A capital gain on securities disposal in France (plus-value de cession de titres) is the difference between the selling price of shares and their acquisition cost (prix de revient) for an individual taxpayer. It is generally subject to the 30% flat tax (PFU) or, optionally, the progressive income tax rate with pre-2018 time-based allowances. For corporate taxpayers, the treatment depends on whether the shares qualify as long-term participations (plus-values à long terme).

For corporate taxpayers holding a participation of at least 5% in a subsidiary for at least two years, the long-term capital gain regime applies: only 12% of the gain is included in taxable income (the "quote-part de frais et charges"), resulting in an effective tax rate of approximately 3% (25% corporate tax rate × 12%). This near-exemption makes the holding company structure highly attractive for companies that sell subsidiaries — a key driver of the Franco-Swiss holding structure for serial entrepreneurs.

In Swiss law, capital gains on movable assets (including company shares) are generally exempt from income tax for individuals (Article 16 para. 3 LIFD) who are not self-employed as securities traders. For Swiss corporate taxpayers, the participation exemption (Beteiligungsabzug) exempts gains on participations of ≥10% (or ≥CHF 1 million) held for at least one year. This near-universal Swiss capital gain exemption is one of the most significant advantages of Swiss residency for business owners compared to the French 30% PFU.

At Hectelion, we advise on capital gain structuring across French and Swiss frameworks in our financial structuring and valuation mandates.