The depreciation in LMNP under the real regime allows for the accounting deduction of the loss of value of a property and its furnishings, year after year, to reduce the taxable income. This mechanism relies on a precise breakdown of the property into several components, each depreciated over its own duration. The central question for any investor remains to measure the actual tax difference between the micro-BIC regime and the real regime with depreciation.
Share of the land and depreciable base: the calculation that few investors refine
The land on which a property sits is never depreciable. This often-cited rule is rarely accompanied by its practical corollary: the share of the land to be isolated varies according to the location.
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In densely urban areas, this share generally ranges between 10% and 20% of the total value of the property. The more expensive the land in the area, the higher the share of the land increases, and the lower the depreciable base decreases. An apartment in the city center of a large metropolis will have a higher land share than a property in the suburban area.
The depreciation of the property in LMNP therefore relies solely on the value of the building, to which the furniture and renovations are added. This breakdown must be included in the accounting, with a breakdown by component.
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| Component | Current depreciation duration | Share in the value of the property |
|---|---|---|
| Structural work | 25 to 40 years | Majority |
| Roof | 20 to 25 years | Variable depending on the type of property |
| Electrical / plumbing installations | 15 to 20 years | Some percentage |
| Furniture (furnishings, appliances) | 5 to 10 years | Variable, often a few thousand euros |
| Renovation work | About 10 years | Depending on the nature of the work |
| Land | Non-depreciable | 10% to 20% depending on the location |
Unlimited carryforward of unused depreciations: an underestimated tax lever
LMNP depreciation can never create a tax deficit. The annual deduction is capped at the amount of rents minus other charges. If the charges (loan interest, insurance, management, property tax) already absorb all rental income, the depreciation for the year will not be lost.
The unused portion carries forward to the following years, with no time limit. This mechanism explains why investors with high charges in the early years (loan repayment, renovations) accumulate a stock of carryforward depreciations that continues to produce a tax effect long after the loan ends.
In practice, a property purchased on credit with high loan interest generates little taxable income at first, thanks to deductible charges. The depreciation calculated each year adds to the carryforward stock. As the interest decreases over time, the stock of depreciations takes over and maintains a low or even zero taxable income.
Real regime with depreciation versus micro-BIC: the actual tax difference
The micro-BIC regime grants a flat-rate allowance of 50% on declared rents. The real regime allows for the deduction of actual charges and accounting depreciation. The difference between the two depends on the amount of charges and the depreciable value of the property.
- An old property with significant renovations and an ongoing loan almost always benefits more from the real regime: the combined deductible charges and depreciation far exceed the 50% allowance.
- A new property purchased outright, without renovations, with few charges, can sometimes make the micro-BIC competitive, as the only depreciations may not always exceed the flat rate.
- The furniture, depreciated over 5 to 10 years, contributes significantly in the early years but then disappears from the calculation, which can alter the balance in the medium term.
The choice between the two regimes is therefore measured to the nearest euro, by simulating actual charges over several years. The real regime remains more advantageous in the vast majority of cases, but this majority is not an absolute generality.
Accounting obligation of the real regime
The real regime requires maintaining compliant accounting, with a balance sheet, an income statement, and a depreciation table by component. This obligation generates an annual cost (accountant or specialized management solution) that must be included in the comparison with the micro-BIC.
Reintegration of depreciations upon resale: what the 2025 reform changes
Until 2025, depreciations deducted in LMNP were not reintegrated into the calculation of the capital gain upon resale. The personal capital gains regime applied based on the acquisition price, without any increase related to the depreciations practiced.
The finance law for 2025 modified this rule for transfers occurring from its entry into force. The deducted depreciations now reduce the acquisition price, which mechanically increases the taxable capital gain.
A ministerial response on March 24, 2026, clarified a decisive point: the reintegration targets all depreciations since acquisition, including those applied before 2025. For an investor who has depreciated their property for ten or fifteen years, the impact on the calculation of the capital gain can be substantial.
This modification does not eliminate the interest of depreciation, but it changes the overall equation. The annual tax advantage must be weighed against the potential tax cost at resale. The longer the holding period, the more the allowances for holding period mitigate the impact, without completely neutralizing it.
LMNP depreciation under the real regime remains a powerful mechanism for reducing taxation on rental income, provided one masters the breakdown of the property, the share of land, and the stock of carryforward depreciations. Since 2025, the calculation can no longer stop at annual operations: the taxation of resale is an integral part of the analysis.