Selling your business: seller's obligations and capital gains tax regimes

It all depends on the first question: are you selling a sole proprietorship or shares in a company? For a sole proprietorship, capital gains may be exempt below certain revenue thresholds. For company shares, the flat tax rate (PFU) applies by default: 31.4%, comprising 12.8% income tax and 18.6% social security contributions. The deadlines, rights, and obligations differ in each case.

This page provides an overview; detailed pages exist for each tax regime. It does not cover the tax rates for business assets, social security contributions on capital gains from business activities, the CVAE (Corporate Value Added Tax), or the sale of securities by a holding company.

First sorting: what is being sold?

Sole proprietorship: exemption, or 12.80 %

The exemption for small businesses

The capital gain is fully exempt if two conditions are met: the activity has been carried out for at least 5 years, and the average of the revenue excluding tax does not exceed the threshold of your activity.

The average is based on revenue from fiscal years ending during the two calendar years preceding the end of the fiscal year of the transfer. Agricultural activities have separate thresholds. Building plots are excluded. The formula for the partial exemption is not provided on the page.

Above the thresholds

The tax administration's website (April 2025) indicates a levy of 12.80 % for long-term capital gains, and standard income tax for short-term gains. Article 151 septies A provides for an exemption of business capital gains for a seller who retires, under certain conditions; in this case, social security contributions relating to the exempted capital gains remain due.

The seller's deadlines

Company shares: flat tax rate, option for the tax scale, allowances

The basic regime

Capital gains from the sale of securities are automatically subject to income tax at a flat rate of 12.8% (%), plus 18.6% (%) in social security contributions. You can opt for the progressive tax scale in box 2OP of the tax return. This option applies to all investment income and capital gains within the household.

The holding period allowances do not apply to securities acquired from 2018 onwards. For older securities, they are 50 % (from 2 years to less than 8 years) and 65 % (8 years and more), with a more stringent regime for certain SME securities. These allowances are only applied in conjunction with the tax brackets.

Capital gains are declared in the income tax return for the following year. Capital losses are offset against capital gains of the same nature, and then against those of the following ten years.

The executive who is retiring

A fixed tax allowance of €500,000 on income tax is available to SME owners who sell all their shares and retire. Sales completed up to December 31, 2031, are eligible, according to impots.gouv.fr and service-public.gouv.fr. The amount increases to €600,000 in certain cases for sales from January 1, 2025 onwards. This allowance applies only to income tax; social security contributions remain payable. Specific conditions (company size, 25% tax credit on shares, management position, retirement timeline) are detailed on a dedicated webpage.

Registration fees

The deed must be submitted for registration within one month. Without a deed, the transfer of shares in a simplified joint-stock company (SAS) must be declared within one month (form no. 2759). For shares in a limited liability company (SARL), the official guidelines provide for a €500,000 allowance on the value of the shares when the transfer is made to an employee of the company (full-time permanent contract for at least two years, or an apprentice in progress) or a family member of the transferor. The transferor must have held the shares for more than two years, and the transferee must continue the business for five years and assume effective management. This allowance therefore does not apply to all transfers. It should not be confused with the allowance for retired executives, which applies to capital gains.

Obligations before and after signing

• Employee information. For transfers involving more than 50% of the share capital, the required information must be provided no later than one month before signing, since July 27, 2026 (the SARL fact sheet specifies the companies concerned). Damages may amount to 0.5% of the sale price, compared to 2% before this date. Transfers to a spouse, ascendant, or descendant are excluded.
• Statutes. In a limited liability company (SARL), the transfer of shares to a third party is subject to the approval of a majority of the partners representing at least half of the shares. In a simplified joint-stock company (SAS), the articles of association may stipulate approval, a right of first refusal (the transfer is void if this right is not respected), and a period of inalienability of up to 10 years.
• Beneficial owners. A declaration is mandatory when a natural person acquires or loses control, at the threshold of 25 %. The amendment request must be made within 30 days of the change.
• Legal notice. According to official documents, the transfer of shares does not require it on its own; it is required when the operation is accompanied by an amendment to the articles of association subject to publicity, to be published within one month of the decision.

When the pattern changes

• Contribution of a sole proprietorship to a company. The contribution is a transfer, subject to immediate taxation. Capital gains on non-depreciable fixed assets can be deferred if the contribution is a single, comprehensive transfer and the actual profit regime is applied. Other capital gains can be spread over five fiscal years (see the tax authority's April 2025 page).
• Securities contributed to a holding company before the sale. The tax deferral of article 150-0 B ter has been modified for transfers of securities contributed from 21 February 2026 (law no. 2026-103 of 19 February 2026): reinvestment, reinvestment quota and retention are concerned.

Numerical example (fictitious profile)

Situation. Three fictitious business owners each sell their companies for €700,000 in 2027, with a cost basis of €400,000, assuming the rules and rates remain unchanged from 2026: a capital gain of €300,000. The first owner has operated a sole proprietorship selling goods for 12 years, with revenues of €230,000 and then €250,000 over the two reference years. The second owner sells 100 shares in his simplified joint-stock company (SAS). The third owner sells 100 shares in his limited liability company (SARL).

Issue. What tax burden and what rights apply to the same price and the same capital gain?

Strategy. Identify the structure, then apply its system. No option for the scale, nor any retirement conditions.

Result.

The average of €240,000 remains below €250,000 and the business is over 5 years old: the exemption is total. Without it, and assuming the capital gain is long-term (as a hypothesis), a 12.80% flat tax rate (%) on €300,000 would have yielded €38,400, excluding social security contributions. For the SAS and SARL, the flat tax rate (PFU) of 31.4% (%) represents €94,200 (€38,400 + €55,800). The tax rate for the SAS is 0.1% (%) on €700,000. That for the SARL is 3% (%) on €677,000 (€700,000 minus €23,000).

These profiles are fictitious and their amounts are hypothetical. The calculation ignores the option for the tax scale and any allowances. The figures illustrate the mechanism and do not predict your specific situation.

What changes depending on your situation

• The structure sold : sole proprietorship or company.
• The length of time the business has been operating and your revenue for small businesses.
• The date of acquisition of your securities, which may or may not grant a tax reduction.
• Your retirement calendar, which conditions the €500,000 allowance.
• The percentage ceded, for the information of employees.
• A prior contribution to a holding company.

The rule depends on your situation. No results are guaranteed.