Overseas property owners in France and Switzerland should be looking for alternative ways to use their properties to avoid unnecessary tax charges and comply with new legislation, it is claimed.
Recent changes in Swiss and French property law might have an important impact on many second home owners in alpine resorts, according to Snow Swappers, a holiday swapping club for owners in ski resorts.
Earlier this year a Swiss referendum voted for a new law to restrict the number of second homes in each commune or municipality to no more than 20%. The reasoning behind the change is not to keep out foreign buyers, 60% of second home owners in Switzerland are Swiss nationals, but more about restricting the expansion of secondary residences in tourist locations, especially in the Alps.
There are over half a million second homes in Switzerland, equivalent to approximately 12 % of the overall housing stock and in the alpine cantons of Valais, Grison and Ticino the proportion of second homes is between 60 and 80%.
Owners of property in neighbouring France are facing changes in tax laws which will mean an increase from 20% to 35.5% in tax on rental income from applicable properties that is being back dated to January 01.
For owners from outside the European Union the situation is even worse, with tax rising to 48.8%.
There are also changes to Capital Gains Tax in France which means you must own a property for more than 30 years, as opposed to the previous 15, to be exempt from CGT.
Snow Swappers says that by arranging a swap with another property owner, owners could be skiing in Whistler, Verbier or Chamonix without paying anything for accommodation costs. And because there is no money changing hands, there's no tax deductible.
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