For many, owning a chateau is the fulfillment of a lifelong dream, yet behind the stone walls and turrets lie restoration costs that can be as daunting as the edifice itself.
Fortunately, there is an array of financial aids and tax incentives to encourage the preservation of these architectural treasures.
Loi Malraux 2014
The principal form of assistance is through the Loi Malraux, which was established to preserve historic buildings in protected areas.
The scheme allows owners to benefit from a significant income tax reduction in exchange for restoration work. Complete restoration is normally a condition of the assistance.
Depending on the classification of the area, the tax deduction ranges from 22% to 30%, subject to an annual limit of €100,000 and a maximum of €400,000 over 4 years.
It is also possible to combine Malraux with other aids, but grants are deducted from the amount eligible for the tax reduction.
DRAC
Alongside Malraux are grants available from the Ministry of Culture (Direction Régionale des Affaires Culturelles (DRAC). Such grants are only available for listed or registered historic buildings (Monuments Historiques), but even if the property is not classified getting a rating is demanding but not impossible.
For properties that are merely ‘registered’ the grant is up to 40% of the work; for those that are classed it is up to 50%. The total of public grants cannot exceed 80% of the total cost of the work.
Once again, as with Malraux, obtaining the grant requires strict adherence to the rules of restoration to the original state.
You need to contact the service Conservation Régionale des Monuments Historiques (CRMH) at the DRAC.
Loi Monuments Historiques
The Loi Monuments Historiques 1913 offers up to 100% of restoration and maintenance costs, as well as loan costs, to be deducted from global or rental income (revenus fonciers), subject to conditions of public access or rental. There is no obligation of rental but in such cases the tax advantage is reduced to 50%. It’s a scheme that is therefore highly advantageous to those on a high marginal rate of income tax.
It is also possible that the property can obtain exemption from inheritance tax, provided the heirs decide to retain ownership of the property for at least 15 years.
There is an obligation of residency to obtain assistance and the owner must commit to keeping the property for at least 15 years.
Although listing is normally necessary, if the property is visible from the public highway, a rating by the Fondation de Patrimoine may suffice.
To obtain assistance you need to contact your regional office of the DRAC.
“This scheme is one of the most advantageous for owners of listed chateau,” notes a chartered accountant speaking in Belles Demeures.
Local Councils
There may also be financial assistance available from one of the local councils - either commune, department or region.
Each council and territory has its own criteria and budgets. It is therefore essential to inquire directly with the relevant services.
Fondation du Patrimoine
Another major actor is the Fondation du Patrimoine, a charitable organisation that is playing an increasingly important role in the preservation of older buildings.
There is no requirement that the property be located in a protected area to obtain assistance, and the level of support will depend on the nature of the project. Once again, a deduction against income tax is possible.
As with all the agencies in the process, there is a generous level of technical support that is available from the Fondation.
You can contact them at Fondation du Patrimoine.
ANAH
Finally, there are also grants and loans available through the more general schemes of financial assistance towards energy conservation, operated by the national housing agency ANAH. A test of resources applies to such assistance. You can read about such schemes at Financial Assistance for Home Energy Efficiency Grants.
Patience!
Not surprisingly, with all these schemes there is a substantial degree of administrative complexity and of supervision by the authorities. As a result, the processing times are long, often due to the need to consult and obtain the approval of several agencies.
There is also generally a requirement to restore the property to its original state, using traditional materials and techniques, as well as specialist professionals, which will add to costs and delays. The net financial benefit is therefore likely to be lower than the relief itself.
Nevertheless, there is a wealth of support available to those prepared to go on this journey, and a substantial financial benefit to those who can accomplish it.
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