France-Tunisia Tax Treaty: How It Affects TRE Rental Property Owners

The France-Tunisia double tax treaty (signed 28 May 1973, amended by successive protocols) governs which country has the right to tax income when individuals have links with both countries.

Disclaimer: This guide is educational. Individual situations may have specific complexities. Consult a qualified tax adviser before filing.

Key Principle: Where Is Rental Income Taxed?

Under Article 6 of the convention, income from immovable property is taxable in the state where the property is located — i.e., Tunisia.

If you are a French tax resident (living and working in France) renting out an apartment in Tunis, that rental income is taxable in Tunisia.

French Declaration Obligations

The treaty does not eliminate French declaration requirements. Tunisian-source income must be declared in France but benefits from an exemption with progressivity mechanism:

• Tunisian rental income is exempt from French income tax but is taken into account when calculating the rate applied to other French income.

In practice: declare your Tunisian rents in the French tax return in the box for exempt foreign income subject to effective rate calculation.

Taxation in Tunisia

As a Tunisian non-resident receiving rental income from Tunisia:

• Subject to Tunisian personal income tax on Tunisian real estate income
• Progressive rate: 0–35%
• 30% flat deduction on gross income
• Annual declaration required to the Tunisian tax authority (DGI)

Capital Gains

Capital gains on Tunisian property sold by a French tax resident are in principle taxable in Tunisia (state of property location). The gains must also be declared in France for progressivity purposes.

Practical Checklist for Franco-Tunisian Landlords (TRE)

1. Declare rents annually to the Tunisian DGI
2. Appoint a tax representative in Tunisia if non-resident
3. Declare in France in the exempt foreign income section
4. Keep proof of Tunisian tax payment for French tax authority
5. Consult a tax adviser before selling for capital gains optimisation

Sources: France-Tunisia Tax Treaty 28 May 1973, French CGI, Tunisian DGI.