In short…
The Luxembourg capitalisation contract combines two logics that nothing else brings together: the transferability by gift and the ownership by a company subject to corporation tax of the French capitalisation contract, and the uncapped protection plus the broader investment universe of Luxembourg. What most people miss is that it is the preferred wrapper of wealth-holding companies wishing to place significant cash on diversified investments while keeping maximum legal security. The tool of substantial, international wealth structured through a company.
- Transferable by gift while keeping its tax seniority, in full ownership or in dismemberment
- Luxembourg security, Triangle of Security and Super Privilege, uncapped protection where France stops at €70,000
- Ideal within a holding to place a corporation-tax company’s cash on dedicated funds, direct securities and multi-currency private equity
Simulate your Luxembourg capitalisation contract
Select your country of tax residence: the projection applies its exit taxation (Luxembourg is neutral). Your data is neither stored nor transmitted.
Luxembourg capitalisation simulator
The Luxembourg capitalisation contract: taxation according to your country of residence, transmission and the Triangle of Security.
Results are provided for purely illustrative and educational purposes, based on the parameters you enter and simplified assumptions (2026 taxation, constant return, excluding inflation). They constitute neither personalised investment advice, nor tax advice, nor an offer to subscribe. Some investments carry a risk of capital loss. Before any decision, speak with an advisor.
Why combine capitalisation and Luxembourg
Most directors who accumulate cash in a holding company leave it idle in a current account or place it on a handful of in-house funds offered by their bank. It is a considerable opportunity cost, and a counterparty exposure rarely measured. The Luxembourg capitalisation contract answers precisely this blind spot, by bringing together two bricks that are usually kept separate.
On the capitalisation side: transferability by gift, keeping the tax seniority, and the possible ownership by a legal entity subject to corporation tax. On the Luxembourg side: the protection of the assets (your holdings segregated from the insurer’s balance sheet, an uncapped Super Privilege) and an investment universe far wider than the French offering — dedicated funds, direct securities, private equity, multi-currency management.
The result is the preferred tool of wealth-holding companies that want to place significant cash on diversified, secure investments while preparing the transmission of the holding’s shares — and therefore, indirectly, of the contract — to the next generation. It is a structuring mechanism, not a simple investment.
The 3 levers reserved for wealth structured through a company
Lever 1 — placing holding cash without diluting it into the insurer’s balance sheet
A company subject to corporation tax — a holding, an SCI taxed under corporation tax — cannot take out life insurance, but can hold a capitalisation contract. In its Luxembourg version, the surplus cash is invested on dedicated funds and direct securities while remaining legally separated from the insurer’s balance sheet thanks to the Triangle of Security. For a director who has sold their business or accumulated cash, it is the combination of genuine diversification and uncapped protection, where the French guarantee stops at €70,000.
Lever 2 — transmitting the holding’s shares, and the contract with them
The Luxembourg capitalisation contract fits into an indirect transmission strategy: by gifting the holding’s shares (in full ownership or in dismemberment) to the next generation, you also transmit, indirectly, the contract it holds. The articulation with the parent-subsidiary regime, the contribution-disposal (article 150-0 B ter) and the gifting of the shares is built bespoke. This is precisely where wealth engineering creates the most value — and where standard bank distribution is absent.
Lever 3 — the investment universe and the multi-currency dimension
The Luxembourg contract gives access to underlyings unavailable in the French offering: internal dedicated funds steered by the manager of your choice, specialised insurance funds, direct securities, bonds, private equity, and management in several currencies. For a holding whose activity or holdings are international, the multi-currency dimension neutralises the currency risk, and the secured Lombard loan allows liquidity to be generated without divesting or triggering a surrender. A flexibility no classic cash investment allows.
Worked example — Jean-Marc, 59, director who has sold his company, holding in Luxembourg
Jean-Marc has sold his business and parked €1,200,000 of cash in his corporation-tax wealth-holding company. Rather than leaving it idle, he takes out a Luxembourg capitalisation contract held by the holding, invested in multi-currency dedicated funds at 4.5% net, with a view to a gradual transmission to his three children. Here is the projection:
| Criterion | Cash in a current account | Luxembourg capitalisation in a holding | Contribution |
|---|---|---|---|
| Capital projected at 12 years | ≈ €1,200,000 (eroded by inflation) | ≈ €2,040,000 | +€840,000 of potential |
| Asset protection | Bank counterparty risk | Triangle of Security, uncapped | Maximum security |
| Diversification | Virtually none | Dedicated funds, direct securities, private equity | Full universe |
| Transmission to the children | Via taxed disposal / liquidation | Gift of holding shares (dismemberment) | Seniority preserved |
Illustrative example — figures simplified for clarity and not contractual.
