Dutreil Pact: securing the 75% relief in 2026

Quick answer. The Dutreil Pact (CGI art. 787 B) exempts 75% of the value of company shares transferred by gift or inheritance. For transfers from 21 February 2026, the 2026 Finance Law extends the individual holding commitment from 4 to 6 years (8 years in total) and excludes assets not used for the operating activity.

The Dutreil Pact remains the most powerful tool for passing on a family business at a contained tax cost. But the benefit is never automatic: it rests on a framework of holding commitments, management duties and asset-allocation rules that the French tax authority checks closely. The 2026 Finance Law tightened several of these conditions. We explain here, from a strictly tax angle, how the 75% relief is calculated, what changes in 2026, and where the breaches that forfeit the benefit actually occur.

Article 787 B of the French Tax Code exempts from transfer duties, up to 75% of their value, the shares of a company carrying on an industrial, commercial, craft, agricultural or professional activity, transferred by gift or inheritance. In practice, only 25% of the value of the shares enters the taxable base.

This relief does not eliminate the duties: it sharply reduces the taxable base. On a company valued at 4 million euros, the taxable base falls to 1 million euros before the standard allowances and the progressive scale. That reduced base is what makes early transfers affordable for many families.

The regime rests on three cumulative pillars: an eligible activity (operational, not the mere management of personal wealth), holding commitments on the shares, and the exercise of a management function. Failing any of these forfeits the relief, sometimes retroactively. If you are preparing a transaction, our support for business transfers helps you validate every condition upfront.

The scheme is built around two successive commitments. The first is the collective holding commitment: the signatory shareholders undertake to keep their shares for a minimum of 2 years. This commitment must cover at least 17% of financial rights and 34% of voting rights for an unlisted company (10% of financial rights and 20% of voting rights for a listed company).

The second is the individual commitment: each recipient of the transfer in turn undertakes to keep the shares received. This is the duration the 2026 Finance Law hit.

What the 2026 Finance Law changed#

For transfers from 21 February 2026, the individual holding commitment rises from 4 to 6 years. The minimum total holding duration therefore moves from 6 to 8 years: 2 years of collective commitment (at least) followed by 6 years of individual commitment. This extension reshapes the horizon of the deal: an owner who once expected to be free after six years must now plan for eight.

A second major change is the exclusion from the relief base of assets not exclusively used for the operating activity. Excess cash, residences, passenger vehicles, pleasure boats, certain works of art, wines and spirits, or racehorses no longer benefit from the 75% relief for the share of value they represent. These assets must have been exclusively used for the business activity for at least 3 years before the transfer, or since their acquisition.

A Dutreil Pact is not signed on the day of the gift. It is prepared. Here is the sequence we recommend in family-transfer files:

1. Audit the company's activity to confirm its operational nature and identify personal-wealth assets to isolate.
2. Check that the financial-rights and voting-rights thresholds are met over the required period.
3. Enter into the collective holding commitment, or assess whether it can be deemed acquired.
4. Designate the person who will hold the management function during the collective-commitment phase and after the transfer.
5. Carry out the gift, ideally in full ownership before the donor turns 70 to combine the 50% reduction in duties.
6. Subscribe the individual commitment and organise documentary tracking over the entire holding period.

The owner's wealth strategy must integrate this timeline alongside the family's civil calendar. To combine the gift with a fair split among heirs, the shared-gift arrangement remains the reference tool.

This is the most frequent and most costly trap. A holding company, whose activity is financial by nature, is not eligible for the Dutreil relief. Unless it is an active holding of its group: it must then actively take part in steering the group's policy and controlling its subsidiaries, beyond the mere management of shareholdings.

The tax doctrine (BOFiP BOI-ENR-DMTG-10-20-40) requires real and demonstrable involvement: effective management, signature of essential documents, sustained contact with key clients or suppliers. The animating role must be proven, not asserted. A holding that merely collects dividends and manages an investment portfolio will not survive an audit.

We cover the structuring and pitfalls of the ownership vehicle in our article on the family holding, and the holding taxation day to day in our dedicated offer. The active-holding status is assessed at the date of transfer and must be maintained throughout the holding commitments.

Yes, and that is in fact its most relevant use. The Dutreil Pact applies to transfers free of charge, whether an inheritance or a gift. The gift offers a decisive additional advantage.

Article 790 of the French Tax Code grants a 50% reduction in gift duties when the gift concerns full ownership of the shares and the donor is under 70. This reduction combines with the 75% relief. Note: it is excluded if the gift concerns split ownership, for example a gift of bare ownership only.

Combining these levers, anticipated several years ahead, radically changes the cost of a transfer. That is why we stress the personal review and transfer timeline ahead of any gift.

The deemed-acquired commitment removes the need to sign a formal collective commitment: it is recognised when a person has held the required thresholds for at least 2 years and has carried on their main activity or a management function for 2 years. This is common among owners holding their company since inception. But it weakens a direct inheritance transfer, since death ends the deceased's exercise of those functions.

In all cases, one of the heirs, donees or legatees must hold a management function during the 3 years following the transfer. For interposed companies (ownership through one or more companies), the shareholdings must remain unchanged at each level throughout the commitments.

Professionals operating through a company can also use the Dutreil Pact, provided the activity is eligible. The later sale of the shares received falls under a separate regime that we detail in our article on the sale of shares.

The underestimated risk. The danger lies less in entering the scheme than in breaching it along the way. A share sale during the commitment, a poorly calibrated contribution, the loss of the management function, and the benefit collapses, with the duties and late interest reclaimed. With the individual commitment now at 6 years, the window of fragility mechanically lengthens.

What the tax authority looks at. Audits focus on three areas: the reality of the operating activity, proof of the animating role for holdings, and continuous compliance with the commitments. Personal-wealth assets held inside the company are now scrutinised from the first euro, since the exclusion introduced in 2026. Excess cash not used in the business is a classic signal of partial reintegration into the base.

Our reading is clear: the 2026 reform does not kill Dutreil, it rewards genuinely prepared transfers and penalises opportunistic structures. The move to 8 years and the exclusion of personal-wealth assets push owners to clean up the balance sheet before the gift, rather than transfer a shell inflated with investments.

Recently, the owner of an industrial SME asked us to pass the company to his two children. His holding contained an investment portfolio representing nearly half of the assets. As it stood, a substantial share of the value would have been excluded from the relief under the new regime. We worked upstream on asset allocation and on documenting the animating role, alongside his notary, to make the transaction robust before 21 February 2026 and beyond.

As a chartered accountant registered with the French Order and a statutory auditor, we believe the value of Dutreil lies in documentary rigour: articles, minutes, evidence of the management activity, annual monitoring of commitments. It is this evidence file, built from the outset, that withstands an audit ten years later. The tax support we offer is built precisely around this traceability.

Hayot Expertise tip. Never sign a Dutreil Pact without auditing the eligibility of the activity, the allocation of assets and the animating role of the holding. Anticipate the gift several years before the intended transfer to combine the 50% reduction before 70. And document each commitment year after year: the audit comes later, the file must already exist.