Setting up a French SCI for rental investment in 2026

This guide is written for expats and foreign founders by a French CPA, an English-speaking accountant in Paris, with practical focus on accounting in France, French corporate tax, business setup in France and French payroll.

The SCI (Société Civile Immobilière) is by far the most common legal vehicle for real-estate investment and patrimonial transmission in France. Well-structured, it protects, organises and optimises — poorly structured, it costs tens of thousands in unnecessary tax or exit blockages.

This guide by Samuel HAYOT, English-speaking French CPA in Paris 8th, focuses on the rental investor profile (different from the family-transmission SCI). Key arbitrages: IR vs IS, bank financing, exit taxation, furnished rental compatibility.

For the family-transmission strategy see our dedicated SCI familiale guide.

Three main objectives: (1) invest jointly (couple, family, partners), (2) facilitate transmission via gradual share gifting, (3) optimise tax via regime choice (IR or IS) and dismemberment.

Limits: minimum 2 members (no single-member SCI), civil object (no furnished rental under IR — automatic IS requalification), mandatory bookkeeping, no simplicity without a CPA.

Pass-through: each member declares pro-rata real-estate income (rent - charges - mortgage interest) on personal IR + 17.2% PS.

Pros: real-estate deficit up to €10,700/year deductible from global income, individual capital-gains regime on exit (full IR exemption after 22 years, full PS exemption after 30 years), special regimes (Pinel, Denormandie) applicable, light governance.

Cons: no asset amortisation, taxation up to 62.2% (45% MTR + 17.2% PS), often negative cash-flow Y1-Y5.

Company taxed at IS (15% up to €42,500, 25% above). Building amortisable (typically 25-30 years).

Pros: amortisation = major IS saving Y1-Y20, members untaxed until dividend, fast capitalisation.

Cons (often deal-breakers): exit gain = (sale price - net book value) at 25% IS — no duration abatement; distribution adds 30% flat tax → ~46% effective double tax; no special regimes; commercial bookkeeping (CPA fees ~2x).

When to choose IS: positive cash-flow desired (amortisation offsets IS), <10-year horizon with professional resale plan, dealer/promotion strategy, multi-asset constituted estate.

1. Members & split (50/50 or 99/1 strategies)
2. Capital — free, €1 minimum, €1,000-10,000 recommended for banking
3. Bylaws — duration (max 99 years), preemption, approval, manager powers, IR/IS election
4. Capital deposit — bank or neobank
5. Legal notice — flat €193 (€218 overseas)
6. INPI single window — bylaws, deposit certificate, declarations, M0 form
7. Registration — KBIS within 24-72h, fee €66.88

• Down payment: 10-20% of price + notary fees (~7-8% old, 2-3% new)
• Coverage: rent ≥ 1.3-1.5x mortgage payment (DSCR)
• Term: 15-25 years
• Personal guarantee or conventional mortgage
• Co-borrowing with members in personal capacity for scoring

Specialised banks: Crédit Foncier, Crédit Mutuel/CIC, BPI Immo, regional banks. Brokers: Pretto, Cafpi, Empruntis.

Pinel + IR-SCI combo: rent-controlled new build with 6/9-year commitment → up to 18% tax credit over 12 years stacked with real-estate deficit.

• Share dismemberment: gift bare ownership to children keeping usufruct — €100,000/parent/child every 15 years allowance, decoded usufruct value (article 669 CGI)
• Contribute SCI to a holding: rollover relief (article 150-0 B ter) for future cession optimisation
• Variable-capital SCI: easier to add/remove members over time

See our SCI familiale transmission guide for detailed patrimonial strategy.

1. IS-SCI for long-term project → catastrophic on resale (~46% effective)
2. Furnished rental in IR-SCI → automatic IS requalification
3. €1 capital → bank declines financing
4. Generic bylaws → governance lock-ins
5. No partners' agreement when members aren't related
6. No CPA → tax audit risk, late 2072 filing penalties
7. No 10-20-year IR vs IS modelling before decision

Investing via SCI without 20-year modelling → average €30-80k tax differential per asset over hold period. We provide:

• Pre-investment audit: 10-20-year IR vs IS modelling
• Tailored bylaws (transmission, dismemberment, partners' agreement)
• Notary / bank / broker coordination
• Annual SCI bookkeeping & filings
• Holding/contribution strategy for constituted estates

Free SCI project audit

• service-public.fr — SCI
• Legifrance — Civil code articles 1832+
• BOFiP — SCI tax regime
• BOFiP — IFI and SCI shares
• INPI — Single window
• Bpifrance — SCI

See also: Family SCI & transmission | Holding vs SCI | Status comparison