Monaco SCI & French Inheritance Tax: Cross-Border Estate Planning Guide
Monaco SCI & French Inheritance Tax – Cross-Border Succession Planning Explained
1. Why International Families Use a Monaco SCI
A Monaco SCI provides structure, privacy, and continuity for families owning French property. Ownership passes through shares, not directly through the real estate, allowing flexible and discreet succession planning.
For non-French residents, this can also determine which law governs inheritance and how France taxes the transfer.
2. Succession Law: Which Country’s Rules Apply?
Under international private law principles (and the EU Brussels IV Regulation for EU residents), the law of the deceased’s domicile or chosen nationality governs the transmission of movable assets.
SCI shares are considered movable property—even if the SCI owns French real estate.
Therefore: if the shareholder is not domiciled in France or Monaco and has lived outside France for more than five years, the succession of their Monaco SCI shares follows the law of their domicile or chosen national law, not French civil law.
Example: A Swiss-resident Italian national holding shares in a Monaco SCI that owns a villa in France—succession is governed by Italian or chosen law, not French forced-heirship rules.
3. Inheritance Tax: France Still Taxes French-Situs Assets
Civil law and tax law are distinct.
Under Article 750 ter of the French Tax Code (CGI), France can levy inheritance tax if:
- The deceased was domiciled in France,
- The heir is domiciled in France (for at least 6 of the previous 10 years), or
- The asset transferred is located in France.
Even if the SCI is Monegasque, its shares are deemed French-situs assets if the company’s main assets are French real estate.
Result: France can tax the inheritance or gift of the SCI shares, even if the deceased lived outside France.
4. Cross-Border Example
Understanding how succession law and inheritance tax apply together is essential. When a Monaco SCI owns French property, two separate rules run in parallel — one determines which law governs the inheritance, and the other determines which country taxes it.
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Succession law follows the deceased’s domicile or chosen nationality (for EU residents under Brussels IV). Because SCI shares are treated as movable property, they typically follow foreign inheritance law, not French civil law — even if the SCI owns French real estate.
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Inheritance tax, however, follows the location of the underlying asset. Since the SCI owns French real estate, France treats the shares as French-situs assets, meaning French inheritance tax applies, even if:
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the deceased was not resident in France,
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the heirs are not resident in France,
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and the SCI is a Monaco entity.
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In practice: you may freely apply your own national succession rules, but France will still tax the transfer of SCI shares if the company owns French property.
5. Estate Planning Advantages of a Monaco SCI
- Flexible inheritance rules: allows families to apply their own national succession law instead of French forced-heirship.
- Simplified transmission: heirs receive shares rather than undivided property rights.
- Continuity & privacy: management and ownership transition seamlessly.
- Strategic planning: combine with wills, tax treaties, or life-insurance tools to limit double taxation.
Important: even though the shares follow foreign succession law, French inheritance tax remains due if the SCI owns French real estate.
6. French Residents: Prefer Direct Ownership
For individuals resident in France who intend to retire and remain French-tax-resident, purchasing property directly in their own name is generally more efficient.
A Monaco SCI offers no domestic tax benefit and adds filing complexity. It should be reserved for international ownership or succession structuring purposes.
A Monaco SCI is a powerful succession and governance vehicle, not a tax shelter.
It allows families to apply their own inheritance law and manage property collectively—but France still taxes French real estate, even when held indirectly.
With proper cross-border legal and tax planning, it remains one of the most effective tools for international families investing in French property.
Plan Your Cross-Border Succession With Confidence
Navigating French inheritance tax, international succession law and Monaco corporate structures requires precision — but you don’t need to do it alone.
At Monaco Properties, we assist clients throughout the entire process and work hand-in-hand with a network of trusted local notaires, legal advisors, tax specialists and corporate service providers in Monaco and France. Together, we ensure your structure is compliant, efficient and tailored to your family’s needs.
Contact us today to begin your discreet, confidential consultation.
Legal Notice:
The information provided in this article is for general informational purposes only and does not constitute legal, tax, or financial advice. Succession and tax rules vary based on nationality, residence, family situation, and the structuring of ownership.
Readers must obtain advice from a qualified notaire, lawyer, or tax specialist experienced in Franco-Monegasque cross-border matters. Monaco Properties assumes no responsibility for decisions made based on this publication.
