Interactive tool · 2026 Finance Act art. 7 — French Tax Code 235 ter C

Are you within the scope of the wealth-holding company tax?

6 questions to determine whether your wealth-holding company falls within the scope of the annual 20% tax introduced by the Finance Act for 2026 (French Tax Code art. 235 ter C). If so, immediate identification of the three restructuring architectures to examine before 31 December 2026.

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Under French Tax Code art. 235 ter C (Law no. 2026-103 of 19 February 2026, art. 7) · May 2026
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Understanding what is at stake

Article 235 ter C of the French Tax Code introduces an annual 20% tax on the fair market value of assets "not allocated to an operating activity" held by wealth-holding companies. Over 5 years, the cumulative charge equals 100% of the asset value (before the possible cap at 75% of income for individuals).

The EUR 5 million threshold of assets held by the company is the main trigger. Below it, the tax does not apply, so a prior demerger can neutralise the regime.

The correlative IFI (real-estate wealth tax) exemption (French Tax Code art. 975 VII, new) does not offset the economic effect: a 20% annual holding tax far exceeds the 1.5% annual IFI ceiling. Restructuring remains the only rational response.

— Interactive diagnostic

Are you within the scope of the 235 ter C tax?

Answer the 6 questions below. The diagnostic immediately identifies whether your holding company falls within the scope of the tax and suggests the appropriate restructuring actions.

Indicative diagnostic based on article 235 ter C of the French Tax Code (2026 Finance Act art. 7). Cumulative conditions of application: (1) French or foreign company subject to an equivalent corporate income tax, (2) overall asset value of EUR 5 million or more, (3) 50% or more held by an individual (together with close family, including through a trust), (4) passive income above 50%, (5) holding of targeted assets (yachts, art, precious metals, wines, horses, personal residences), (6) assets not allocated to a genuine economic activity. For a full audit (modelling of the three architectures, figures-based simulation, secured restructuring plan), contact the firm.

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Lead counsel: Jonathan Bensaid

Jonathan Bensaid, founding lawyer of the firm, advises UHNWIs, VHNWIs and family offices on the audit of their holding companies in light of the combined 235 ter C / 975 VII rules: figures-based modelling of the three architectures (status quo, removal of personal assets, allocation to an economic activity), preventive restructuring before 31/12/2026, defence in the event of a tax reassessment, and preparation of a priority constitutional review (QPC) strategy in the event of constitutional censure.

  • French Tax Code art. 235 ter C
  • French Tax Code art. 975 VII
  • 2026 Finance Act art. 7
  • Wealth-holding companies
  • UHNWI & VHNWI
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Audit your holding company before 31/12/2026

A confidential initial discussion. Figures-based modelling of the three architectures (status quo, removal of personal assets, allocation to an economic activity), choice of the optimal strategy, operational implementation.

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© BENSAID Avocats. This tool is educational and indicative. It does not constitute personalised legal advice. Sources: Law no. 2026-103 of 19 February 2026, art. 7; French Tax Code art. 235 ter C; French Tax Code art. 975 VII (correlative IFI exemption); Tax Procedure Code art. L. 64 (abuse of law). Entry into force: financial years ending on or after 31/12/2026. Last updated: May 2026.