Philanthropy and charitable giving

A gift by an individual to a public-interest body entitles the donor to an income tax reduction of 66% of the amount given, up to 20% of taxable income (article 200 of the French Tax Code). Where payments exceed this ceiling, the excess is carried forward over the following five years. For gifts to bodies assisting people in hardship (provision of meals, housing or care, the so-called "Coluche" scheme), the rate is increased to 75% within a specific annual ceiling set by statute. The reduction is conditional on the beneficiary body issuing a compliant tax receipt.

A company making a gift to a charity or a public-interest body benefits from a 60% tax reduction on the amounts given (article 238 bis of the French Tax Code), lowered to 40% for the portion of gifts exceeding 2 million euros. The reduction is capped at 20,000 euros or 0.5% of turnover excluding VAT, whichever is higher. Any excess is carried forward over the following five financial years. Patronage, which expects no equivalent advertising benefit in return, is distinct from sponsorship, which is treated as a deductible expense rather than a tax reduction.

Yes. Gifts to certain bodies, in particular State-recognised public-interest foundations and research or teaching institutions, entitle the donor to an IFI reduction equal to 75% of the payment, capped at 50,000 euros (article 978 of the French Tax Code). The same payment cannot qualify for both the IFI reduction and the income tax reduction under article 200: depending on the circumstances, a choice must therefore be made between the two schemes.

The endowment fund (Act no. 2008-776 of 4 August 2008, article 140) is quick to create, by simple declaration to the prefecture, with flexible governance; it suits a commitment that the donor wishes to launch without institutional formality. The State-recognised public-interest foundation requires a substantial endowment and a decree issued by the Conseil d'État: a more demanding framework, but one with strong legitimacy and the capacity to receive bequests. The sheltered foundation, housed under the aegis of an existing foundation, allows action without creating a standalone structure. The choice depends on the time horizon, the resources and the degree of family governance sought. See our dedicated page on foundations and endowment funds.

Yes. Gifts and bequests to eligible charities, foundations and bodies are exempt from gift and inheritance duties (article 795 of the French Tax Code). This exemption covers, in particular, State-recognised public-interest foundations meeting certain conditions, endowment funds whose statutes provide that the endowment may not be consumed, and public or public-interest institutions pursuing a disinterested purpose. A bequest to a foundation or an endowment fund is therefore a tool for making family philanthropy permanent, to be carefully articulated with forced heirship rules.

The tax benefit requires the body to have public-interest status: disinterested management, a predominantly non-profit activity, and no operation for the benefit of a restricted circle of persons. Eligible bodies include charities and organisations of a philanthropic, educational, scientific, social, humanitarian, sporting, family or cultural nature, as well as eligible foundations and endowment funds. In case of doubt, the body may apply for an advance tax ruling to secure its eligibility before issuing receipts.

Yes. A gift qualifying for the reduction may take the form of a cash payment, but also a gift in kind, such as securities, works of art or real property, a waiver of income or proceeds (rents, royalties), or expenses incurred by volunteers who forgo reimbursement. A gift in kind requires a rigorous valuation, under the donor's responsibility, which determines the basis of the reduction. Certain gifts of securities or works of art call for a specific analysis with regard to capital gains and valuation.

Lasting family philanthropy relies on the articulation between a dedicated vehicle (an endowment fund or a foundation) and the succession strategy. A permanent vehicle can receive gifts and bequests exempt from duties (French Tax Code art. 795), involve the next generations in its governance, and ring-fence part of the family wealth in the service of a cause. The structuring must respect forced heirship rules and be articulated with the other wealth-planning tools: gift-partition, dismemberment of ownership, asset-holding company, fiducie. A comprehensive analysis, specific to each family, is essential.