In brief
Many buyers of a family home or holiday home in France buy in their own names, alone or jointly. A société civile immobilière (SCI) is a French civil company, with at least two partners, that owns the property while the family owns the company's shares. It can make joint ownership and gradual transfer to children easier to organise. Against that, it costs money to set up and run. It must keep accounts and file returns. If it lets the home furnished or opts for corporation tax it can lose the favourable capital gains treatment that private owners enjoy. The choice depends on your family, your country of residence and your plans for the home. It should be made with a notaire or tax adviser before you sign the preliminary contract.
This guide is general information, not legal or tax advice.
The two routes compared
| Point | Own name | SCI taxed as a partnership (default) |
|---|---|---|
| Who owns the house | You, alone or jointly with others | The company; you own shares |
| Set-up | None beyond the purchase | Articles of association, registration, a manager, a bank account |
| Running duties | None beyond your own tax returns | Accounts, minutes of decisions, an annual return (form 2072) before early May |
| Tax on rent | In your own name | In each partner's name, in proportion to their shares |
| Tax on a gain on sale | Private gains regime with taper relief | The same private regime, applied to each partner |
| Furnished letting | Allowed | Only as an accessory activity; beyond 10% of turnover the SCI becomes liable to corporation tax |
| Transfer to children | Gift or inheritance of the property | Gifts of shares over time, within the articles' rules |
| Selling | Sale of the property | Sale of the property or of the shares |
| Duty on a sale of shares | Not applicable | 5% of the price for a company mainly holding property |
How an SCI works
- Partners. At least two, who may be individuals or companies. Spouses can form an SCI together whatever their matrimonial regime.
- Capital. Set freely, from €1. The property is usually bought by the SCI with money lent by the partners or borrowed from a bank.
- Liability. Partners are liable for the company's debts without limit, in proportion to their share of capital, but creditors must first pursue the company.
- Articles. The articles of association set how decisions are taken, who may become a partner and how shares may be transferred. This flexibility is the main reason to use an SCI. It is also where badly drafted articles cause problems later.
- Manager. One or more managers, who may be partners or third parties, run the company within the powers the articles give them.
- Records. The manager keeps accounts and reports to the partners at least once a year. Every decision is recorded in minutes.
Tax: partnership or corporation tax
By default an SCI is transparent for tax. Its income is taxed in the partners' names whether or not it is distributed. A gain on sale follows the private regime: 19% income tax and social charges, with taper relief that removes income tax after 22 years and social charges after 30 (see French property taxes).
An SCI can opt for corporation tax, at 25% with a 15% rate on the first €42,500 of profit under conditions. The option can be revoked until the fifth financial year after it is made. After that it is permanent. Under corporation tax the company can depreciate the building, which lowers taxable profit while it lets the property, but there is no taper relief: the gain on sale is calculated on the depreciated book value. Profits paid out to the partners are taxed again. For a family home kept for the long term, corporation tax is rarely the better choice. For a property let commercially it can be; the decision needs proper modelling.
Furnished letting is a commercial activity. An SCI may carry it on only as an accessory; if furnished rent exceeds 10% of turnover excluding VAT, the tax administration treats the SCI as liable to corporation tax, with immediate tax on profits and gains not yet taxed. Holiday letting of the villa through the SCI therefore needs care; see holiday letting rules.
Other points for international buyers
| Point | What to know |
|---|---|
| Wealth tax (IFI) | Shares are taxed on the value that represents French property, less the company's related debts. A non-resident is liable only if the net French property exceeds €1.3 million. |
| Annual 3% tax | Companies that hold French property owe an annual tax of 3% of its market value unless an exemption applies. An SCI with its seat in France, the EU or a treaty country can be exempt by filing an annual declaration of the property and of its partners by 15 May. Your adviser should confirm the exemption each year. |
| Transfer duties at purchase | The SCI pays the same duties as any buyer: a departmental rate of 4.50% in the Alpes-Maritimes and 5.00% in the Var on a resale (see buying costs in France). |
| Selling the shares | Duty of 5% on the price of shares in a company mainly holding property. Since 27 June 2026 the act of transfer must be a notarial deed, a deed countersigned by an avocat or, in certain cases, a deed drawn up by an accountant. Otherwise it is void. |
| Succession | An SCI can help organise who inherits what, but it does not take French property outside French tax. Choice of law and reserved heirship are explained in inheritance and French property. |
| Your own country | Your home country may treat a French SCI as transparent or as a company. Ask a tax adviser there before you buy. |
When each route tends to suit
- Own name suits a couple or single buyer purchasing a family or holiday home for their own use, with no plan to let it furnished. It is simple and cheap and keeps the private capital gains regime.
- An SCI can suit several families or generations buying together, buyers who want to pass shares to children over time and owners who want rules on what happens if one partner wants to leave. It works best when the home is used by the family or let unfurnished.
- A company of your own country buying French property raises its own questions, including the 3% tax and the tax position at home. Take advice in both countries before you commit.
Whatever you choose, the decision must be made before the preliminary contract, because the buyer named in it is the buyer at completion unless the contract allows a substitution. Your notaire can draft the SCI's articles and the purchase together. To find a notaire see useful contacts. For how we accompany a purchase see buying with Amber Connections.
Frequently asked questions
Is an SCI worth it for a holiday home?
Sometimes. It is useful when several people or generations will own the home together. It also helps when you want to give shares to children over time. For a couple buying a home for their own use, buying in your own names is usually simpler and cheaper.
Can a non-resident set up an SCI in France?
Yes. Partners do not need to live in France or be French nationals. The SCI is registered in France and must keep accounts and file its returns there.
Can an SCI rent out the villa as a holiday let?
Only as an accessory activity. If furnished letting exceeds 10% of the SCI's turnover excluding VAT, the tax administration treats the SCI as liable to corporation tax, which changes the tax on rent and on a future sale.
Does an SCI avoid French inheritance tax?
No. Shares in a company that holds French property remain within the scope of French inheritance and gift tax for the value of that property. An SCI helps organise the transfer; it does not remove the tax.
What does an SCI cost to run?
There is no fixed figure. Expect the cost of drafting the articles and registering the company at the start, then an accountant for the annual accounts and the partnership return. Ask your notaire or accountant for a written quotation.
Can I put a property I already own into an SCI?
Yes, by contributing it to the company. The contribution is registered with the tax authorities and is free of duty for an SCI taxed as a partnership; it costs 5% where the SCI is liable to corporation tax, subject to exceptions. Take advice first, since the contribution may also trigger capital gains tax.
Last updated: 11 October 2026