French CIS and non-resident partners: what tax consequences?

A French SCI may seem to offer a simple framework for holding a property in France. As its partners reside abroad, however, the analysis becomes much more strategic.

Taxation no longer depends solely on the SCI itself: it must be assessed through the residence of each partner, the applicable tax treaty, the nature of the income received and the future consequences of an assignment or transmission.

SCI does not neutralize the international dimension of the case

A non-resident partner may be exposed to several levels of taxation under the ICS tax system, the manner in which revenues are allocated, and the treatment used in his or her State of residence.

The firm therefore analyses the situation on two levels: firstly, the French taxation of the structure and the real estate assets; on the other hand, the manner in which such detention is apprehended in the partner's jurisdiction of residence.

It is this cross-reading that makes it possible to identify any friction, double taxation or structural inconsistencies.

A heritage structure must be designed with the mobility of partners

An SCI can remain in place for several years as the personal situation of its partners evolves: expatriation, return to France, transmission, change of residence or transfer of shares.

The firm's expertise consists of integrating these potential developments from the outset and determining whether the structure retains its relevance over time.

This approach compares the different options of detention, anticipates future effects and directs associates towards a more efficient heritage organization.

Master Edouard Pruvost specializes in consulting on real estate and international tax strategy. The firm intervenes on SCIs comprising non-resident partners in order to analyse the tax consequences in each jurisdiction concerned and to identify the most appropriate structures. To have your situation analysed and to benefit from tax strategy advice, contact the firm.