The Real Estate Civil Society (SCI) is a legal structure that allows several people, whether they are from the same family or not hold and manage property jointly property. This type of company offers partners many benefits such as ease of administration, asset protection, simplified transfer and tax benefits. In this article, we invite you to discover the benefits of SCI in detail.
Ease of administration and flexibility
Creating an SCI allows you to benefit from great flexibility in property management. It offers the possibility of organizing the operating schedule according to the wishes of the partners. For example, they can freely decide on the methods of decision-making, the distribution of profits and losses or even the terms of the transfer. social actions.
Moreover, unlike other legal structures, the creation of an SCI does not require many administrative formalities. Simply write bylaws in a relatively simple way and register them with the Chamber of Commerce and Industry to obtain registration in the trade and business register.
Protection of personal and family property
One of the main advantages of SCI is protection of partners’ personal propertyespecially in case of financial difficulties. This is because creditors of the partners cannot seize or sell real estate held by the SCI to collect their debts, because this property belongs to the company and not to the partners personally.
SCI is also an interesting tool for ensuring the protection of family assets. Indeed, the transfer of real estate under SCI makes it possible to avoid the legal and tax consequences associated with inheritance and to foresee a more progressive and less expensive transfer of property to the heirs.
Simplified property transfer
PUSH SCI greatly facilitates the transfer of assets real estate while avoiding certain legal and tax restrictions. For example, it is not necessary to carry out a material division of the property between the heirs, which can lead to family disputes or even significant costs. Heirs simply receive shares proportional to their rights and can freely transfer their shares or retain their participation in the management of the company.
At the tax level, transfer of real estate through SCI makes it possible to optimize inheritance and gift taxes. This is because social shares generally benefit from milder taxation than that applicable to real estate, including tax breaks and discounts depending on the age of the donors and the value of the transferred shares.
Tax benefits and optimization possibilities
Tax on rental income
Depending on the chosen tax regime, SCI allows you to benefit tax benefit of rental income from realized real estate. For example, if the SCI is subject to income tax (IR), the partners can deduct certain expenses associated with the management and maintenance of the property, such as works, running costs or even interest. These tax credits thus make it possible to reduce the tax base on rental income and reduce the tax payable.
If the SCI is subject to corporation tax (IS), the rental income is also taxed on a progressive scale, but at lower rates than those applicable to IRs for higher groups. Therefore, this option can be interesting for partners with significant income.
Real estate capital gains
In an SCI subject to IR, capital gains realized on the sale of real estate are generally taxed in the same way as individual capital gains, with a reduction for the period of holding and possibly full exemption at the end of 22 years. . This allows the partners to benefit from taxation that is not too high if they have kept the property for a certain period of time.
In the case of an SCI subject to IS, capital gains from real estate are taxed at a specific rate, which may be lower than the rate applicable to individuals. This difference in rates can allow for tax savings when transferring assets.
VAT refund from the work
Finally, the creation of an SCI can also allow VAT refunds for works carried out on company-owned buildings. This can represent a significant saving for partners, especially if the properties require significant renovation or development.
To wrap it up
Therefore, creating an SCI has several advantages for people who want to invest in real estate together: easy management, protection of personal and family assets, simplified transfer of assets and tax optimization. However, it is advisable to carefully study the methods of setting up and operating this legal structure, as well as the tax and financial implications associated with the choice of the applicable tax regime.