Family SARL or SCI in France 2026: Tax and Wealth Structure Choice

Up to date as of 14 May 2026. Choosing between a family SARL (societe a responsabilite limitee de famille) and a SCI (societe civile immobiliere) is not a matter of administrative preference: it is a structural choice that determines the tax treatment of your activity, the social contribution regime of the manager, the rules governing transmission, and the ability to depreciate real estate assets. The two structures are frequently complementary rather than interchangeable, yet many business owners confuse them because both carry a family dimension. Cabinet Hayot Expertise in Paris accompanies many family groups through this decision, and the most costly mistakes almost always arise from a misqualification of the corporate purpose.

Summary: A family SARL applies to an operational commercial, artisanal or agricultural activity carried out between close relatives — it may opt for personal income tax treatment under CGI article 239 bis AA. A SCI falls under civil law for real estate ownership; it is by default subject to income tax (rental income category) with an irrevocable option to switch to corporate tax. The two structures are frequently combined within the same family group.

The income tax option under CGI article 239 bis AA#

The family SARL is a standard limited liability company (SARL) governed by articles L223-1 onwards of the French Commercial Code. Its distinctive feature lies in article 239 bis AA of the General Tax Code (CGI), which allows the shareholders to opt for the "societes de personnes" regime — meaning they are taxed directly on their share of the profit, under personal income tax, without first passing through corporate tax.

This option is available for a period of five financial years. It is renewable by unanimous shareholder decision before the option expires. It lapses automatically if a shareholder outside the legally defined family circle joins the company, or if the corporate activity shifts towards an ineligible activity (liberal profession, civil property management). The tax authorities verify the reality of the corporate purpose and the composition of the share capital during any audit.

Qualification criteria: shareholders and activity#

Two conditions must be met simultaneously and continuously.

First condition: all shareholders must belong to the same family within the meaning of article 239 bis AA. The text expressly refers to spouses, partners under a civil solidarity pact (PACS), direct-line ascendants, direct-line descendants, and siblings. The entry of any shareholder outside this circle — even a cousin or brother-in-law — triggers the automatic loss of the income tax option from the date of the event.

Second condition: the activity must be industrial, commercial, artisanal or agricultural. Liberal professions are expressly excluded. The management of a real estate portfolio through unfurnished letting is also excluded. A family SARL whose activity drifts towards a civil activity would lose the benefit of the income tax option.

The taxable profit follows the BIC rules (industrial and commercial profits) for commercial and artisanal activities, or the BA rules (agricultural profits) for agricultural activities.

The civil real estate company: Civil Code art. 1832 and 1845#

The SCI is a civil partnership governed by articles 1832 and following of the Civil Code for general principles, and by articles 1845 and following for the specific regime of civil real estate companies. Its corporate purpose is civil: it is not designed to carry out commercial activities. It may hold, manage and let buildings for residential or professional use, carry out isolated construction-sale operations, or organise the transfer of real estate assets within a family or succession context.

The SCI is a transparent structure by nature: its results are, unless an option is exercised, taxed directly at the level of the shareholders in the rental income category. This transparency is set out in article 8 of the CGI, which governs the regime of "societes de personnes".

Corporate tax option: irrevocability and consequences#

The shareholders of a SCI may, by decision of the competent body, opt for corporate tax treatment under article 239 of the CGI (and article 206-3 for the scope of application). This option is irrevocable: the SCI cannot revert to the income tax regime once the option has been exercised. The consequences are significant: the ability to depreciate buildings on the balance sheet (which reduces the annual taxable base), but a capital gain on disposal calculated on the net book value after depreciation — generally higher than the gain under the rental income regime.

The underestimated risk: many shareholders opt for the corporate tax regime to benefit from depreciation without factoring in the tax impact at exit. On a property held for 20 years with depreciation, the corporate tax gain on disposal can be considerably heavier than the rental income gain with holding-period relief. The trade-off is not automatically favourable to corporate tax.

Family SARL under income tax (BIC)#

With the income tax option, the shareholders of a family SARL declare their share of profit under the BIC or BA category. Deductible expenses are those of the operational activity: rent, wages, depreciation of equipment and working tools, general expenses. Personal taxation is calculated at the progressive income tax rate after applicable allowances.

The SARL remains subject to the accounting rules applicable to commercial companies: balance sheet, profit and loss account, tax return, filing obligations. At Cabinet Hayot Expertise, we systematically verify the consistency between the income tax option declared and the actual composition of the share capital at each year-end.

SCI under income tax (rental income)#

The income tax SCI allows each shareholder to deduct their share of actual expenses: loan interest, management fees, maintenance and repair work, land tax, insurance. Construction and improvement works are not deductible as rental expenses but are added to the acquisition cost for capital gain calculation purposes. This regime is suited to a long-term patrimonial investor who does not need to depreciate the property on the balance sheet.

SCI under corporate tax (depreciation but heavy exit gain)#

Corporate tax allows the property to be depreciated (excluding land) according to an accounting depreciation schedule, which significantly reduces the annual taxable profit. However, the capital gain base on disposal is the net book value after depreciation, and the standard corporate tax rate applies to the full gain with no holding-period relief. The corporate tax regime for a SCI favours indefinite holding or transmission by part donation rather than direct disposals.

Family SARL: majority manager as TNS#

The majority manager of a SARL falls under the self-employed (TNS) regime affiliated with the Securite sociale des independants (formerly RSI). Contributions represent approximately 35 to 45% of the net social profit (management remuneration and dividends above the threshold of 10% of capital and current accounts, to be verified). This level of social deductions must be factored into any comparison between a family SARL and a SCI.

