French Finance Law 2026: new tax measures for individuals

France's Finance Law for 2026 — loi n° 2026-103 du 19 février 2026 — was validated by the Constitutional Council on 19 February 2026 (decision n° 2026-901 DC) and came into force immediately. For individuals, the law contains four measures that deserve attention before the end of the calendar year: a +0.9% upward revision of the personal income tax (impôt sur le revenu, IR) bands, a temporary family gift exemption closing on 31 December 2026, a tightened timeline for the MaPrimeRénov' energy renovation grant scheme, and the creation of a new buy-to-let incentive called Relance logement.

This article focuses exclusively on measures affecting individuals and the private wealth sphere of business owners. For corporate measures — corporate tax (IS), the business value-added contribution (CVAE), the young innovative company (JEI) regime, and mandatory e-invoicing — please refer to our dedicated cluster articles at the end of this page.

In brief: the four major measures in loi de finances 2026 for individuals are the income tax band revaluation (+0.9% on 2025 income), the dons familiaux exemption window (up to €100,000 per donor, open until 31 December 2026), a revised MaPrimeRénov' grant calendar ahead of a complete restructuring in January 2027, and a new collective residential rental incentive scheme.

Under Article 4 of the Finance Law, French income tax bands applicable to 2025 income (declared in spring 2026) are indexed by +0.9% in line with inflation. This is not a structural reform — it prevents bracket creep from silently inflating the effective tax burden.

Supporting figures also increase: the family quotient (quotient familial) ceiling rises to €1,807 per half-share (from €1,791), and the single-parent ceiling to €4,262 (from €4,224). The individual décote (low-income rebate) becomes €1,982, and the couple décote €3,277.

For a non-resident or expat whose French-source income falls in band 3 — rental income from a French property, for instance — the revised thresholds produce a modest reduction in tax liability. For business owners who received an exceptional dividend or share sale proceeds in 2025, these updated ceilings are a relevant input when estimating the final tax bill.

Source: BOFiP ACTU-2026-00022.

Legal framework and purpose#

Article 790 A bis of the French Tax Code (Code général des impôts, CGI) — introduced by the law of 14 February 2025 — creates a temporary exemption from gift tax (droits de mutation à titre gratuit) for family cash gifts earmarked for housing purchase or energy renovation. The window runs from 15 February 2025 to 31 December 2026. There is no renewal provision in the current text.

Amounts and eligible recipients#

Each donor may give up to €100,000 per recipient free of French gift tax under this scheme. A single recipient can receive up to €300,000 in total by combining gifts from multiple donors. Eligible recipients are children, grandchildren, and great-grandchildren of the donor; in the absence of direct descendants, nephews and nieces qualify.

The funds must be deployed within six months of the gift for one of two uses:

• Purchase of a new-build or off-plan property (VEFA) as the recipient's principal residence
• Energy efficiency renovation works in the recipient's principal residence

Failure to meet the six-month deadline or the earmarking condition triggers reassessment of the exemption and the imposition of applicable gift tax.

Stacking with standard gift allowances#

This exemption stacks with two other standard CGI allowances, provided they have not been fully used in the preceding 15 years:

• Art. 790 G CGI: €31,865 manual gift allowance per donor-recipient pair
• Art. 779 CGI: €100,000 parent-to-child allowance

Non-cumulation rule: the same expenditure cannot simultaneously benefit from this exemption and from a state subsidy or tax credit (MaPrimeRénov', ANAH grant, energy transition tax credit). Where both a family gift and a renovation grant are involved, the eligible expenses must be separately allocated with documentation to support each claim.

A worked example#

A couple wishes to help their adult child purchase a new-build apartment. If neither parent has used their standard allowances in the previous 15 years, the following can be transmitted free of gift tax in a single operation:

Total transmissible free of gift tax: €463,730 — provided the property purchase completes within six months of the gift and constitutes the child's principal residence.

For business owners managing family wealth through a patrimonial holding structure, this mechanism creates a planning opportunity to align a structured transmission with the purchase or renovation project of a child — before the December 2026 deadline. A formal deed or duly registered manual gift declaration, with supporting proof of earmarking, is essential for audit-proofing the transaction.

