The temporary sale of usufruct of commercial real estate, carried out via the shares of an SCI, is a powerful tool for fiscal and asset optimization, when it is structured with real economic logic and a duration consistent with financing.

This mechanism makes it possible to “live with the IS” during the usufruct period and to “return to the IR” when it expires, while transferring rent flows to the operating company.

Principle of the diagram

The classical scheme is based on a SCI with IR holding commercial real estate, whose shares are held by the company manager in full ownership.

The manager transfers the temporary usufruct of his shares to his operating company subject to corporate income tax for a fixed period (often 10 to 15 years), while maintaining the bare ownership of the shares.

At the end of the usufruct, full ownership of the shares is restored free of charge to the naked owner, without specific taxation on this meeting.

Tax interest: “Living at IS, dying at IR”

One of the major attractions lies in the displacement of rents in the company's income tax income, which can amortize usufruct and mechanically reduce its tax base.

During this period, the natural person partners of the SCI no longer have to declare any real estate income, considerably reducing their immediate taxation.

At the end of usufruct:

  • The SCI returns to traditional IR operation with allowances for the duration of ownership retained in the event of transfer.
  • The asset value of the building and the shares is restored, facilitating the transfer or subsequent transfer.

This sequencing smoothes the tax burden over time and makes it possible to adapt the structure to the life phase of the company and the manager.

Valuation of usufruct: an economic approach above all

It is essential not to be satisfied with the tax schedule in article 669 II of the CGI to set the price for the transfer of usufruct (23% per 10-year period).

The contractual valuation must be based on the updated cash flow method, which reflects the actual expected future flows (net rents, duration, risks), which:

  • Limits the risk of being reclassified as an abuse of rights or a fictitious act.
  • Constitutes a solid argument against the administration in the event of a transfer taxable as income (article 13, 5 of the CGI).

In practice, the administration tolerates the tax scale for registration fees or donations, but a coherent economic approach reinforces the legal security of the arrangement.

Viability conditions and risks

For the schema to be relevant:

  • The operating company must derive a real economic interest: rents received and tax savings must justify the price paid for the usufruct.
  • The duration of the usufruct must be at least equal to that of the loan taken out by the SCI, as recalled by the case law (Versailles Court of Appeal no. 10-02 186 of 03/11/2011)

Otherwise, the risk of being called into question (abuse of rights, reclassification as a disguised distribution) increases significantly.

Ancillary benefits and practical aspects

  • Reduced registration fees: €125 for the transfer of temporary usufruct of SCI shares, compared to 5% for a conventional transfer.
  • Wealth flexibility: the manager maintains control of the building through the bare ownership of the shares.
  • Immediate cash flow: the sale price of the usufruct can generate cash while optimizing the structure fiscally.
  • Benefit from advantageous tax regimes: “Living at IS, Dying at IR”

FAQ — Frequently asked questions about the temporary transfer of usufruct

What is a temporary transfer of usufruct?

It is the temporary transfer of the right to use and receive income from real estate (here via shares in an SCI) to another entity, while maintaining bare ownership. At the end of the period, full ownership is restored automatically and free of charge with the naked owner (Article 1133 of the Civil Code).


How long for temporary usufruct?

The duration must be consistent with that of the mortgage taken out by the SCI, often between 10 and 15 years. Too short a period of time can lead to fiscal challenges (abuse of rights or reclassification as a disguised distribution).

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How to assess temporary usufruct?

Do not limit yourself to the tax schedule in article 669 II of the CGI. The valuation must reflect the future flows that are actually expected:

  • Expected net rents,
  • The duration of usufruct,
  • Associated risks.

This economic approach secures the assembly and limits the risk of contestation by the administration.

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What are the main tax benefits?

  • Rents included in the company's income tax rate, allowing amortization and a reduction in the tax base.
  • No property income to be declared for the partners during the duration of the usufruct.
  • Reconstitution of full ownership without taxation specific to extinction
  • Benefit of reduced registration fees (€125 for the transfer of temporary usufruct of SCI shares).

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Is this setup suitable for all managers?

No It requires:

  • An SCI with significant professional real estate,
  • A corporate operating company capable of generating real economic interest.