The confinement episodes have left traces. More and more city dwellers, and in particular Parisians, are buying second homes to breathe in the fresh air. Prices in “cathedral cities” (Reims, Chartres, etc.), in provincial sub-prefectures, but also in seaside towns have literally exploded (see infographic) . It remains to ask yourself some preliminary questions, depending on the use you want to make of your second home (give it to children or not, rent it occasionally or not). Here are the three points to check before taking the plunge.
1 / In cash or on credit?
With rates which remain historically low (under 1% for credit terms less than or equal to twenty years), future owners would be wrong to deprive themselves! “When you can borrow, you have to do it”, according to Alexandre Boutin, director of asset engineering at Primonial. On this point, there is no debate. Unless you have a rental investment in sight, in which case you will have to reserve your borrowing capacity for it, which is not expandable (30% of your net income at most). This, for elementary tax reasons : “Your loan interest is deductible from your rental income, which provides a solid tax savings, when your tax bracket is high. Thanks to the loan, the leverage effect is maximum on rental property, “argues Sophie Nouy, head of asset engineering at Cyrus.
2 / Live, via a SCI …
Second question to ask yourself: should you buy your second home directly or via a real estate company (SCI) ? “The first solution has the advantage of simplicity, but it has the major drawback that if you die, your holiday home will be in joint possession between your different heirs, a method of detention considered precarious, which involves collegial decision-making and sometimes conflictual “, explains Alexandre Boutin. The SCI allows you to get around this problem, since you are the only manager. However, you can distribute shares in the company to your children by way of donation or by inheritance, which facilitates transmission. “In addition, if the SCI borrows to buy your second home, the amount of the loan will be taken into account in the valuation of the company, reducing at the same time the value of the shares given to the children, which will generally allow each of them to remain below the reduction threshold of 85 000 euros, beyond which the donation is taxable “, continues Alexandre Boutin.
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However, SCI does not have all the virtues. “When you buy directly, you can rent your second home as you see fit, which is not the case with an SCI”, warns Sophie Nouy. It must, as its name suggests, have a “civil” activity, or rent its second home (necessarily furnished), similar to a commercial activity. “Suddenly, if your SCI makes furnished rental , even occasional, it goes from corporation tax office (IS), and this reserves some bad surprises at the time of resale, specifies the specialist.Under this IS regime in fact, your property is depreciated upon acquisition, which depending on the duration, reduces its net book value to a meager portion of its initial value. But at the time of resale the taxable gain will be enormous, since calculated on the difference between the sale price and the residual value, depreciation deducted ! ” And once the capital gain has been taxed to the IS, it will be necessary, to benefit from it, to take out the money from the sale of the SCI via dividends … taxed at 30%. “The piling up of taxes is considerable in this situation,” insists Sophie Nouy. The SCI is therefore a good solution, except for those who want to rent their second home.
3 / … or a holding company?
“Executives who have sold their business, and put the money from the sale into a holding company subject to the IS, often ask me if it would not be more judicious to buy their second home via this structure. But it is clearly a false good idea “, explains Sophie Nouy. The initial idea is as follows: if the holding company buys the holiday home, the owner does not have to take out any money and therefore no flat tax to be paid on the dividends received. He thus saves 19% tax and can buy bigger. “What they often forget is that a holding company must have a commercial activity and if it buys the second home, then it must be paid rent at real market conditions. Otherwise, it is an abnormal act of management or abuse of social property, punishable by criminal penalties, ”continues the specialist. The sums intended to pay the rent have generally already been taxed and they will be taxed again in the holding company. “In the long term, it is necessarily more expensive than the simple payment of tax on dividends”, concludes Sophie Nouy.
Dario Ingiusto / L’Express