The MaPrimeRénov' scheme undergoes its most significant structural change in several years. Property owners considering renovation works need to understand the precise calendar:

From 1 January 2026 — removed from the grant scheme:

• External and internal wall insulation (under the parcours par geste, or single-measure track)
• Biomass boilers (under the same single-measure track)

Until 31 December 2026 — still available:

• Parcours par geste (single renovation measures) for houses rated F or G under the energy performance certificate (DPE)
• DPE not yet mandatory in 2026: an energy class attestation suffices (full DPE will be required from 2027)
• Parcours accompagné (comprehensive renovation programme) restricted to properties rated E, F, or G; C and D-rated properties are now excluded

From 1 September 2026:

• No deep renovation grant (rénovation d'ampleur) where the household retains a gas heating system after the works

From 1 January 2027:

• End of the single-measure track for all properties
• Full DPE mandatory for all grant applications
• All grant applications must pass through the comprehensive renovation programme (rénovation d'ampleur)

For property owners considering individual measures — heat pumps, ventilation, roof insulation — the window closes on 31 December 2026. From January 2027, accessing public renovation grants will require a comprehensive project, significantly more demanding in terms of planning, eligible contractors, and documentation. Starting now avoids that constraint.

A practical risk to flag: combining a don familial under art. 790 A bis with a MaPrimeRénov' grant for the same works triggers the non-cumulation rule. We regularly see dossiers where the split between gift-funded and grant-funded expenditure has not been documented, which creates exposure on both sides during a later audit.

Relance logement: new buy-to-let incentive#

The LF 2026 introduces a rental investment incentive targeting new-build collective residential properties, with a nine-year letting commitment as a principal residence. The detailed rules — eligible zones, rent caps, rate of tax reduction — remain subject to implementing decrees not yet published as of this writing. Business owners with investable capital should monitor the publication of these decrees before committing.

Tax on patrimonial holding companies and luxury assets#

A new levy applies to luxury assets held for non-professional purposes: yachts, collection vehicles, racehorses, jewellery above defined thresholds. This measure specifically concerns high-net-worth individuals and business owners who hold such assets through private holding structures. If you hold this type of asset in a French holding or patrimonial structure, a review of the impact and available structuring options is warranted.

Levy on small parcels from outside the EU#

A €2 charge per article imported from outside the European Union is introduced to address competition distortions in e-commerce. This primarily affects individual consumers using direct-import platforms. It has limited direct fiscal significance for most business owners but may have supply-chain cost implications for structures sourcing goods from non-EU markets.

Charitable donation ceiling raised#

Since 14 October 2025, the 75% income tax reduction rate applies to donations up to €2,000 per year to qualifying organisations assisting people in need (up from €1,000 previously). For a taxpayer in the 41% band, the effective net cost of a €2,000 donation is €500 after tax — a relevant consideration for year-end planning.

The Finance Law 2026 contains equally significant measures for businesses and their owners — corporate tax (IS), CVAE, the JEI regime, and mandatory e-invoicing — which we have deliberately excluded from this article to maintain a clean focus on individual and private wealth matters. Our analysis of these measures is available in three dedicated articles:

• SME measures (IS, CVAE, JEI, e-invoicing): Finance Law 2026: key measures for SMEs
• Corporate and owner-manager measures: New tax measures 2026 for companies and their managers
• Flat tax / prélèvement forfaitaire unique (PFU): The Senate blocks the flat-tax increase: what changes

On the VAT small-business threshold (franchise en base de TVA): the proposal to lower the threshold to €25,000 was definitively abandoned by the law of 3 November 2025. The 2026 thresholds remain at €85,000 for sales and accommodation, and €37,500 for services.

The volume of a finance law is not the issue. The issue is identifying, within that volume, the two or three measures that are materially relevant to your situation and acting on the ones that carry a hard deadline.

Two deadlines dominate the individual landscape in 2026: 31 December 2026 for the dons familiaux exemption and the single-measure MaPrimeRénov' track. Both require lead time — a notarial deed, an eligible contractor, a grant application — that cannot be compressed into the final days of the year.

Up to date as of 26 May 2026. This article is for information purposes only and does not replace personalised professional advice. For your specific situation, please consult a registered expert-comptable.