It is common that over a company’s lifetime changes to partners will occur and company shares are then sold.
But what about the tax regime for the registration of these company securities and where are they registered.
These different regimes are outlined in three parts below:
- Share transfers
- Partner share transfers
- Transfer of partner shares in a company whose main activity is real estate
1. Share transfers
With regard to Article 726 and Article 718 of the General Tax Code(CGI), share transfers are subject to the following tax regime:
| Nature of the transfer | Securities traded on a regulated market Registration fee due on the transfer price | Unlisted securities Registration fee due on the transfer price |
| Transfers not recorded by a deed | No registration fee, regardless of the company’s nationality | French company: 0.1% Foreign company: no registration fee |
| Transfers recorded by a deed in France | 0.1% | 0.1% |
| Transfers recorded by a dead overseas | French company: 0.1% (with imputation of the tax paid abroad) Foreign company: no registration fee |
French company: 0.1% (with imputation of the tax paid abroad) Foreign company: no registration fee |
Where and when to register this share transfer materialised by a deed?
The registration must occur within a month and be made to the competent registration service.
The competent registration service at the time of a share transfer is that of the domicile of one of the parties to the deed, or the residence of the notary if the transfer is carried out by notarial deed.
2. Partner share transfers
With regard to Article 726 and Article 718 of the General Tax Code(CGI), share transfers (other than companies whose main activity is real estate) are subject to the following tax regime:
| Nature of the transfer | Company shares transferred Registration fee due on the transfer price |
| Transfers not recorded by a deed | 3% after the application of a tax deduction on the base (in the amount of 23,000.00 euros); regardless of the nationality of the company |
| Transfers recorded by a deed in France | 3% after the application of an allowance on the base (in the amount of 23,000.00 euros); regardless of the nationality of the company |
| Transfers recorded by a dead overseas |
French company: 3% after the application of a tax deduction on the base (in the amount of 23,000.00 euros); regardless of the nationality of the company Foreign company: no registration fee |
Where and when to register this share transfer materialised by a deed?
The registration must occur within a month and be made to the competent registration service.
The competent registration service at the time of a share transfer is that of the domicile of one of the parties to the deed, or the residence of the notary if the transfer is carried out by notarial deed.
If the domicile of the parties is located abroad, the Non-Resident service will be competent to register the share transfer.
3. Transfer of partner shares in a company whose main activity is real estate
Regarding Article 726 and Article 718 bis of the General Tax Code (CGI) , the transfer of shares of companies whose main activity is real estate (“The legal entity’s main activity is real estate business, regardless of nationality, whose corporate rights are not traded on a regulated market for financial instruments within the meaning of article L. 421-1 of the Monetary and Financial Code, or on a multilateral trading facility system within the meaning of article L. 424-1 of the same Code and whose assets are, or have been, during the year preceding the sale of the shareholdings in question, principally constituted by real estate or immovable rights located in France or holdings in legal entities, regardless of their nationality, whose rights are not traded on a regulated market for financial instruments within the meaning of article L. 421-1 of the Monetary and Financial Code, or on a multilateral trading system within the meaning of Article L. 424-1 d. the same code and themselves with a predominance of real estate “) are subject to the following tax regime:
| Nature of the transfer | Company shares transferred Registration fee due on the transfer price |
| Transfers not recorded by a deed | 5% regardless of the nationality of the company |
| Transfers recorded by a deed in France | 5% regardless of the nationality of the company |
| Transfers recorded by a dead overseas | 5% regardless of the nationality of the company (with imputation of the tax paid abroad) |
Where and when to register this share transfer materialised by a deed?
The registration must occur within a month and be made to the competent registration service.
The competent registration service at the time of a share transfer is that of the domicile of one of the parties to the deed, or the residence of the notary if the transfer is carried out by notarial deed.
If the domicile of the parties is located abroad, the Non-Resident service will be competent to register the transfer of shares.