How to calculate depreciation in LMNP: complete guide

Depreciation in LMNP is one of the main reasons why the real tax regime can be so attractive for furnished-rental investors in France. It is also one of the most misunderstood topics. Many investors have heard that "you can depreciate the property" without really knowing:

• ▸what is depreciable and what is not;
• ▸how to split the purchase price;
• ▸what useful life to use;
• ▸how furniture, notary costs and works are treated;
• ▸and what changed with the 2025 Finance Act at the time of sale.

In 2026, it is no longer accurate to describe LMNP as we did in 2023 or 2024. Yes, depreciation remains powerful under the real regime. But for sales carried out from 15 February 2025, the tax treatment of capital gains has changed, which means previously deducted depreciation must now be integrated into the investor's exit analysis in relevant cases.

This guide explains how to calculate LMNP depreciation properly, what to depreciate, what not to depreciate, how to think about useful lives and how to integrate the 2025 reform into a real patrimonial strategy.

Depreciation mainly matters for furnished-rental investors taxed under the real BIC regime.

Micro-BIC versus real regime

Under micro-BIC, you benefit from a lump-sum allowance, but you do not deduct actual expenses and depreciation line by line.

Under the real regime, you may deduct:

• ▸actual expenses;
• ▸loan interest;
• ▸certain charges;
• ▸and depreciation.

Depreciation only makes sense under the real regime.

You do not depreciate the entire purchase price as one block.

Land is not depreciable

The land portion is never depreciable. You therefore need to split the overall price between:

• ▸land value;
• ▸building value.

What is depreciable

In practice, you may generally depreciate:

• ▸the building;
• ▸some components of the property;
• ▸furniture;
• ▸appliances;
• ▸certain improvements or fit-outs;
• ▸and, in some cases, capitalised acquisition costs depending on the chosen treatment.

The classic mistake

The most frequent mistake is to depreciate a global amount without separating:

• ▸building;
• ▸kitchen;
• ▸bathroom components;
• ▸furniture;
• ▸appliances;
• ▸works.

The more robust the file, the finer the allocation.

The depreciable base is not just the advertised purchase price.

1. Acquisition price

Start with the property purchase price.

2. Land / building split

Then remove the land portion. This allocation must be coherent and documented.

3. Acquisition costs

Notary costs, duties and ancillary acquisition costs may, depending on the chosen accounting treatment:

• ▸be expensed;
• ▸or be capitalised and depreciated.

This is a meaningful choice and should fit the overall tax strategy.

4. Works

You need to distinguish:

• ▸maintenance and repair works, which may often be deducted as expenses depending on their nature;
• ▸improvement or fit-out works, which may need to be capitalised and depreciated.

5. Furniture and equipment

Furniture, appliances and equipment often form a separate depreciable base with shorter useful lives than the building itself.

There is no single useful life for everything. The analysis depends on the nature of the asset.

Building

In practice, the building is often depreciated over a long period, frequently somewhere in a 25 to 40 year range depending on the property and the accounting approach.

Components

Some components may be depreciated over shorter periods than the core structure:

• ▸roof;
• ▸technical installations;
• ▸specific interior fit-outs;
• ▸dedicated improvements.

Furniture

Furniture and appliances are usually depreciated over shorter periods, often around 5 to 10 years depending on the asset.

Expert note

One of the most common mistakes is looking for the shortest possible life simply to maximise short-term tax savings. In LMNP, a credible depreciation policy is always safer than an artificially aggressive one.

The most common logic is straight-line depreciation.

Basic formula

For a given asset:

Depreciable base / useful life = annual depreciation

Simple example

Assume:

• ▸property purchase price: EUR 220,000;
• ▸land portion: EUR 20,000;
• ▸depreciable building value: EUR 200,000;
• ▸useful life for the building: 30 years.