SCI: no social contributions by default#

A SCI that generates no income from an activity is not subject to social contributions: rental income is excluded from the TNS contribution base. However, if the shareholders also carry out a professional activity, they must declare their rental income in their personal income tax return. The corporate tax option for a SCI may generate dividends subject to social charges (17.2% in social contributions for natural persons, to be verified).

Family SARL and the Dutreil Pact (CGI art. 787 B)#

The Dutreil Pact is a partial exemption device for transfer taxes on gifts or inheritance of shares in an operational company. Article 787 B of the CGI provides for a 75% exemption from the value of the securities, subject to conditions: collective holding commitment for two years, then individual holding commitment for four years, and exercise of a management function by one of the signatories. A family SARL whose activity is genuinely commercial, artisanal or industrial is eligible for the Dutreil. This device can be combined with the direct-line allowance (EUR 100,000 per parent per child, renewable every 15 years) to very significantly reduce the tax cost of transmission.

The SCI is in principle excluded from the Dutreil because its activity is civil and patrimonial rather than operational. Exceptions exist for civil companies with agricultural activities or in specific configurations, but they are tightly controlled and subject to evolving case law.

SCI and transmission by dismemberment#

The SCI offers remarkable structural flexibility for dismemberment: the parents retain the usufruct of the parts (and therefore the rental income) while donating the bare ownership to their children. On their death, the children recover full ownership without additional duties. The valuation of bare ownership is calculated under the fiscal scale of CGI article 669 based on the usufructuary's age, which optimises the taxable base at the time of donation.

The distinction between a family SARL and a SCI is not a preference: it is a legal qualification that follows from the nature of the activity. One does not choose a family SARL to manage unfurnished rental property, and one does not create a SCI to operate a restaurant. The confusion often arises from the fact that both structures carry a family dimension in common usage and that certain combined structures appear at first glance to be interchangeable.

In the files we handle at Cabinet Hayot Expertise in Paris, the most frequent and most solid structure is specific: the family SARL operates the activity (retail, restaurant, trade) and pays a commercial rent to a SCI that holds the property. The family SARL benefits from the income tax option if the shareholders wish, from the Dutreil Pact for the transmission of the business tool, and from the BIC deductions related to the operation. The SCI organises the patrimonial holding, progressive dismemberment and transmission of the property independently of the operational risk. These are two structures with distinct purposes and complementary logic.

A point to watch in 2026: the tax authorities are attentive to SCIs whose corporate purpose drifts towards a commercial activity, notably through recurrent and structured furnished letting. A SCI in which a significant proportion of receipts derives from furnished lettings may be reclassified as a commercial company, with automatic switch to corporate tax and regularisation of prior years. The applicable threshold and its exact interpretation should be verified against the tax instruction in force at the time the situation is reviewed.

A Paris family has been operating a restaurant for twelve years. Both parents are co-managers. They also acquired eight years ago the property in which the business premises are located. This is how Cabinet Hayot Expertise typically structures this type of file.

Structure 1 — Family SARL for operations: both parents and their two adult children are shareholders. The SARL carries out a commercial restaurant activity. It opts for income tax treatment under article 239 bis AA. Each shareholder declares their share of BIC profit. The Dutreil Pact is prepared for the future transmission of the business tool to the children with 75% value exemption.

Structure 2 — SCI for the property: the parents hold the SCI parts in full ownership; the SCI lets the premises to the SARL under a commercial lease. The SCI is on income tax (rental income), allowing the parents to deduct actual expenses. They progressively donate the bare ownership of the SCI parts to their children, retaining usufruct until retirement.

What this structure achieves: isolation of operational risk (the property is protected from a potential SARL insolvency), independent transmission of the business tool and the property, tax treatment specific to each class of asset.

What to avoid: confusing the two purposes, making the family SARL hold the property directly, or opting for corporate tax in the SCI without a long-term exit simulation.

Mistake 1: creating a family SARL to manage unfurnished rental property. This is not possible: article 239 bis AA expressly excludes civil activities. The income tax option would be challenged and the SARL would be reclassified as a standard SARL subject to corporate tax.

Mistake 2: opting for corporate tax in a SCI without a 15-to-20-year simulation. Depreciation reduces the annual taxable base but generates a heavy corporate tax gain on disposal. On well-located Paris properties, the difference can exceed several hundred thousand euros between the corporate tax regime and the income tax regime with holding-period relief.

Mistake 3: forgetting to renew the income tax option of the family SARL. The option is valid for 5 years. On expiry, the SARL automatically reverts to corporate tax if the renewal is not formalised. Cabinet Hayot Expertise tracks these deadlines systematically in all Paris engagements.

Mistake 4: introducing an outside shareholder without anticipating the loss of the income tax option. Even a minority entry by a third party into the family SARL share capital triggers the automatic loss of the income tax option from the date of the event.

• Is the activity commercial, artisanal or agricultural? (family SARL eligible) or civil/rental? (SCI appropriate)
• Do all envisaged shareholders belong to the family circle of CGI art. 239 bis AA?
• Is the intended holding period for the property more than 15 years? (weigh income tax vs corporate tax for the SCI)
• Is transmission of the business tool planned? (assess the Dutreil Pact)
• Is transmission of the real estate patrimony scheduled? (structure SCI dismemberment)
• Is a commercial lease between the SARL and the SCI planned and correctly drafted?
• Is the family SARL income tax option included in the articles and formalised on time?
• Has the corporate tax vs income tax simulation for the SCI been completed with a disposal horizon?

Sources: Legifrance — CGI art. 239 bis AA, art. 8, art. 239, art. 206-3, art. 787 B; Civil Code art. 1832, 1845; Commercial Code art. L223-1.