If you're planning to invest in French real estate—especially in a high-demand city like Paris—one key question will shape your strategy: Should you buy in your own name or through a company such as an SCI (Société Civile Immobilière – a non-commercial real estate company)?
Each option has its pros and cons, along with specific tax, legal, and administrative implications. Your choice will depend on your investment goals, your tax profile, and whether you're thinking long-term about succession and inheritance. This article breaks down the two main options—personal ownership and company ownership—to help you make an informed decision.
Buying in Your Own Name: Simplicity and Lower Costs
If you're buying a home in France for personal use—whether as a main residence, a secondary home, or even a rental property for modest income—purchasing in your own name is the most straightforward option.
Benefits of Personal Ownership
- Simpler administration: No need to set up and maintain a legal entity; therefore, fewer legal formalities
- Lower annual costs: You avoid the extra fees associated with company accounting, declarations, and management.
- Easier mortgage access: Banks often prefer lending to individuals rather than companies.
- Direct rental income: For rental purposes, personal ownership allows you to receive rent directly, without any dividend or corporate tax layers.
- Lighter taxation in the short term: If you're buying for rental purposes, personal ownership allows you to benefit from the micro-regime, resulting in lower taxes on your rental income in the short term.
Disadvantages of Personal Ownership
- Progressive Income Tax - Impact on Your Overall Tax Rate: In France, the more you earn, the higher your tax rate. Rental income is added to your total personal income, which can push you into a higher tax bracket and increase the overall amount of tax you pay.
- Less flexibility for succession: Passing property to heirs as individuals can trigger higher inheritance tax.
Who Should Buy in Their Own Name?
Personal ownership is best suited for:
- Solo buyers or first-time investors
- Individuals with moderate or stable income
- Long-term owners are not concerned with inheritance or succession planning.
Buying Through a Company: Flexibility, Shared Ownership & Estate Planning
While personal ownership is simple, buying through a company structure offers more flexibility, especially for investment purposes, inheritance planning, and co-ownership arrangements. Two common company types used in France for real estate purchases are:
- Société Civile Immobilière (SCI)
- Société à Responsabilité Limitée (SARL).
Option 1: Buying Through an SCI (Société Civile Immobilière)
An SCI (Société Civile Immobilière) is a civil real estate company structure not designed for commercial activity but well-suited for managing shared ownership or long-term holdings. It's a common choice among families, couples, or foreign buyers investing together. It's especially useful when co-owning a property, planning inheritance, or optimizing tax strategy.
Understanding SCI Tax Options: IR vs. IS
You have two tax options when forming an SCI:
➤ SCI à l’IR (Impôt sur le Revenu) – Personal Income Tax
With this option, the SCI is fiscally transparent. That means the company itself doesn't pay tax—each partner is taxed individually based on their share of the rental income. The income is added to your own personal tax return and taxed according to your income tax bracket.
✅ Best for: Families, couples, or small groups who want to keep things simple and benefit from personal tax allowances.
➤ SCI à l’IS (Impôt sur les Sociétés) – Corporate Income Tax
With this structure, the SCI is treated like a company. It pays corporate tax (currently 15% or 25%) on its profits. If you choose to take money out of the SCI as dividends, you'll also pay dividend tax (Flat Tax of 30%) on those distributions.
✅ Best for: Investors looking to reinvest profits, deduct more expenses (like depreciation), or manage furnished rentals through a more structured setup.
Benefits of Buying Through an SCI
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Succession Planning Made Simple: One of the biggest benefits of an SCI is how it handles inheritance. Instead of transferring the property itself, you can gradually gift shares of the SCI to your heirs. This approach allows you to reduce inheritance tax exposure through planned, smaller transfers and simplifies the legal process of passing on property.
- Flexible and Structured Co-Ownership: With an SCI, each owner holds shares in the company—not a physical portion of the property. This makes co-ownership much easier to manage, especially for couples, families, or investment partners. Everyone's share is clearly defined and legally protected.
- Lower Wealth Tax Exposure (IFI): For high-value properties (over €1.3 million), an SCI can help reduce liability under the Impôt sur la Fortune Immobilière (IFI) by deducting certain debts incurred by the SCI for the acquisition or improvement of the property from the IFI tax base.
