Exit tax

Leaving France?

Be cautious, you may be subject to exit tax on your intangible personal property…


In 2011 an exit tax was put in place to curb tax relocations before the disposal of financial investments. Amended in 2014, the taxpayers concerned are those transferring their tax residence outside France as of 3 March 2011.

Exit tax system

When a taxpayer was a French tax resident for at least six of the ten preceding years, and transfers his/her tax domicile abroad this entails tax and social security contributions on:

  • unrealized gains arising on:
    • either direct or indirect investments, of at least 50% of the share capital of the company,
    • direct investments in one or more companies (including OPCVM’s/UCITS), whose total value exceeds € 800,000
  • deferred capital gains,
  • claims on an earn-out payment.

 Are not subject to exit tax:

  • gains realized on real estate,
  • shares of open-ended investment companies (SICAV) ;
  • shares or securities of companies predominantly comprised of real estate (including SCI’s) ;
  • shares or securities referred to in article 244 bis A, I-3 of the French general tax code (CGI), particularly:
    • shares, securities or other rights of unquoted real estate companies, whether said companies are subject to corporation tax or not,
    • and shares, securities or other rights of real estate listed companies when the taxpayer owns directly or indirectly at least 10% of the company’s capital.

And many more…


A tax-deferral is automatically granted when the move is made to a member state of the European Union or a State that has concluded a tax assistance agreement with France. And if the move is made to another country, the taxpayer may request a tax-deferral providing certain financial safeguards are ensured.

Said tax-deferral is then terminated upon sale, redemption, or repayment of the respective securities.

Retention period

Capital gain tax is relieved or can be recovered if the taxpayer proves he/she still owns the investment(s) after a period of eight years after the move abroad. However social security contributions remain due.

For all moves abroad after December 31st, 2013, capital gains tax and social security contributions are exempt or refunded if the taxpayer can prove he/she still owns the investment(s) after a period of fifteen years after the move abroad.

Investment of shares subject to exit tax in a new company

Before doubts existed when it came to the tax neutrality of such a transfer.

New article 167 bis of the CGI provides us with clearer wording: the investment of securities, subject to exit tax after departing France, does not terminate tax-deferral when said deferral was granted under the conditions of article 150-0 B of the CGI (contribution of shares in a company subject to corporation tax, « offre publique », merger, division …) or postponed under article 150-0 B ter of the CGI (contribution to a company controlled by the contributor).

Gift of shares subject to exit tax

The law in place up until 2013 provided that a donation of shares subject to exit tax entailed the en