A 2027 finance bill targets tax deferral strategies used by business leaders, altering rules on holding company share donations and reinvestment requirements.
Apport-cession mechanism overview
Since 2012, the apport-cession mechanism has allowed company leaders to sell their business through a holding company without immediately paying tax on their capital gains. This tool has been widely used by business leaders to defer tax liability when transferring ownership.2027 finance bill targets family transfers
The 2027 finance bill, submitted on October 1, 2026, does not eliminate the apport-cession mechanism but targets its family extension: the donation of the holding company's shares, which could permanently eliminate the tax. This change affects operations already carried out under a regime tightened by the 2026 finance bill.How the apport-cession works
Under the apport-cession, a leader contributes their shares to a holding company they control. The capital gain from this contribution is deferred. The holding company then sells the shares without capital gain, since their cost price is the contribution value. This deferral is not free and comes with reinvestment conditions.Reinvestment rules tightened in 2026
The 2026 finance bill raised the reinvestment quota from 60% to 70%, extended the reinvestment period from two to three years, and the holding period of investments from one to five years. Financial activities, managing a portfolio of assets, and most real estate activities no longer count toward the quota.Donations to children avoid tax
A common use of the apport-cession is donating the holding company's shares to children. This allows the deferral to pass to the donor, who controls the holding company. If they meet legal conditions, the capital gain from the contribution may never be taxed. This mechanism is the focus of the 2027 finance bill.Government version of the bill
Article 5 of the 2027 finance bill would end the deferral for any free transfer, donation, or inheritance. Income tax and social levies on the capital gain from the contribution would become due. A five-year payment plan with guarantees is planned. The text targets transfers made from October 1, 2026.National Assembly's version
The National Assembly’s version narrows the measure, exempting death from ending the deferral. It limits the tax to the portion of the price not reinvested in an economic activity and allows for a ten-year payment plan. The amendment applies to donations made from October 7, 2026, and extends to previous contributions.Upcoming version and legislative delays
The minister stated that none of the proposed versions fully met the objective and committed to revising the device. The vote on the first part was postponed, and the full text is set for November 17. The final content will be known only after further legislative steps and the publication in the Official Journal.Impact on a business leader in 2027
A leader who contributed shares worth 3 million euros to a holding company in 2021 faces different outcomes depending on the final law. Under the current law, the deferral would pass to their children. The government version would trigger tax on the full capital gain, while the Assembly version would tax only the unreinvested portion.Lessons and legal considerations
Economic reinvestment is the best protection against tax liability, and the timing of transfers matters. A donation with a usufruct reservation could limit the tax to the bare ownership. The effective date of October 1, 2026, is a critical factor, and the extension to previous contributions may affect operations based on earlier laws.Practical steps until the law is finalized
Until the law is published, business leaders are advised to delay donations of shares with deferred capital gains. Tracking reinvestments and comparing different tax schemes are essential. The final version of the law will determine the tax implications, and prudence is recommended until it is clear.