- Clear Decision-Making: SCIs require a shareholder agreement (statuts), which outlines how decisions are made, how profits are shared, and how disputes are resolved. This creates legal clarity and helps avoid conflicts, especially in group ownership scenarios.
Inconveniences of SCI Ownership
Who Should Consider Investing with an SCI?
SCI ownership is best suited for:
- Families, couples, or small groups buying together
- Investors planning for succession
- High-net-worth individuals seeking tax efficiency
Option 2: The SARL (Société à Responsabilité Limitée)
A SARL is a commercial company that can be used for real estate rental activity, especially furnished rentals that generate regular income. It's more complex than an SCI and typically suited for professional investors.
Benefits of Buying Through an SARL：
- Limited Liability Protection: One of the key advantages of an SARL (Société à Responsabilité Limitée) is that your personal assets are protected. Your financial risk is limited to the amount of capital you've invested in the company, making it a safer structure for higher-value or income-generating real estate.
- Optimized Rental Income Management: SARLs are commonly used for furnished rental activities, particularly through the "SARL de famille" setup. This allows family members to operate rental properties under favorable tax rules, often enabling deductions for depreciation, expenses, and reduced income tax liability—benefits not typically available under personal ownership.
- Professional-Grade Accounting: As a formal commercial structure, an SARL follows structured accounting and financial reporting standards. This is especially useful if you're managing multiple rental properties, earning substantial income, or planning to grow your portfolio. It offers greater clarity for financial planning, banking, and long-term strategy.
Drawbacks of Buying Through an SARL：
- Heavier Administrative Burden: An SARL must follow strict accounting and reporting rules, including maintaining detailed financial records, filing annual accounts, and holding shareholder meetings. This often requires the help of a professional accountant and can add to your yearly costs and responsibilities.
- Subject to Corporate Taxation: Rental profits generated by the SARL are taxed under the corporate tax regime, currently at 25%. If profits are then distributed as dividends, an additional flat tax of 30% applies—leading to double taxation in many cases, unlike personal ownership.
- Limited Inheritance Flexibility: Compared to an SCI, a SARL offers less flexibility for estate planning. As a commercial company, it’s subject to stricter rules and offers fewer tax advantages. Transferring shares often requires shareholder approval and involves more complex legal formalities.
Who Should Consider Investing in SARL?
SARL ownership is best suited for:
- Real estate investors generating significant income
- Owners running a furnished rental business
- Those needing a formal commercial structure
Can Foreigners Own Property in France Through an SCI?
Yes—there are no specific restrictions on foreign ownership through an SCI (Société Civile Immobilière) in France.
What Foreign Investors Need to Know About Buying Property in France Through an SCI
- No need to be a French resident: Foreign individuals can set up or co-own an SCI without needing to register a company in France personally.
- French tax obligations still apply: Non-resident SCI shareholders are subject to French property taxes, and may be liable for the Impôt sur la Fortune Immobilière (IFI) if their net real estate assets in France exceed €1.3 million.
- Registered office requirement: The SCI must have an official address in France, which is used for legal correspondence.
- French bank account needed: The SCI must open a French bank account to handle property-related transactions.
- No extra purchase taxes: Buying property through an SCI doesn’t increase notary fees or purchase taxes—even if the shareholders are non-residents.
While French law is favorable, foreign buyers should also check how SCI ownership is treated in their home country. For example, some Swiss cantons may tax SCI shares, even if France does not.
👉 Want to dive deeper into tax planning? Check out our blog on Key Tax Considerations Before Buying Property in France in 2025 to make informed decisions and avoid costly surprises.
Final Thoughts: How Should You Invest in Paris?
If you're buying a primary residence or a simple investment property with a modest income, buying in your name may be easiest. If you're thinking long-term, want to share ownership, or plan for inheritance, an SCI could offer real advantages.
Every buyer is different. That's why Paris Rental and its subsidiary ANB Capital help guide our clients through both the property search and ownership structure—connecting you with experienced notaries, tax advisors, and legal professionals.
Editor: Siyi CHEN
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