Wealth Management: European SCPIs, a smart international real estate investment
More and more French investors, particularly those already invested in high-end real estate in Paris, are turning to European SCPIs to enhance the performance of their wealth. These investment vehicles are attractive for their international diversification, exposure to European commercial real estate, and above all, their favorable tax treatment.
In a context of high taxation on French rental income, European SCPIs offer a strategic alternative for investors seeking yield optimization and tax efficiency.
How European SCPIs work
A SCPI (Société Civile de Placement Immobilier) is a collective real estate investment vehicle that allows investors to acquire shares in a diversified real estate portfolio, mainly composed of commercial assets such as offices, retail spaces, logistics platforms or healthcare facilities.
The rental income generated is redistributed to investors in the form of regular dividends, making SCPIs a popular solution for generating additional income alongside a premium residential real estate portfolio.
Taxation of French SCPIs: a limitation for high earners
Income generated by SCPIs is classified as rental income and subject to income tax and social contributions (17.2%).
As a result, investors in higher tax brackets may see nearly half of their income taxed, significantly reducing net returns.
This is precisely where European SCPIs become highly relevant.
Why invest in European SCPIs?
Reduced taxation through international real estate
European SCPIs benefit from exemption from French social contributions, representing a 17.2% tax saving.
Although income remains subject to income tax, international tax treaties prevent double taxation, making these vehicles particularly attractive for high-income households.
A powerful diversification tool
European SCPIs allow investors to diversify their international real estate exposure, complementing high-end residential assets in Paris or other major European cities, while reducing dependence on the French market alone.
European SCPIs and corporate tax (IS)
Companies subject to corporate tax (IS) can also benefit from investing in European SCPIs.
Thanks to tax treaties, rental income from foreign real estate assets is often fully exempt from taxation in France, making European SCPIs an efficient tool for treasury management.
For any further information, do not hesitate to contact one of our wealth advisers on 01 45 03 80 96.
