How does family SCI succession work? What are the steps to take and how to anticipate it? Family SCI is a formidable legacy tool that offers great flexibility of transmission during the lifetime of partners. But what happens when one of them dies? Get everything you need to know about family SCI succession?
A Few Reminders About Familial SCI
The SCI (Société Civile Immobilière) is a legal structure that makes it possible to manage real estate properties together. Unlike SCI, familial SCI brings together members of the same family to the fourth degree, including spouses. And unlike Family LLCs, Family SCI does not allow you to carry out business activity.
Family SCI assets clearly have a transmission of inheritance that is accessible. In fact, the partners have a powerful asset management tool that allows them to streamline the distribution of their assets during their lifetime. and anticipating succession in family SCI.
In addition, the assets in the SCI belong to the company and the partners share the shares forming it. Their nominal value is determined by the methods of family SCI. Why is this an advantage? Because it allows you to apply a legal deduction on the amount of shares and not on the value of the assets transmitted in the event of a gift or inheritance in a family SCI.
Thus you benefit from tangible benefits as you can transfer your assets:
- during his life;
- for family members you have chosen;
- And at a lower cost!
Family SCI Colleague Death: What’s Happening?
Many cases arise in the event of the death of a colleague of the family SCI. In fact, his successors may or may not already be present within SCI or may even refuse shares.
The heirs are part of the family SCI
The shares of the deceased are divided among the heirs. The latter families see an increase in their proportion within SCI. To do this, you only need to hold a general meeting to certify the new distribution of shares (numbering and numbering).
Example : The deceased had shares of 1 to 10. He transfers them to heir A, who already has 10 shares ranging from 11 to 20, and to heir B, who already has 10 shares ranging from 21 to 30. At the end of the GA, heir A would have 15 shares numbered 1 to 5 and 11 to 20, and heir B would have 15 shares numbered 6 to 10 and 21 to 30.
The heirs are not part of the family SCI
In most cases, the statutes of family SCI do not provide specific provisions for the integration of heirs into the company. In this case, it is sufficient to bring the partners together in a general meeting to record the arrival of new partners and to allot them the shares of the deceased. You will also have to modify the SCI’s statutes accordingly and inform the Registry.
However, an approval clause may be provided for. This means that the partners must give their consent for entering the family SCI to the heirs within 3 months. 2 scenarios are then possible:
- The Partners agree that, subject to the conditions provided by law, the heir family is integrated into the SCI;
- One or more partners refuse the approval of one or more heirs. They then decide to liquidate the respective shares, either by reducing SCI’s capital, or to buy them back. In all cases, the heirs get the benefit of compensation equal to the value of the shares and SCI has 2 years to repay the same.
Heirs refuse shares
It may also be that the heir family is not part of the SCI and does not want to be involved. Then they decline the shares they are entitled to. The SCI should then compensate them up to the value of the shares held by the deceased on the day of death.
This value may be assessed by agreement between the parties, or by an expert whose fees are payable by the SCI de famil.
dissolution of the family SCI
Final Scenario: The death of a partner results in a dissolution of the family SCI. This is especially so when it is made up of only one pair. Indeed, the essence of real estate civil society implies the presence of at least 2 partners. However, a period of one year is tolerated by the administration to allow SCI to find new allies to survive.
You can find all the ways to dissolve SCI in our dedicated article.
Family Succession SCI: Formalities and Taxation
What are the steps to be taken after the death of a partner? Whatever the status of the heirs, the succession takes place in three stages.
hold a general meeting
After the death of a partner, the family SCI must hold a general meeting to decide on the future of the shares held by the deceased. Once the decision is made, it should be recorded in the minutes of the general meeting signed by all the partners or their representatives.
Should the shares have been cancelled, whether they have been distributed to heirs or bought back by partners, you must amend SCI’s Association of Accounts. In fact, these reflect the reality of the company and hence indicate the correct distribution of shares. You have one month from GA to do this.
Whether the heirs are amalgamated or you proceed to transfer the SCI shares, the Registry must register the new status of the family SCI. To match your Kbis to reality, you need to enter an SCI revision file in the registry. The latter include others:
- copy of the GA report;
- A copy of the SCI Methods, updated and certified by the manager;
- One M2 form in duplicate;
- A copy of the identity documents of the new associates, if applicable.
This formality should also be completed in the month following the general meeting. Then you will get new Kbis from family SCI.
In order to optimize your family SCI and get all the benefits from it, it is important to anticipate the inheritance. Some operations are especially important for this.
fragmentation of shares
First of all, you should know that an SCI share has the same assets as assets, that is, they can be segregated. It means you are different:
- Bare ownership is what allows you to dispose of the asset;
- and usury, which allows you to enjoy the property and collect rent from it.
In bold in the middle: Bare ownership + usury = full ownership.
Why Break Shares in SCI? Because bare ownership and usury have different values, and there are qualities that make them attractive. In fact, usury ends with the death of the usurer. This means that if you owned an asset and the usurer dies, you recover full ownership of the property without any move or cost. One hell of a property gain!
donation of shares
The donation of SCI shares, or the free transfer of SCI shares, is the most effective operation to circulate your assets without spending a cent or approx! Thanks to fission, you can take advantage of the tax breaks available every 15 years to transfer bare ownership of your shares. It is calculated according to usury which is automatically calculated based on your age.
|under 21 years old||90%|
|under 31 years old||80%|
|under 41 years old||70%|
|51. less than||60%|
|under 61 years of age||50%|
|under 71 years of age||40%|
|under 81 years of age||30%|
|91. younger than||20%|
|over 91 years old||10%|
The older you are, the higher the value of bare ownership. That’s why it’s interesting to start airing your shares as soon as possible to reduce the cost of donations.
Example : You are 50 years old and you wish to donate bare ownership of €1,000 to each of your 2 children with a nominal value of 30 shares. Hence the bare ownership is 40% (usufruct 60%).
You have a tax allowance, the amount of which varies according to the relationship. This allowance can be used one or more times, and is renewed every 15 years.
|brother and sister||€ 15,392|
|nephew and niece||€ 7,967|
|but grandson||€ 5,310|
If we take our example, your donation is completely free of charge because of the perks:
- The value of 30 shares is: 30 x (1,000 x 40%) or €12,000;
- The available shortfall is €100,000. So you use €12,000 to “erasing” the donation fee payable. You will then have €78,000 left over to use for subsequent donations.
Donation of shares is indeed the best way to estimate succession in an SCI family!
case of surviving spouse
Protecting your surviving spouse in the event of death is an important asset of family SCI. Thus, dissolution becomes a means of protecting the spouse. In fact, by giving each other bare ownership of their shares, partners, spouses or cohabiting partners ensure to receive full ownership of their home at the time of the first death. So he retains the enjoyment of it and cannot be taken away by overly greedy or dishonest heirs.
Why make a family SCI?
This makes it possible to manage real estate assets with the family. From family vacation homes to investing in rental properties, opportunities are plentiful. And taxation, beneficial!
Who are the family heirs of SCI?
Families are the heirs of the SCI heirs to the partners. Then it could be a cousin, grand-grandson, nephew, niece, brother, sister, grandson or even great-grandson!
What are the tax benefits of family SCI?
The taxation of a family SCI is transparent, and you benefit from certain benefits in real estate rentals. The deduction provided for donations provides additional tax benefits to the family SCI.