The hereditary reserve (réserve héréditaire in France, Pflichtteil in German-speaking Switzerland) is the share of an estate that law mandatorily reserves for certain heirs — primarily children and, in some cases, the surviving spouse — which cannot be disposed of freely by the deceased. The freely disposable portion (quotité disponible) is the remainder that can be bequeathed to anyone. Both France and Switzerland have hereditary reserve rules, though their scope and calculation differ significantly.

In France, the hereditary reserve depends on the number of children: one child reserves 50% of the estate, two children 66.7%, three or more children 75%. In Switzerland, the Pflichtteil is currently set (after the 2023 reform) at one-half of the statutory share for descendants and the surviving spouse. The Swiss reform significantly reduced the reserve, increasing the freely disposable portion and giving Swiss testators much greater freedom than their French counterparts.

In a business transfer context, the hereditary reserve creates a challenge when the business owner wishes to transfer the company to a single heir (the successor) while protecting the others. The mechanisms to manage this tension in France include: the Pacte successoral (renunciation of inheritance for reduction, RAAR), the inclusion of the business in the Pacte Dutreil structure, and donations to non-successor children of non-business assets of equivalent value. Each approach requires precise valuation of the business assets to verify that the reserve is respected.

At Hectelion, we value business assets for hereditary reserve calculations and succession planning in our valuation mandates across France and Switzerland.