What is an SCI, and why do foreign buyers use one?
Quick answer: An SCI (société civile immobilière) is a French civil company that owns property. You hold shares in the company, not the bricks themselves. Buyers use one mainly to make succession easier (giving shares to children in stages) and to let several people own a house together without friction. It is a planning tool. It is not a tax shelter.
An SCI needs at least two partners. The company owns the villa and issues shares in proportion to what each partner puts in. International families like the flexibility: shares pass on in stages, you avoid the rigid rules of joint ownership (indivision), and the statutes set out governance to suit the family. On the other side, an SCI costs money to set up and to keep its accounts each year, and on its own it does not cut wealth tax or transfer taxes. It has to pay for itself through a real succession or co-ownership need. If you are still at the start, our guide to buying in France as a foreigner covers the steps around it.
Set it up with a notaire and a tax adviser
This is general information for foreign buyers, not legal or tax advice. Whether an SCI helps you depends on your family, your country of residence and your home-country tax rules. A badly structured SCI creates problems of its own (for US owners, for example). Always set one up with a French notaire and a cross-border adviser. Verified 29 June 2026.
SCI taxed at IR or IS: what is the difference?
By default an SCI is transparent (IR). The partners pay tax personally, and on a sale the individual plus-value regime applies, with the holding-period taper down to zero. If you opt for corporation tax (IS), you deduct depreciation from rental income, but you lose the CGT taper and the taxable gain on sale tends to be far larger.
For a family second home you plan to keep and hand down, IR is usually the better choice. You keep the personal capital-gains taper: no income tax after 22 years, no social charges after 30 (see our capital-gains guide). IS suits a property run as a rental business, because depreciation lowers taxable income. The catch comes on a later sale. The depreciated book value makes the gain larger, and the tax bill is often heavier. You can revoke the IS option only up to the fifth financial year after you elect it. After that it is final, so make the choice with your eyes open.
Does an SCI avoid the IFI wealth tax?
No. The IFI (real-estate wealth tax) applies to net French property worth more than €1.3 million, and SCI shares count towards that total. Non-residents pay it on their French real estate. Owning through an SCI makes no difference to IFI.
According to impots.gouv.fr, IFI is due when your net taxable French real estate (held directly or through companies such as an SCI) is above €1.3M on 1 January. The scale is progressive:
| Net taxable value | Rate |
|---|---|
| Up to €800,000 | 0% |
| €800,000–1,300,000 | 0.50% |
| €1,300,000–2,570,000 | 0.70% |
| €2,570,000–5,000,000 | 1.00% |
| €5,000,000–10,000,000 | 1.25% |
| Above €10,000,000 | 1.50% |
Note that the threshold is €1.3M, but once you cross it the tax is calculated from €800,000. Outstanding SCI loans and certain debts reduce the taxable base. Plenty of Riviera villas are worth more than €1.3M, so IFI is a real yearly cost, and an SCI does not remove it.
How does an SCI help with gifting and succession?
SCI shares are giftable in stages, so parents use the €100,000-per-child allowance every 15 years. With démembrement (you keep the usufruct and give away the bare ownership), full ownership passes to the children automatically on death, often with little or no inheritance tax.
Splitting a villa into shares that change hands easily is the main succession advantage of an SCI. Parents give the bare ownership of shares to their children now, at a discounted value because the parents keep the right to use the property. They go on living in it or letting it. On death, the usufruct ends and the children hold full ownership, generally with no further inheritance tax. Add the €100,000 allowance, which renews every 15 years (see our succession guide), and you have a strong, entirely legal planning route.
An SCI is one of three common ways to hold a home with others. For the trade-offs, read SCI, indivision or tontine compared.
Succession caveat for non-residents
SCI shares count as movable property. Brussels IV applies one law to the whole estate, but your home country’s courts and tax treaties sometimes treat shares differently from real estate you own directly. For some international families this helps. For others it complicates the plan. Make sure the SCI, your will and your home-country estate plan fit together. British owners should also read our note on English-law wills in France.
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