Money transfers to France to cover tax costs?

International money transfers to France could be on the cards for overseas property owners keen to keep down their costs.

According to Stuart Law, chief executive of Assetz International, the new tax on second homes in France is likely to add around €300 to yearly outgoings.

Speaking to Overseas Property Professional, Mr Law added that this cost is on top of average annual service charges of €1,500 for a city centre apartment and around €600 in council taxes.

Combined, these costs are going to place some pressure on the finances of people who own second homes in France.

Using an international money transfer service to send euros to France will help to keep down the costs, especially when the foreign exchange rate for sterling is so poor.

This afternoon (June 15th) sterling was trading against the euro at €1.135 at 14:30 BST.

The foreign exchange follows a general downwards trend for the pound, after peaking at around €1.22 in June 2010.

However, Mr Law noted that the additional costs are unlikely to put people off purchasing property in France.

He said: "France has always been one of the most popular destinations for second home owners from the UK because of its close proximity and appealing culture.

"Second home owners in France already pay taxes for local services and this new cost may be viewed by less wealthy homeowners as an additional burden, meaning they have less money to spend in shops, restaurants and local attractions when they visit."

The property expert explained that the tax is designed to compensate for holiday home owners who rent their houses without declaring the income and paying tax.

It is hoped that this will encourage them to register their holiday rental business and avoid paying the new fee.

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Posted by Chris Barber