Selling a French company through a holding: the 2026 contribution rules
In brief. A French-resident owner who contributes shares to a holding company he controls before a sale defers tax on the gain. Since the 2026 Finance Act, if the holding sells within three years it must reinvest at least 70 % of the price within three years in eligible activities and keep those investments for five years.
What changed
| Rule | Before | Since the 2026 Finance Act |
|---|---|---|
| Share of price to reinvest | 60 % | 70 % |
| Reinvestment deadline | 2 years | 3 years |
| Holding period for reinvestments | 1 year (general case) | 5 years |
| Excluded activities | Management of own securities or property | Wider: real estate, finance, insurance, furnished lettings, guaranteed income |
These rules apply to sales of contributed shares from 21 February 2026 (Law No. 2026-103 of 19 February 2026).
A worked example
Shares bought for EUR 1 m are worth EUR 21 m. Once contributed to the holding, the EUR 20 m gain is deferred. If the holding sells for EUR 21 m a few months later, it must reinvest at least EUR 14.7 m within three years. Without the contribution, immediate tax at the 31.4 % flat rate would be about EUR 6.3 m, before the high-income surcharge.
Two further changes
- A 20 % tax on certain non-business assets held by passive family holdings (cars, yachts, jewellery, family housing), for financial years ending from 31 December 2026.
- The 2027 budget bill, still under debate, would stop a gift of holding shares from wiping out the deferred gain.
Owners leaving France
An owner who moves to the UAE or elsewhere remains subject to French exit tax rules on unrealised gains in many cases. The order of events (move, contribution, sale) changes the outcome and must be planned with a French tax adviser.
Our role
We model the scenarios in figures, build the reinvestment plan and coordinate the tax lawyer and notary. Big4PM does not give tax opinions; we prepare the numbers and the decision.
Facing a decision like this?
We read every request personally and reply within 72 working hours when we believe we can be useful. The first review is free and without commitment.
Request a reviewSources
This guide is general information. It is not investment, legal or tax advice. The rules quoted must be checked by your advisers before any decision.