France advances holding-company gift deferral changes

The existing deferral framework

DGFiP’s August 2026 comments on Article 150-0 B ter of the Code général des impôts distinguish deferral from exemption. They describe the reinvestment exception for a holding company selling contributed shares within three years: for sales from 21 February 2026, the stated minimum reinvestment is 70% within three years, subject to eligible-use conditions. Its separate gift guidance describes circumstances in which the deferred gain transfers to the recipient rather than becoming immediately taxable.^[4][5][6]

What the adopted amendment proposes

Amendment I-3089 would introduce a gift or manual-gift trigger where the contributed shares had previously been sold, redeemed, repaid or cancelled within eight years of contribution. For an operation within three years, it targets deferral maintained through reinvestment under Article 150-0 B ter I(2)(d), the fund-investment route. For a later operation, it instead addresses proceeds not reinvested within the prescribed time and proportion through the routes in paragraphs a, b or c.^[2][5]

The proposed charge is fraction-based: I-3089 uses the relevant reinvested or non-reinvested proceeds ratio, rather than automatically taxing the whole deferred gain. It also addresses a reinvestment deadline still running at the gift, subsequent loss of value, and gifts with retained usufruct. Specified reorganisations and exchanges are excluded from the prior-disposal test, subject to the amendment’s wording.^[2]

The amendment would provide a ten-year payment plan under Article 1681 G and adapt the interaction with Article 167 bis, the exit-tax provisions. These are proposed statutory changes, not a payment option currently created by this vote.^[2][1]

Transitional wording requires care

I-3089 originally restricted the change to gains arising on contributions from 7 October 2026. Adopted sub-amendment I-3985 deletes its final four paragraphs; its explanatory statement expressly seeks to include earlier contributions. The parent amendment’s original restriction should therefore not be presented as the adopted protection for existing arrangements. A final authoritative composite and application clause remain important before assessing a particular transfer.^[2][3][1]

The sitting records I-3089, as sub-amended, passing 36–25 and amended Article 5 passing 25–23. For business owners and groups using French holding structures, the practical issue is how a contemplated gift interacts with the original contribution, any intervening disposal and the reinvestment route. The vote does not itself establish a new tax liability; the final legislative outcome still matters.^[1][2][3]