SCI – non-profit association of persons
It is a contract between two individuals or entities usually for the purpose of optimal asset management. Company for tenure in France – should be established before the signing of the final deed of sale.
The initial capital of the company is not fixed, so it can be from 1.500,00 EUR and remain locked in the account at the time of establishment of the legal entity.
No age restrictions for Founders.
No restrictions on the form of contributions and allocation of capital between the Founders.
SCI institution time is about ten days after presenting of all required documents:
Photocopies of the passport of each shareholder
Copies of official documents about the family situation of each shareholder
Bank details of the shareholders. Statement of financial position or recommendation of the banking Institution
Information on the place of residence of shareholders: for Russian clients a copy of the national passport and residence permit, as well as the receipt of payment of utility bills
Charter and the certificate of registration of legal entities, Founders SCI
Preliminary contract for the purchase of real estate.
Authorities oblige meet with a client to start cooperation. All documents must be translated into French, with an apostille.
SCI – a flexible structure, ideal for long-term family investment. It has the same tax benefits that individuals and other additional benefits associated with the acquisition of real estate in their own possession. Besides, after 15 years of ownership, and in the case of resale property or shares of a company, there is no value-added tax. After 5 years of ownership, net worth is reduced by 10 % per year. Commercial company, in its turn, subject to endless high taxes. Non-profit association of persons, as opposed to commercial companies has liabilities on profit distribution, which has the following consequences: the shareholders are free to use the Company’s property. In fact, there is no contract on the lease of immovable property between the Company and shareholders. This point is very important because for foreign commercial companies, real estate owners in France require a contract of lease and received revenues that flow from this are taxed at the rate of 33%. You need at least two companions in the nonprofit association of persons, for example, two spouses can be shareholders. We can talk about the physical and legal entities. Nevertheless, shareholders – legal entities are tax regime individuals. This type of organization does not have a mandatory minimum capital. This is the free choice of the shareholders. SCI status allows ownership of real estate by several persons and facilitates their transfer. It’s a great solution that helps to avoid problems when disagreements shareholders on the division of property, the issue will be resolved manage the company (there may be several). The Company has a tax advantage for the transfer of shares relating to real estate, where their value is taken into account, be allowed a deduction for debt likely determine the net asset value, which will be the basis for calculating the right to inheritance.
SCI has another advantage, in spite of real estate that cannot be transferred by shares; SCI can be transferred partially under the guise of donating shares. It is also possible the division of shares between existing shareholders, this transaction is not taxable.
In comparison to the acquisition by a private person, SCI allows You to use the same favorable tax scheme for value-added, and there are other additional benefits.
In the case of acquisition by private person:
tax income above a certain limit (ISF – “wealth tax“) is appointed, if the value of the real estate exceeds 770,000 euros, in the absence of bank financing. All that exceeds this amount is subject to a differentiated tax of 0.6 % – 1.8%, charged each year.
Company for management and sale of property (SCI) avoids tax on income above a certain limit (ISF), as the current accounts of the shareholders are treated as investments abroad.
In the matter of inheritance, divided shares and not property. Current accounts are also exempt from inheritance rights.