Real estate investment trusts (REITs) outside of France and Europe: eliminate social security contributions

Introduction: The "all-French" syndrome«

Take a fictional example: an expatriate in Singapore owns a substantial property portfolio in the Lyon area. Between property tax, energy-efficiency renovation work and 17.2% social charges on his rental income as a non-resident, his net return becomes low.

This is the breaking point that many investors reach. One option: a partial switch towards yield-focused SCPIs outside France. Why? Because once it crosses the border, each euro you invest is no longer subject to the same pressure. Welcome to the era of European property, where performance goes hand in hand with surgical tax optimisation.

What is a French real estate investment trust (SCPI) that generates income outside of France?

An «international» or «European» SCPI (Société Civile de Placement Immobilier) is a collective investment vehicle that buys, manages and rents real estate assets (offices, shops, logistics, health) located outside the national territory.

At Balmont Conseil, We analyze these vehicles not as simple financial products, but as portfolios of tangible assets exposed to different economic cycles. Investing in a SCPI international yield, It means becoming a co-owner of an office building in Berlin, a logistics center in Madrid, or a clinic in Dublin.

Types of international SCPIs

• The "Pure Players": They invest almost all of their assets outside of France (e.g., Eurovalys, offices in Germany; Corum Origin, invested approximately 93,130 outside of France).
• The Opportunists: They combine France and Europe according to market cycles.

Why does Balmont Conseil's expertise favor European SCPIs?

Beyond the simple definition, the international SCPI is the tool of geographical and tax diversification par excellence. In a fragmented macroeconomic context, real estate does not react in the same way in Paris as in Warsaw or Lisbon. Our approach consists of exploiting these differences to stabilize your net-net return.

1. The lever of cross-border taxation (The major advantage)

This is where the true power of investing lies for a French resident or expatriate. Unlike French rental income, which is taxed at your marginal tax rate (TMI) plus 17.2% in social security contributions, foreign-sourced income benefits from bilateral tax treaties:

• Social security contributions: Rental income from properties located outside France is exempt from French social security contributions when it is granted an effective tax exemption, or when the tax credit equal to the French tax is applied against the CSG and CRDS social security contributions, which tax treaties treat as income tax. The Franco-British tax treaty excludes this application. The financial income of the SCPI (real estate investment trust) and its share of French assets remain subject to social security contributions.
• Mechanism for eliminating double taxation: The tax is paid in the state where the property is located. In France, the tax credit equal to the French tax offsets income tax and related social security contributions, and the income remains taken into account to calculate the rate applicable to other income.

2. Analysis of cycles and local markets

At Balmont Conseil, we scrutinize three key indicators before validating a European SCPI:

• The depth of the rental market: A building in Munich does not have the same rental liquidity as an asset in Rome.
• Rent indexation: We favour areas where leases are securely indexed to local inflation to protect your purchasing power.
• Exchange rate risk: For our clients in the Eurozone, we favour assets denominated in Euros in order to eliminate any currency volatility, while remaining open to targeted opportunities (e.g. Poland) if the "prime" return justifies the exposure.

3. Hands-free management for the expatriate

For non-residents, international SCPIs solve the "logistical nightmare." You delegate rent collection, maintenance management, and local legal compliance to leading management companies. 

The expert's opinion: «Investing directly abroad is a legal obstacle course. An international SCPI (Société Civile de Placement Immobilier) is the only vehicle capable of offering you pan-European real estate exposure with complete tax transparency, without ever leaving your home, whether you are in Lyon, Dubai, or Singapore.» 

— Alexis Sagnier

4. Focus on the key themes for 2026

• Last Mile Logistics: Expansion of hubs in Germany and the Benelux countries.
• Health and Education: Very long leases (12-15 years) offering rare visibility on cash flows, particularly in Ireland and Spain.
• "Prime" Offices: Only assets meeting the strictest ESG standards, essential to guarantee resale value in 10 years.

Do you want to compare the tax impact of a French SCPI versus a European SCPI based on your marginal tax rate? Our simulation tools incorporate the latest tax treaties to model your actual gain.

The major advantages: Why cross the border in 2026?

1. SCPI returns abroad: A performance bonus

Historically, European markets (Germany, Spain, Ireland, Poland) have offered more attractive capitalization rates than in France.

• Decorrelation of cycles: While the Parisian market is undergoing a price correction, metropolises like Madrid or Dublin are showing robust rental dynamics driven by an undersized supply.

2. The elimination of social security contributions (CSG/CRDS)

The effect of this exemption can be calculated in a few seconds with our SCPI simulator.

This is the killer argument, too often overlooked by poorly advised savers.

• The mechanism: For a French tax resident, income from international SCPI 100 % is exempt from the 17.2 % social security contributions. Why? Because this income is from a foreign source and international tax treaties take precedence over domestic law.
• Impact on the Net-Net: At the same gross yield, a European SCPI (French real estate investment trust) mechanically offers a net performance approximately 1 percentage point higher than a French SCPI for an investor in a marginal tax bracket (TMI) of 30% or higher. The 1.57 percentage point difference in the comparative table below also incorporates the difference in gross yield used in the example (4.80% versus 5.50%).

3. Diversification of the SCPI portfolio

By not putting all your eggs in the same "hexagonal" basket, you dilute your rental and regulatory risk:

• Regulatory diversification: You reduce your exposure to French reforms (rent control, property tax reforms).
• European ESG standard: The international SCPIs we select anticipate European environmental standards, which helps to preserve the resale value of the asset over 10 or 15 years.
• Economic stability: You expose your capital to economies whose fundamentals (GDP growth, unemployment rate) differ from those of France, thus smoothing the volatility of your assets.

