Patrimonial Holding Company

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“Alexis, my company generates cash that I dare not draw out as dividends because of the tax burden. I would also like to invest in property and prepare the transfer to my children without dismantling everything. Is there a structure capable of centralising it all?”

This challenge is the daily reality of the entrepreneurs and investors we advise at Balmont Conseil. The answer often lies in a powerful legal and tax engineering tool: the patrimonial holding company.

A genuine "parent company" of your personal ecosystem, the holding company is not reserved for large groups. It is the pivot of modern wealth management, allowing a tax burden that is merely endured to be transformed into vastly amplified investment capacity.

At Balmont Conseil, we implement the structural, financial and investment solutions most closely aligned with your circumstances. With my expertise and ALTA, the AI-augmented wealth engineer, my mission is to transform your tax burden into strategic firepower, optimising every lever of your patrimonial holding company to safeguard and pass on your legacy with unrivalled precision.

Tailored analysis

What is a patrimonial holding company?

Definition and concept

A patrimonial holding company is a legal structure (often a SAS or an SARL) whose principal purpose is not to sell a product or a service, but to hold and manage stakes in other companies (subsidiaries), as well as financial or property assets.

Unlike an operating company that carries on a commercial activity, the "pure" holding company is a holding structure that centralises your assets. It is described as "patrimonial" when it is controlled by a family nucleus with the aim of structuring, protecting and growing the family wealth.

The types of assets managed

A holding company can house a wide diversity of assets:
  • Shares in operating companies: your stake in your main business.
  • Property: through holding units in an SCI (this is then referred to as a property holding company).
  • Financial investments: securities accounts, capitalisation contracts, private equity investments.
  • Cash: to reinvest the profits of the subsidiaries.

    • Why set up a holding company? The strategic advantages

    The patrimonial holding company offers "leverage" across three essential dimensions.

    Tax optimisation and the "parent-subsidiary" regime

    This is often the primary driver behind setting up a holding company. Thanks to the parent-subsidiary regime, the holding company can channel up the dividends of its subsidiaries while benefiting from an almost complete tax exemption (only a 5% share of costs and expenses remains taxable).

    • Impact: where an individual would pay 30% Flat Tax on their dividends, the holding company pays only around 1.25% in effective tax. This saving of 28.75% becomes an immediate investment strategy.

    L'intégration fiscale et la capacité d'endettement

    If the holding company owns more than 95% of its subsidiaries, it can elect for tax consolidation. The losses of one subsidiary (or the finance costs of the holding company) offset the profits of the other subsidiaries. This maximises the group's overall borrowing capacity to finance new projects.

    La centralisation et l'optimisation de trésorerie

    The holding company makes it possible to grant intra-group loans without going through a bank. It becomes the family's private bank, reallocating the surpluses of company A towards property investment B or the launch of company C (business creation).

    Passive Holding vs Active Holding: A crucial distinction

    The choice between a passive holding company and an active holding company is not merely a matter of management, but of genuine tax engineering. The difference lies in the operational involvement. This is a major point of vigilance for any wealth management adviser.

    The Passive Patrimonial Holding: The simplicity of a strongbox

    Often referred to as a "portfolio company", its role is purely static. It collects dividends and manages its financial or property assets.

  • The limits: because it carries on no commercial activity, it is excluded from most preferential regimes. It remains subject to the IFI (Property Wealth Tax) on its property share and does not allow the transfer of wealth to be optimised aggressively.
  • For whom? Investors seeking a simple holding structure, with no wish to run a group.

    • The Active Holding: The engine of the group

    This is a company that, in addition to holding stakes, actively takes part in steering its group's policy and controlling its subsidiaries.

  • The genuine role: it must provide internal services (HR, strategy, treasury, IT) formalised through management agreements ("Management Fees").
  • The tax evidence: the tax authorities require concrete proof of this active role (minutes of board meetings, evidence of services rendered).