The cash that lay idle in a current account — exposed to inflation and counterparty risk — becomes a diversified asset, protected without cap, and set within a transmission logic. The projected capitalisation is purely illustrative, but the potential gap against inert cash is structural.
By gradually gifting the bare ownership of his holding’s shares to his three children, Jean-Marc indirectly transmits the contract at a value reduced by the usufruct scale, while keeping control and the income. It is the classic articulation — holding, Luxembourg capitalisation, dismemberment — that cannot be improvised and is built with an advisor.
Why combine capitalisation and Luxembourg
You add two logics together. On the capitalisation side: transferability by gift and the possible ownership by a company subject to corporation tax. On the Luxembourg side: the protection of the assets (your holdings segregated from the insurer’s balance sheet, an uncapped Super Privilege) and an investment universe far wider than the French offering (dedicated funds, direct securities, private equity, multi-currency).
It is the tool of choice for wealth-holding companies that want to place significant cash on diversified investments, while keeping maximum legal protection.
The brick of a holding strategy
For a director who has sold their business or accumulated cash in a holding, the Luxembourg capitalisation contract allows that cash to be invested in a diversified and secure way, while preparing the transmission of the holding’s shares (and therefore, indirectly, of the contract) to the next generation.
The articulation with the parent-subsidiary regime, the contribution-disposal (150-0 B ter) and the gifting of the shares is built bespoke — it is precisely the core business of a wealth advisor.
The upper brick of a holding strategy
This simulator applies the French taxation of a surrender after 8 years (Luxembourg being tax-neutral) and gives an order of magnitude for the capital. But the Luxembourg capitalisation contract cannot be reduced to these figures: it only makes sense set within a holding architecture, articulated with the parent-subsidiary regime, the contribution-disposal (150-0 B ter) and the gifting of the shares. It is a brick of wealth engineering, not an off-the-shelf product.
Balmont Conseil is an independent wealth-management firm, a member of ANACOFI, with no capital ties to a bank. This independence lets us select the Luxembourg company and the underlyings across the whole market, and build the holding / contract / transmission articulation in your sole interest. Let’s arrange a meeting to structure the investment of your corporate cash.
Frequently asked questions
Why hold a Luxembourg capitalisation contract in a holding?
Because a company subject to corporation tax cannot hold life insurance, but can hold a capitalisation contract. The Luxembourg version adds uncapped protection (Triangle of Security, Super Privilege) and a broader investment universe (dedicated funds, direct securities, private equity, multi-currency). For a director who has sold their business or accumulated cash in a holding, it is the way to put that cash to work in a diversified and secure manner, rather than leaving it idle in a current account.
How is this company-owned contract transmitted?
The transmission is done indirectly, via the holding’s shares. By gifting all or part of the company’s shares (in full ownership or in bare-ownership / usufruct dismemberment) to your children, you also transmit the contract the holding owns. The usufruct scale reduces the taxable base according to your age, and the contract’s tax seniority is preserved. The articulation with the parent-subsidiary regime and the contribution-disposal (150-0 B ter) is built bespoke.
Is the taxation different from the French version?
Luxembourg applies tax neutrality: it levies no tax of its own. For a French tax-resident structure, it is therefore French taxation that applies — that of a capitalisation contract owned by a legal entity subject to corporation tax, namely an annual flat-rate charge on a theoretical base, settled on surrender. The Luxembourg version brings no tax advantage in itself: its strength is uncapped legal security and the investment universe, not taxation.
From what amount is this solution relevant?
Like Luxembourg life insurance, the Luxembourg capitalisation contract becomes relevant from roughly €250,000, and more so beyond. It is aimed at wealth-holding companies and directors holding significant corporate cash to diversify and secure. Below that threshold, a French capitalisation contract in open architecture generally covers the need without the entry ticket and fees of a Luxembourg structure.
How does Balmont Conseil differ from a bank adviser for this structuring?
Balmont Conseil is an independent wealth-management firm, a member of ANACOFI, with no capital ties to a bank. Structuring a holding’s cash via a Luxembourg capitalisation contract — with the parent-subsidiary articulation, contribution-disposal and gifting of shares — is wealth engineering, not product distribution. A bank adviser does not offer this assembly. Our independence lets us select the company and the underlyings across the whole market and build the architecture that serves your sole interest.
Results are provided for purely illustrative and educational purposes, based on the parameters you enter and simplified assumptions (2026 taxation, constant return, excluding inflation). They constitute neither personalised investment advice, nor tax advice, nor an offer to subscribe. Some investments carry a risk of capital loss. Before any decision, speak with an advisor.