Alexis Sagnier's view: «Balmont Conseil’s open architecture allows us to select management companies that are not tied hand and foot to the Parisian market. By 2026, geographical diversification is no longer an option, it’s a safety net.»

4. Optimized taxation through the tax credit mechanism

Beyond social security contributions, income tax itself is reduced. Thanks to tax treaties (particularly with Germany and Spain), the tax paid locally by the SCPI entitles it to a tax credit. tax credit in France (equal to the amount of French tax corresponding to this income, which remains taken into account for the rate applicable to your other income).

• Result : You avoid double taxation and drastically reduce the overall tax burden on your dividends.

Do you want to compare these solutions with your assurance-vie? Consult our guide on the’Luxembourg assurance-vie for non-residents for a total portability strategy.

Focus on Taxation: How does taxation work?

The taxation of international SCPIs is based on bilateral tax treaties signed between France and the countries where the properties are located.

The mechanism to avoid double taxation

Two methods coexist according to the conventions: Germany, Spain and Italy are subject to a tax credit equal to the French tax; the Netherlands and Ireland, to exemption with an effective rate:

1. The Tax Credit: You declare the income in France, but you benefit from a tax credit equal to your French tax.
2. Exemption with Effective Rate: Foreign income is not taxed in France, but it is used to calculate the tax rate on your other income.

Data Factsheet: Comparison France vs Europe (Theoretical Example)

Note: These figures are simulations. At Balmont Conseil, we project these scenarios over 10 years based on your actual marginal tax rate.

⚠️ Warning: This arrangement is strictly dependent on your tax residency. An expatriate in the USA will not be treated the same way as a resident of Lyon. A misinterpretation of the tax treaty can turn an opportunity into an administrative nightmare. [Book a situation assessment]

Risks specific to investing outside of France

We can't promise returns without talking about risk. That's our ethos at Balmont Conseil.

• Exchange rate risk: If the SCPI invests outside the Eurozone (Poland, United Kingdom, USA with Corum USA), currency fluctuations may impact your dividend.
• International rental risk: Mastering German tenancy law is not the same as mastering French commercial lease law.
• Liquidity: As with all real estate, there is a waiting period before shares can be resold.

Who should favor this type of investment?

1. The French taxpayer with a high marginal tax rate (30%, 41%, 45%): For whom French taxation has become confiscatory.
2. The expatriate and the non-resident: For whom investing in SCPIs from abroad is the simplest solution to maintain a link with European real estate without direct rental management.
3. The saver seeking diversification: To decouple its assets from the French residential real estate market.

Which European SCPIs should you consider in 2026?

The market is moving fast, but among the names often considered:

• Eurovalys: Specialist in the German office (bundle of economic stability indicators).
• Comet (Alderan, launched in December 2023): invests outside of France, primarily in the European Union, and opportunistically in North America, Australia and New Zealand.

How to actually invest in a foreign SCPI?

The process seems simple, but the devil is in the details:

1. Asset audit : Determine the proportion of your assets to be exposed.
2. Analysis of the detention structure: Should the shares be held directly, via a assurance-vie policy or a holding company?
3. Subscription: It can be done in a fully digital manner.

FAQ: Frequently Asked Questions

Q: Do I have to file a tax return in each country?

A: No. The management company pays the tax in the country where the properties are located. The French tax resident declares this income on form 2047, then transfers it to forms 2044 and 2042 in the boxes provided for foreign-source income, using the amounts reported by the management company. The non-resident does not declare their foreign-source income in France.

Q: Are European SCPIs eligible for credit?

A: It's more complex than for French SCPIs. Few banks agree to finance foreign assets, but we have specific banking partners who accept the pledging of shares.

Q: What is the average entry ticket price?

A: Often accessible from €200 or €1,000, making it a remarkable diversification tool from the earliest stages of building wealth.

Conclusion: Real estate without borders, but not without a guide

Investing in SCPIs (real estate investment trusts) for income generated outside of France is a lever worth considering in 2026 to improve your after-tax income. However, choosing an SCPI solely on its past yield is a classic mistake.

The role of Balmont Conseil, [Company Name], a wealth management consulting firm based in Lyon, filters European macroeconomic data to identify only investment vehicles whose strategies align with your life goals. This innovative approach allows our clients to benefit from a wealth management in Europe which adapts to market changes while remaining aligned with their personal aspirations. Thanks to our expertise and data-driven simulations, we are able to offer tailored recommendations, thus maximizing the potential of each investment. By working closely with our clients, we ensure that their assets grow in harmony with their values and life goals.

Your wealth deserves a vision that extends beyond France.

Ready to optimize your property taxes?

Don't let social security contributions eat into your profitability.

👉Request a Feasibility Audit with Alexis Sagnier

Sources:

• International tax treaties (impots.gouv.fr website)
• ASPIM Annual Report
• Quarterly analyses of asset management companies (Corum, Advenis, La Française)
• General Tax Code: Articles on the taxation of income from foreign sources.

Useful links:

• Settling in and optimizing your tax situation in Singapore
• Understanding the criteria for tax residency according to Article 4 B of the French General Tax Code (CGI)
• Net-net return of SCPIs for expatriates

To learn more: European SCPI for non-residents: optimize your assets.