    • The crucial issue: The tax "passport"

    Qualifying as an active holding transforms the company's tax nature: it is treated as an operating business. This distinction is the safety lock securing three major advantages:

  • The Dutreil Pact: this is the Holy Grail of wealth transfer. It allows the shares of the holding company to be passed on with a 75% relief on their taxable value. Without an active role, this scheme is virtually out of reach for a holding company.
  • IFI exemption: the shares of an active holding company may be regarded as business assets and, as such, be entirely exempt from property wealth tax for the director.
  • IR-PME income tax reduction: subscribing to the capital of an active holding company can give rise to income tax reductions, which is not the case for a passive holding company.
    • Caution: moving from a passive holding company to an active one demands absolute legal rigour. A failure to demonstrate an active role, identified on a succession, can result in a devastating tax reassessment.

    At Balmont Conseil, we implement the structural, financial and investment solutions most closely aligned with your circumstances. With my expertise and ALTA, the AI-augmented wealth engineer, my mission is to transform your tax burden into strategic firepower, optimising every lever of your patrimonial holding company to safeguard and pass on your legacy with unrivalled precision.

    The Holding Company in the Service of Wealth Transfer

    The patrimonial holding company is the ultimate tool for succession optimisation.

    Gifting of shares and the splitting of ownership rights

    Instead of giving property assets or company shares directly (which are complex to divide), you give shares in the holding company. Using the splitting of ownership rights, you give the bare ownership to the children (for a reduction in inheritance tax) while retaining the usufruct (the income and the control).

    Moreover, for the employer, the base of the payroll tax may be affected by the amount of the inbound-assignee premium. Poor anticipation of these costs can turn the mobility of foreign employees into a financial abyss for the French subsidiary.

    Tax deferral (Contribution-and-Sale)

    The contribution-and-sale mechanism (Art. 150-0 B ter of the CGI) is an extremely powerful tax-deferral mechanism. You contribute the shares of your operating company to your holding company before selling them.
  • The benefit: the capital gain on the sale is placed under tax deferral. As long as the holding company reinvests 60% of the sale proceeds in an economic activity within 2 years, you pay no tax on the capital gain. It is a phenomenal growth lever.

    • How does a patrimonial holding company work and how is it created?

    The steps of setting it up

    1. Wealth audit: determining whether the holding company meets a genuine need (tax, transfer, reinvestment).
    2. Choice of legal structure: the SAS is favoured for its statutory freedom (ideal for separating capital from control). The SARL may be chosen for its social security framework (self-employed director).
    3. Contribution of shares or top-down creation: a holding company can be created "from below" (contribution of a business) or "from above" (contribution of existing shares).
    4. Drafting of the articles of association: a crucial moment for setting out governance and exit clauses.

    The parties involved

    Setting up a holding company is a team effort. Your chartered accountant will handle the tax and accounting side, while your wealth management adviser or your tax lawyer will orchestrate the overall tax structuring so that it fits within your life strategy.

    AI-augmented advisory firm in France

    The Balmont Conseil Expertise : High-Precision Wealth Engineering

    Few advisers point it out, but the inbound assignee enjoys a breath of fresh air on their property wealth.

    At Balmont Conseil, we do not settle for offering you a theoretical tax structure. Our expertise rests on a cross-disciplinary vision where the human and the technological meet. As an Augmented Wealth Engineer, Alexis Sagnier draws on sharp expertise in company law and taxation to orchestrate bespoke structures.

    Our added value lies in our ability to model the financial flows of your future holding company over several decades using AI, while ensuring constant regulatory monitoring in the face of legislative instability. We work closely with your chartered accountants and notaries to ensure complete legal certainty. Choosing Balmont Conseil means entrusting the architecture of your fortune to a firm that masters the most complex tools (Dutreil, Contribution-and-Sale, Ownership Splitting) to transform your business wealth into an enduring legacy.

    Which profiles for which structure? Concrete cases

    Tax optimisation of inbound assignment is a magnet for tax audits. The French authorities have developed algorithms to detect abuses.

    The SME Director (Objective: Reinvestment)

    • Situation: Marc earns €200k in dividends. Held directly, he is left with €140k after Flat Tax.
    • Holding solution: through the parent-subsidiary regime, €197k remains within the holding company. Marc uses this €57k of "tax gain" to finance a property worth €300k with a loan.

