Wood and forest, put some green in your heritage

The reasons for investing in a wood or a forest can be diverse and varied: some will privilege the "bucolic" or "ecological" side of the thing, others will aim at a more economic and patrimonial objective (to diversify its investments, to benefit from tax advantages and regular incomes, to pass on to its children...). Like stone, it is a safe and solid investment, less subject to economic "disturbances" than other investments (shares...).

A thoughtful purchase

About 75% of the 17 million hectares of French forests are privately owned

As for any investment, it is essential to take time to think about your project. After having "targeted" your objectives, calculate the budget that you wish (and can) mobilize for this project and, of course, find the appropriate financing. In your financing plan, don't just take into account the purchase price. Some additional costs will be added to it and must be taken into account (fire or storm insurance in particular, maintenance, fitting out...). The next step will be the definition of the geographical area where you wish to invest, as well as the "composition" (the specialists speak of "stand") of your forest (coniferous, deciduous, coppice... young or older trees...).
When developing your project, think about the future and also about a possible resale with the tax consequences that could result from it. Only after you have set your objectives and studied all the existing possibilities with an expert can you move on to the next step: the purchase.

Alone or in a group

Once your project is well defined, you need to find the right partner to make it happen. There are several ways to buy in a wood or a forest:

• either you buy in a private forest estate by contacting an owner directly or by going through a specialized intermediary (notary)
• or you buy shares from a Groupement foncier forestier (GFF), owner of the forest. This solution is the simplest. You don't have to worry about management, you receive regular income and can benefit from more attractive purchase prices.

Taxation: its major asset

The cost (and profitability) of your investment will depend on several elements: value of the soil, nature of the species composing the forest, age and health of the trees, proximity of access roads... In all cases, your investment will be profitable only after several years, but the tax system remains interesting whatever the case.
As far as taxation is concerned, the Tax Incentive Scheme for Investment in Forests (or DEFI Forêt) entitles you to an income tax reduction of
18% of the amount of expenses incurred for the purchase of wooded plots or plots to be wooded, the acquisition or subscription of shares in forestry groups. This possibility is open until December 2022. This type of investment is also of interest for inheritance purposes. Woods and forests, as well as forestry group shares, are subject to transfer duties on only 25% of their value. But the benefit of this 75% allowance is subject to several conditions:

• the departmental director of agriculture and forestry must certify that the woods and forests concerned are susceptible to regular management or exploitation;
• the heirs or beneficiaries of the donation must commit to normal exploitation for 30 years.

If the deceased had purchased shares in a forestry group, the exemption only applies to shares purchased more than 2 years ago.

Marie-Christine Ménoire