All you need to know about the family SCI

A Société Civile Immobilière (Real Estate Civil Company) is a group of people joining together to buy a property and make a profit from it.

It has a registered office, a minimum capital, requires at least two natural or legal persons to create it, and its operation is defined in its articles of association.

There are many SCIs (property holding companies) tailored to your plans. For example, a rental SCI allows you to rent out and manage property while avoiding the problems that can arise from joint ownership.

The SCI de jouissance à temps partagé allows the distribution of time during which each person can live in a property in proportion to their capital contributions to the company, although the risk of litigation between partners is high.

Finally, there's the construction-sale SCI, or the allocation SCI, which are additional forms to choose from depending on your needs.

The family SCI makes it possible to optimize the management and transfer of property within the family circle.

It allows several members of the same family to share ownership of a property through a company, in proportion to their share.

That helps optimize taxation when transferring assets to heirs.

This is one of the many advantages offered by a family SCI (Société Civile Immobilière).

Why create a family SCI?

Beyond just buying property together as a family and sharing ownership, a family SCI mainly helps to make property management much simpler and more transparent.

The company's articles of association must specify the appointment of one or more managers.

This setup often helps avoid disagreements between family members, as important decisions need to be discussed and voted on in a general assembly according to the rules set out in the articles of association.

How to create a family SCI?

The first step is to solidly build your project between the future partners. Then, you should contact a competent person to draft the articles of association of the SCI.

Drafting them can sometimes be tricky, so it's a good idea to get in touch with a professional.

The articles of association must include the following information:

• The number of partners at the time of creation (minimum of two);
• The registered address;
• The company's lifespan (99 years maximum);
• The family connection between each partner ;
• The capital contributed (no minimum capital required).

Once drafted, it is up to you to publish your decision in an approved legal announcement journal.

This step will then allow you to submit your complete file to the Centre des Formalités des Entreprises (Business Formalities Centre) or the Registry of the Commercial Court. The Registry of the Commercial Court will give you a Kbis extract certifying the legal existence of your company.

What are the advantages of this type of company?

Appointing a manager to handle the property's management is definitely one of the most significant advantages, as the partners aren't required to do it themselves. Although the most important decisions are made by the partners in a general meeting, the manager is the one who handles the property on a daily basis.

Above all, this legal structure allows you to optimize your assets when transferring ownership.

A family SCI makes it possible not to divide up the family assets, which remain intact within the company.

That protects all the assets if one of the partners passes away.

What are the obligations of the partners?

Each of the partners is indefinitely liable for the company's debts, regardless of the amount of their share.

Their liability isn't limited to their contributions to the company, and their personal assets can be used directly to cover the SCI's debts.

That reinforces the need to use a trustworthy manager, as poor management can have serious consequences.

Nevertheless, it is possible to adjust the liability of the partners in the articles of association, by distributing the losses without necessarily corresponding to the share or the distribution of profits.

However, no partner can have fully limited liability, even if they are a minor.

Family real estate companies (SCI) are among the most popular types of SCI in France due to their many advantages for acquiring and managing property, organizing joint ownership, and reducing donation costs.

Before even asking yourself, "When should I create a family SCI?", ask yourself, "Why?".

It's very likely that this legal structure will meet your needs and those of your family.