    The Self-Employed Professional (Objective: Capitalisation)

    • Situation: a surgeon wishes to smooth her income and invest her surpluses.
    • Holding solution: she sets up a SELARL capped by a SPFPL (a holding company for regulated professions). She draws out only what is necessary as salary and capitalises the rest within the holding company for her retirement planning.

    The Property Investor (Objective: Transfer)

    • Situation: a couple owns 5 SCIs. Management is fragmented.
    • Holding solution: centralisation of the flows and the introduction of a progressive gifting of shares to the children, while retaining control of the strategy through the holding company.

    Pitfalls and limits to watch for

    The holding company is not a miracle solution free of risk. While it offers formidable flexibility, it also places the director under the magnifying glass of the tax authorities. Optimisation must never become a vulnerability.

    At Balmont Conseil, we implement the structural, financial and investment solutions most closely aligned with your circumstances. With my expertise and ALTA, the AI-augmented wealth engineer, my mission is to transform your tax burden into strategic firepower, optimising every lever of your patrimonial holding company to safeguard and pass on your legacy with unrivalled precision.

    Rigour as a safeguard

    Abuse of Law: Substance above all

    The tax authorities may invoke abuse of law (Article L. 64 of the LPF) if they consider the holding company to be an "empty shell" whose sole purpose is to avoid tax.
  • Economic reality: the holding company must have a reason to exist (managing stakes, centralising cash, preparing a transfer).
  • The risk: if the structure is deemed "fictitious", the tax advantages are cancelled and coupled with an 80% penalty.
  • Advice: systematically document strategic decisions (minutes of board meetings, management reports) to prove the genuine activity of the structure.

    • The Cost / Benefit Balance: The threshold of relevance

    A holding company is not free. It generates unavoidable structural costs:
  • Fixed costs: bookkeeping, preparation of the balance sheet, registry fees, and often civil liability insurance for the director.
  • The calculation: it is generally reckoned that a holding company becomes worthwhile once the reinvestment capacity or the flow of retained dividends exceeds €30,000 to €50,000 per year. Below that, the tax savings (via the parent-subsidiary regime) may be absorbed by the running costs.

    • Managing the Flows: Beware of blurring assets

    Administrative rigour is the price of tax security.
  • Cash: it is strictly forbidden to use the holding company's bank account for personal expenses (risk of misuse of company assets). Every movement of funds between the subsidiary and the holding company must be justified by a treasury agreement or a duly recorded distribution of dividends.
  • Formalities: general meetings must be held annually. A holding company neglected administratively is a priority target in the event of an audit, as it loses its credibility as an "operating company".

    • FAQ : 10 key questions on the patrimonial holding company

    What is the minimum contribution to set up a patrimonial holding company?

    Can you live in a property owned by your holding company?

    What is the difference between a property holding company and an SCI?

    Can I convert my current company into a holding company?

    Does the holding company reduce the IFI?

    What is tax consolidation?

    Why is the SAS favoured for a holding company?

    What are the annual costs of a holding company?

    Is the parent-subsidiary regime automatic?

    Is it worthwhile for a small investor?

    Engineering in the service of your vision

    The patrimonial holding company is far more than a mere tax structure. It is an evolving legal structure that adapts to your ambitions. Whether you are in a phase of conquest (investment), consolidation (cash optimisation) or transfer, it brings an indispensable coherence to your wealth.

    However, the line between optimisation and risk is a fine one. Support from a chartered accountant and a wealth management adviser is the only bulwark against structuring errors.

    Ready to structure your family empire?

    Alexis Sagnier

    With more than 17 years of expertise in financial engineering, Alexis Sagnier guides directors and expatriates in securing their cross-border interests.

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    Sources & References:

    • French General Tax Code (CGI): Article 155 B.
    • Official Bulletin of Public Finances (BOFiP): Inbound-assignee regime (BOI-RSA-GEO-40).
    • 2025 Finance Act: Analysis of recent developments.
    • Case law on inbound assignment: Conseil d'État rulings on the reference remuneration.
    • ANACOFI Member Handbook: Standards for wealth engineering advice.

    Voir

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