, as well as the addition of equipment using renewable energy.
To put it simply, those interested are invited to consult the list of works eligible for the ecological tax credit, on the Legifrance website.
Amount of the tax credit for energy savings
The amount of the tax credit for energy saving works is determined according to a percentage to be applied to the expenses incurred. This percentage increases when the interested parties carry out a bunch of work.
By work package, we mean the realization of 2 categories of work. In short, we invite you to consult the tax credit schedule and the list of work packages. As an indication, the rate ranges from 10% for the purchase of a condensing boiler to 32% for the purchase of a solar water heater.
For example, an expenditure of $ 2,000 for a system of hot water production with solar energy gives entitlement to a tax credit of $ 640. However, this same tax credit is subject to a ceiling.
Ceiling on the energy savings tax credit
Overall limit of the tax credit
Expenses cannot exceed a ceiling:
- $ 16,000 spent between January 1, 2005 and December 31, 2015, for a couple.
- $ 8,000 spent for a single person between January 1, 2005 and December 31, 2015.
In addition to the above ceilings, $ 400 is added per dependent. In the case of alternate custody, the ceiling is shared between the two parents, i.e. $ 200 per person.
Ceiling on the tax credit for equipment
When it comes to purchasing equipment, the maximum tax credit is as follows:
- 150 $ per square meter of external walls, insulated from the outside.
- $ 100 per square meter of external walls, insulated from the inside.
- $ 1000 per square meter for a solar water heater.
- $ 3,200 per kilowatt peak installed power for photovoltaic panels.
Get a tax credit for energy renovations
Speak to professionals
Those interested can carry out the work by themselves, or contact professionals. In any event, the tax credit relates to equipment, not to labor. It is important to obtain supplies from merchants registered in the commercial register, and providing a proper invoice.
In order to benefit from the tax credit, those interested must download a declaration of expenditures in favor of sustainable development, complete it and attach it to their annual income tax declaration.
Accessibility tax credit
To benefit from a tax credit, the work must be carried out in a principal residence. They must be dedicated to the acquisition of equipment specially designed for the elderly or disabled. Expenses related to the application of a Technological Risk Prevention Plan (PPRT) are included, as well as carrying out technical diagnoses.
To put it simply, those interested are invited to consult the list of works eligible for the tax credit for equipment dedicated to people with disabilities, on the Legifrance website.
Amount of the tax credit for fitting equipment
The amount of the tax credit obtained for fitting equipment in a home is calculated according to a rate applied to all of the expenses incurred. He’s from :
- 25% for equipment specially designed for the elderly or disabled.
- 40% for protection against technological risks.
For example, spending $ 4,000 on equipment for the disabled will give rise to a tax credit of $ 2,000. Again there are ceilings, as shown below.
Limit on the tax credit
The tax credit for fitting equipment specially designed for elderly or disabled people differs according to the situation of the persons concerned.
- $ 10,000 for a couple.
- 5000 $ for a single person.
In addition to the above ceiling, $ 400 is added per dependent child, or $ 200 if the children are in alternate care.
In addition, it should be noted that the tax credit expenditure limit during protection work against technological risks is:
- $ 20,000 per couple.
- $ 10,000 for a single person.
Obtain a tax credit for the purchase of equipment
To obtain the tax credit, the taxpayer must complete his tax return using the explanatory note.
Finance equipment installation
The tax credit for ecological works can be cumulated with an eco loan at zero rate. First-time buyers or investors can thus buy an old property, renovate it at zero rate up to $ 30,000 (maximum amount of eco PTZ +), while reducing their taxes.
This strategy is very popular with mortgage brokers because it helps reduce the borrower’s financial costs. Bankers are receptive to the use of all these tax systems, since the absence of interest increases the borrower’s ability to repay.