SCI and LMNP: which taxation for rental property
SCI and LMNP: comparing the two schemes for rental property in France and their respective taxation.
Read morePersonal taxation
Personal taxation covers income tax, but also more specific schemes tied to rental real estate such as the SCI property company, LMNP status or capital gains tax. This section explains these mechanisms with worked examples.
The articles detail how an SCI works under income tax or corporate tax, the conditions of LMNP status and its depreciation mechanism, and how capital gains tax is calculated when reselling a property.
Content relies on impots.gouv.fr, the official tax bulletin (BOFiP) and Légifrance, updated after every finance law that changes a tax scale or allowance.
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Frequently asked questions
What is the tax advantage of an SCI property company?
A société civile immobilière (SCI) makes it easier to manage a property jointly and to transfer it gradually through share gifting, with a choice between income tax and corporate tax depending on the wealth strategy pursued.
What is the LMNP furnished rental status?
LMNP (non-professional furnished landlord) allows renting out a furnished property under an advantageous tax regime, notably through depreciation that significantly reduces taxable rental income, subject to income and registration conditions.
How is real estate capital gains tax calculated in France?
The capital gain is the difference between the sale price and the purchase price, adjusted for justified costs and works. It benefits from progressive allowances based on holding period, up to a full exemption after 22 or 30 years depending on the tax concerned.