Annual building depreciation:

• ▸EUR 200,000 / 30 = EUR 6,666.67

Now add:

• ▸furniture and appliances: EUR 12,000;
• ▸useful life: 7 years.

Annual furniture depreciation:

• ▸EUR 12,000 / 7 = EUR 1,714.29

Indicative total annual depreciation:

• ▸EUR 8,380.96

This is the rule many investors discover too late.

Under LMNP in the real regime, depreciation cannot create or increase a non-professional BIC loss. In practice:

• ▸actual expenses are deducted first;
• ▸depreciation comes after;
• ▸unused depreciation is not lost;
• ▸it is carried forward subject to the applicable rules.

This is why depreciation is powerful, but must always be modelled together with rents, interest, charges and expected profit.

This is the unavoidable point in 2026.

Depreciation added back on sale

Official tax guidance updated in 2026 confirms that, for sales made from 15 February 2025, depreciation previously deducted under the real BIC framework must now be considered in the capital-gain calculation in the relevant LMNP cases.

What this changes

Before, many investors thought in a very simple way:

• ▸depreciate during the holding period;
• ▸then sell under the private capital-gains framework without any real consequence from past depreciation.

That reasoning must now be updated. Depreciation remains useful, but it needs to be integrated into a broader patrimonial analysis:

• ▸holding period;
• ▸annual cash flow;
• ▸tax savings during operation;
• ▸exit impact.

Take Julie, who buys an apartment for non-professional furnished rental.

Starting data

• ▸acquisition price: EUR 250,000;
• ▸land portion: EUR 30,000;
• ▸depreciable building value: EUR 220,000;
• ▸capitalised furniture and equipment: EUR 18,000;
• ▸annual rents: EUR 13,200;
• ▸annual deductible charges excluding depreciation: EUR 4,500.

Depreciation assumptions

• ▸building over 30 years;
• ▸furniture and equipment over 7 years.

Calculation

Building depreciation:

• ▸EUR 220,000 / 30 = EUR 7,333.33

Furniture depreciation:

• ▸EUR 18,000 / 7 = EUR 2,571.43

Theoretical total:

• ▸EUR 9,904.76

Tax reading

Profit before depreciation:

• ▸rents: EUR 13,200;
• ▸charges excluding depreciation: EUR 4,500;
• ▸interim profit: EUR 8,700.

Because depreciation cannot create or deepen a loss, only the usable part is applied in the year, with the excess carried forward.

• ▸Depreciating the land.
• ▸Failing to separate building, furniture and works.
• ▸Choosing arbitrary useful lives.
• ▸Confusing deductible expenses with capitalised assets.
• ▸Forgetting the no-loss-creation rule.
• ▸Selling the real regime today using pre-2025 arguments.
• ▸Ignoring exit simulations.
• ▸Keeping weak accounting over several years.

Our role is not to produce a technical filing with no strategic view. We connect:

• ▸accounting;
• ▸annual tax;
• ▸depreciation logic;
• ▸and patrimonial strategy.

We help you:

• ▸split the acquisition price properly;
• ▸arbitrate between expensing and capitalising;
• ▸choose coherent useful lives;
• ▸calculate carried-forward depreciation;
• ▸simulate both holding and exit effects.

Would you like to model this strategy for your business? Book a personalised review with our team.

Calculating LMNP depreciation in 2026 requires a real method. The key takeaways are simple:

• ▸depreciation is available only under the real regime;
• ▸land is never depreciable;
• ▸building, furniture, some works and some costs must be analysed separately;
• ▸depreciation is calculated by asset category with coherent useful lives;
• ▸it cannot create or increase an LMNP loss;
• ▸and since the 2025 Finance Act, exit modelling must include the add-back effect at sale in the relevant cases.

Hayot Expertise, based in Paris 8, supports you end to end. Request your first complimentary discovery meeting to calculate your LMNP depreciation, secure your real-regime treatment and review your patrimonial strategy.

📞 01 48 48 24 14 | Book a meeting with our team