There are several ways to buy and hold the shares of these companies. Here is how to optimize your acquisition, depending on your goals.

Invest in shares of REITS (civil Societies, investment in real estate), is to become an associate of a company that purchases commercial real estate (offices, walls, shop, hotel,…). She then manages to your account, you are donating a share of the rents collected. Depending on your situation, your age and typology of heritage, there are different ways to buy these units. Some allow you to reduce your taxable base, while meeting your objectives.

1. Buy shares of REITS with…

This mechanism is to buy direct of the shares of REITS. To do this, please contact the company manager, your bank or insurer (which you will sell the REIT of its subsidiary), a management consultant of heritage or an Internet platform that specializes in these investments.

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Careful with this mode of detention, each year, the property tax paid by the REIT will be taxed at your bracket marginal tax, and submitted, in addition to social contributions of 17.2%, or a tax of a maximum of 62,2% (45 + 17.2 per cent). In addition, the value of the shares of REITS includes the taxable basis in the itis (income Tax on the real Estate asset).

To reduce your tax burden, this solution is preferable if you are not or weakly enforced and do not have or little rental property. This will help you avoid to increase your property income, or to jump a slice to the IFIS.

• Benefits : an investment calibrated according to your means, the choice of REITS, immediate revenue.

• Disadvantages : a taxation to 100% of income paid by the REITS, no leverage and therefore a limited investment to your personal contribution.

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2. …Or credit

Another option : buy shares of REITS in financing all or part of the acquisition with a loan. The bank that finances your operation will verify your creditworthiness criteria. Attention, if you intend to buy any REIT other than that of its management subsidiary, you will need to fiercely negotiate to get your credit.

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The other solution is to get your folder of loan by a broker credits or contact the management company of the REIT in which you want to invest in, to find out if it has a partnership with a financial institution.

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The interest of a credit purchase is that the loan interests are deductible from the income property. Thus, your taxable basis is reduced by the first years, the interest being high in the monthly repayments at the beginning of the credit. The tax savings will be much higher than your bracket marginal tax is high.

• Benefits : you can take advantage of the leverage effect of credit and invest more than your initial bet, to maximize your tax (income tax + IFI).

• Disadvantages : cost of credit (interest + insurance + warranty), any difficulties in order to get a loan, some REITS are not accessible to credit.

3. Put REITS in its life insurance

You may also invest in shares of REITS within your life insurance coverage. Contracts in units of account that offer this type of media. Attention, they are proposed by some insurers, and the offering of REITS is limited by contracts (between one and ten are available).

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The main interest of this mode of acquisition is that your savings invested in REITS, as well as revenues generated, are subject to the taxation of life insurance. They are, therefore, considerably less taxed than if you hold REIT in a direct. In addition, liquidity is optimal, you can buy or sell units in a few days. But beware, it is not possible to invest in credit life insurance, it is thus necessary to have prior savings.

Practice >> Learn more about investing in REITS in partnership with Corum

Finally, be aware that the insurer will issue not necessarily 100% of the revenues of the REIT since it can keep a party under its “profits” (the reserves which will draw in case of a decrease of yields).

• Advantage : more liquidity, taxation very attractive life insurance policy.

• Disadvantages : limited choice of REITS (approximately 20% of the market is accessible via life insurance), limited choice of insurance life, lower return, as the costs of managing the contract are always considered on the income of the REIT, and the inability to finance the investment with credit.

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4. Invest in break-up temporary property

This mechanism is to split the usufruct (the right to receive the income) of the bare ownership (possession) of the shares of REITS for a given period of time, usually from ten to fifteen years. At the end of the period initially set, the break ends, the usufruct is extinguished the bare owner gets the entire property of the units and affects the income in turn.

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Depending on your objectives, two choices are possible :

– You buy the temporary usufruct : this allows you to ensure a steady income during a given period of time, for an initial investment, since you only purchase the usufruct.

– You buy the bare ownership is temporary : as you do not touch any income during the duration of the break-up, you’re not being imposed (even in the title of the IFI by the usufructuary). If you are highly taxed, it is an excellent way for you to build an estate to supplement your retirement pension without blowing your tax during your period of activity.

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• Benefits : usufructuary and bare owner receive a discount to the purchase price of the units dismemberment (most of the dismemberment is long, least the bare ownership is expensive), to the bare owner name : optimal tax system during the dismemberment.

• Disadvantages : all REITS are not sold in break-up, during break : no income for the bare-owner, when it shall end : the beneficiary loses any right to income.