A parking lot does not depreciate like an apartment or a commercial space. The distinction between bare land and constructed work conditions all accounting treatment, and it is on this point that we observe the most errors in investors’ balance sheets.
Outdoor space or constructed box: the tax dividing line of a parking lot
The tax administration equates an outdoor parking space to land. As a result, it is non-depreciable. Only the constructed part (garage, covered parking, underground box) is eligible for depreciation based on its actual duration of use.
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This distinction applies regardless of the legal ownership regime. In a real estate investment company (SCI) subject to corporate tax as well as in an individual business under the actual regime, a simple ground marking on an asphalt slab does not constitute a construction in the sense of BOFiP. Foundations, walls, floors, and roofs characterize the depreciable building.
We recommend allocating the land share and the construction share from the moment of acquisition. Without this allocation, the administration can contest the depreciable base in its entirety. In practice, as detailed by the depreciation of a parking lot according to Encherimmo, the land fraction often represents a significant part of the price in dense urban areas.
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For structured parking (silos, underground of buildings), the land/construction distribution is based on an estimate consistent with the local land market. No unique regulatory coefficient is imposed, but the accountant must be able to justify the chosen method in case of an audit.
Accounting depreciation period of a garage or covered parking
The depreciation period reflects the actual duration of use, not an arbitrary flat rate. For a covered parking lot in reinforced concrete, this duration generally ranges from twenty to thirty years depending on the nature of the structure and the intensity of use.
Linear depreciation remains the standard method for constructions. Declining balance depreciation is not applicable to buildings. Each year, a constant fraction of the cost price excluding land is deducted.
Component approach
A constructed parking lot is not a homogeneous block. The component approach requires separating elements with different lifespans:
- The main structure (concrete structure, foundations): the longest duration, which sets the main basis for depreciation
- Technical equipment (automatic gates, charging stations, lighting, ventilation): significantly shorter duration, often between five and ten years
- Surface improvements (floor covering, marking, waterproofing): intermediate duration, renewed more frequently than the main structure
Each component has a separate depreciation plan. This decomposition increases deductible expenses in the early years, improving the net fiscal yield of the investment.
VAT on parking rental: the trap of the accessory
The rental of a standalone parking space is subject to VAT at 20%. This is a major difference from the unfurnished rental of housing, which is exempt from VAT. An investor who buys a garage to rent it separately therefore charges VAT to their tenant and can recover the VAT on the purchase price in return.
The exception concerns parking rented as an inseparable accessory to a dwelling: same landlord, same tenant, same real estate complex. In this case, the parking follows the housing regime and benefits from VAT exemption. However, this exemption also removes the right to deduct VAT on the acquisition.
We regularly observe errors when the parking and the housing are rented under separate leases or to different tenants. In these configurations, the parking loses its accessory character and becomes taxable for VAT.
Property income or BIC: the tax regime that conditions depreciation
For an individual landlord, rental income from parking lots falls under property income. The micro-property regime (30% allowance up to 15,000 euros of annual rent) or the actual regime (deduction of expenses: loan interest, works, property tax) applies. However, no depreciation is deductible in property income.
The situation changes radically with the LMNP status. A furnished or equipped parking space (charging station, storage locker) can shift into the BIC category. The actual BIC regime then allows for the depreciation of the asset, component by component, which reduces the taxable base without cash outflow.
SCI under corporate tax: full depreciation
In an SCI subject to corporate tax, the depreciation of the construction is deductible from the taxable result. The constructed parking enters the fixed assets and follows the classic rules of BIC/IS. The counterpart appears at resale: the capital gain is calculated on the net accounting value (purchase price minus depreciation taken), which increases the exit taxation.
- Property income (individual directly): no depreciation, deduction of current expenses under the actual regime
- LMNP under the actual regime: depreciation possible if the parking is equipped and rented furnished
- SCI under corporate tax: deductible depreciation, but professional capital gain upon sale
- Individual business or commercial company: depreciation according to classic BIC rules
Charging stations and equipment: an underestimated depreciation lever
The installation of electric charging stations in a business parking lot generates a distinct depreciable asset. The depreciation period for this equipment is short compared to the building, which accelerates the tax deduction.
For businesses, the LOM law imposes obligations for pre-equipment with charging stations during the construction or major renovation of parking lots. These works are recorded as assets and are subject to separate depreciation from the main structure.
Technical equipment often represents the most profitable depreciation item on a parking lot, precisely because their short lifespan concentrates the tax deduction in the early years of operation. A well-structured depreciation plan systematically integrates this decomposition from the acquisition.
The choice of tax regime and the quality of accounting allocation at the time of purchase determine the actual profitability of a parking investment. An outdoor non-depreciable space and a decomposed underground box by components do not produce the same net result after tax.