The family real estate investment company (SCI) is the ideal way to manage and optimize joint property assets. It is far more flexible than joint ownership, and makes it easier to transfer property assets to children. The partners are free to define the operating, management and profit-sharing procedures.
The SCI familiale is similar to the traditional SCI, except that here it is set up by partners who are related to each other through marriage or family ties. This status enables them to jointly manage (rent, sell, hold or acquire) one or more properties.
Partners are not required to be owners to the same extent. Each partner must nevertheless understand that the property or contribution belongs to the SCI familiale collectively. In return, they receive a number of shares proportional to the amount of their contributions.
There are 4 steps to setting up a family SCI.
Step 1: drafting the articles of association
It is essential to draw up the company's articles of association in accordance with the law and the partners' objectives. They must specify the name of the company, its purpose, its duration and the contributions of each partner. They must also specify how the capital is to be divided among the partners, the amount of share capital, how the company is to be managed, and the procedures for transferring shares. It is also important to specify whether the SCI has a commercial address, as this will determine which court has jurisdiction in the event of a dispute or litigation.
When setting up an SCI, you need to specify the manager(s) and the clauses concerning their appointment. The articles of association can be drawn up by a notary or by the partners themselves (private deed).
Partners must also choose the most advantageous tax regime. Two tax systems exist. These are income tax and corporation tax. In the first case, the profits of the SCI are taxed in the name of the partners, according to their shares in the company. In the second case, the company is taxed. By default, the family SCI is subject to income tax.
Step 2: Setting up share capital
The share capital of a family SCI can be made up of contributions in cash or in kind (real estate by way of illustration). The minimum amount of share capital to be deposited is 1 euro.
Step 3: Publication of the notice of creation
A notice of the creation of the family SCI must be published in the legal gazette of the location of the newly-formedcompany. The notice contains a number of compulsory details. Following this, the manager receives a certificate of publication, which must be included in the registration file.
Step 4: Preparing and submitting the registration file
The application file must include the company's articles of association, a copy of the M0 form and a copy of the partners' identity papers. It must also include proof that the SCI is domiciled in France, and proof that the legal notice has been published.
The application file must be submitted to the clerk's office of the commercial court or to the Centre de formalités. Once all the administrative formalities have been completed, a Kbis extract is issued to the partners.
In addition to its flexibility of operation and organization, the SCI familiale avoids indivision and any conflict between family members in the event of divorce or inheritance. It sets the rules for managing jointly-owned property. It facilitates the transfer of property within couples and families.
Among the advantages of an SCIalso offers a degree of protection for personal assets. The debts resulting from an SCI real estate investment have no impact on the partners' personal assets. The SCI is the perfect vehicle for real estate investment. It makes it easier to build up substantial capital, apply for financing and pool costs.
Written by our expert Editorial staff
le 22 février 2023
