In 2025, the tax regulations surrounding short-term furnished rentals have seen significant developments, especially concerning the application of VAT. These changes can impact both profitability and the administrative burden for property owners. Here’s a summary of the key information to know.

In principle, furnished short-term rentals are exempt from VAT. However, if the owner offers at least three of the following four hotel-style services, the rental becomes subject to VAT:

1. Provision of breakfast
2. Regular cleaning of the premises
3. Provision of bed linen
4. Reception of guests, even if not in person

Recent clarifications have been made about these services. For example, for stays of less than a week, cleaning done before guests arrive is now considered regular cleaning. Similarly, providing bed linen at check-in is classified as a hotel service.

Initially, the 2025 finance bill proposed reducing the VAT exemption threshold to €25,000. However, this reform has been postponed until 2026. For 2025, the current VAT thresholds remain:

• €85,000 base threshold
• €93,500 increased threshold

This means that even if your activity qualifies as hotel-style, you will not be liable for VAT as long as your annual revenue stays below these thresholds.

Although the VAT reform is on hold for 2025, it could take effect in 2026. If so, your 2025 revenue will be used as the basis to determine VAT liability starting in January 2026.

It’s therefore crucial to monitor legislation closely and adjust your strategy accordingly.

For 2025, most short-term rental owners are not affected by VAT, as long as they don’t offer hotel-style services and remain below the VAT thresholds. That said, staying informed and prepared for future changes is key.

We’re here to help.

Marc Cassina
Founder of CasaBooking

Sources and References:

• MaFormationImmo.fr – “TVA : la franchise maintenue, le nouveau seuil reporté à 2026”
• SelogerNeuf – “LMNP: Key changes expected in 2025”
• Investissement.compta.com – “VAT reform postponed to 2026”
• Nopillo – https://www.nopillo.com/