Tax integration: definition and operation

Updated April 2026 - Fiscal integration is a mechanism which allows a group of companies to merge their taxable results into a single base, at the level of the parent company. Concretely, the losses of one subsidiary reduce the profits of another, which reduces the overall corporate tax burden. In 2026, with a normal IS rate of 25%, the potential gain is significant for groups that present heterogeneous results profiles.

Direct answer: tax integration is an optional régime open to groups whose parent company holds at least 95% of the capital of its French subsidiaries subject to IS. It makes it possible to compensate for loss-making and profitable results within the same tax perimeter, generating substantial tax savings. The régime is governed by articles 223 A to 223 R of the General Tax Code and governed by the BOFiP doctrine. The option is irrevocable for five years.

To put the subject in perspective, you can also read our guide on holding and tax optimization, our article on the contribution of securities to a holding and our file on the distribution of dividends.

Fiscal integration, sometimes called "fiscal consolidation" in common parlance, is a French tax régime distinct from accounting consolidation (IFRS or PCG). It authorizes a French parent company to replace its subsidiaries for the calculation and payment of corporate tax.

Concretely, the parent company files a déclaration of overall results (form 2058-SD) which aggregates the results of all the companies in the scope. Each subsidiary continues to keep its own accounts and submit its individual tax return, but it is the parent which pays the overall corporate tax.

The mechanism is based on three pillars:

• the automatic compensation of profitable and déficit results;
• the neutralization of certain intra-group operations (dividends, capital gains from the sale of securities);
• the single payment of the IS by the parent company.

This régime only concerns corporate tax. VAT, CVAE and other taxes remain due by each entity individually.

To validly opt for tax consolidation, the group must meet strict cumulative conditions, as defined in article 223 A of the CGI.

The integral parent company#

The parent must be a company subject to corporate tax at the standard rate. It can take the form of an SA, an SAS, an SARL or any other subject social form. Tax transparent companies (SCI with IR, non-optioned SNC) cannot play this rôle.

The 95% holding threshold#

The parent company must hold at least 95% of the capital of each integrated subsidiary, directly or indirectly. This threshold is assessed continuously: if ownership falls below 95% during the financial year, the subsidiary leaves the scope as of the financial year concerned.

Indirect ownership is permitted: a parent which owns 100% of a sub-holding, itself the holder of 95% of a subsidiary, can integrate the latter. On the other hand, cross-ownership or minority participation blocks eligibility.

French subsidiaries subject to IS#

Only French companies (or established in an overseas department) subject to IS can be integrated. Foreign subsidiaries, even 100% owned, are excluded from the scope. Subsidiaries subject to a special régime (SIIC, investment organizations) are not éligible either.

The formal option#

Tax integration is not automatic. The parent company must exercise an express option with the tax service, by attaching the list of integrated subsidiaries to its income statement. The option is granted for five years minimum and is then tacitly renewed.

The calculation mechanism follows a three-step logic.

Step 1: détermination of individual results#

Each company in the group determines its own tax result, as if it were independent. This is the essential starting point. Reliable company-by-company accounting is therefore a non-negotiable prerequisite.

Step 2: reprocessing and neutralization#

The overall result is not a simple addition. It includes specific adjustments:

• neutralization of dividends received from integrated subsidiaries (articles 223 B and 216 of the CGI);
• carry forward of capital gains from the sale of securities between integrated companies;
• reintegration of provisions for depreciation of securities of integrated subsidiaries;
• adjustments linked to merger operations or partial transfer of intra-group assets.

These restatements aim to avoid economic double taxation within the group.

Step 3: taxation of consolidated net income#

The overall result, after restatements, is taxed at the standard rate of 25% (2026). The parent company pays corporate tax for the entire group. IS advance payments are calculated on the basis of the overall result of the previous financial year.

The diet has undeniable advantages, but it is not systematically relevant.

The advantages#

• immediate tax savings: the déficits of a subsidiary directly reduce the tax base of the group. For a déficit of €500,000, the saving is €125,000 (500,000 × 25%);
• simplification of payment: a single tax contact, a single IS payment;
• better visibility on the group's overall tax burden;
• cash flow optimization: losses are valued immediately instead of being carried forward by the loss-making subsidiary.

Limits and costs#

• important formality: déclaration 2058-SD, annexes, monitoring of restatements year after year;
• compliance cost: maintaining the tax integration file requires advanced technical skills;
• five-year commitment: the option is irrevocable during this period, which limits flexibility in the event of restructuring;
• risk of increased tax control: integrated groups are subject to particular attention by the administration, particularly with regard to transfer prices and intra-group operations.

Hayot Expertise Advice: tax integration is only relevant if the group is managed as a group. If companies live like silos, without financial coordination or consolidated vision, the régime generates formalism without creating value. We systematically recommend numerical modeling before optioning.

The support of a chartered accountant is often decisive for the successful implementation and monitoring of a tax integration régime.

Upstream: feasibility study and modeling#

Before any option, the accountant carries out:

• an eligibility diagnosis of the scope (capital holding, legal form, tax régime of each entity);
• a modeling of the overall result based on the accounts for the last three financial years;
• a quantified comparison between the integrated scenario and the separate scenario, including compliance costs.

This phase is crucial. It allows us to objectively resolve the question: does fiscal integration create value for this specific group?

During the option: creation of the file and submission#

The accountant prepares the 2058-SD déclaration, establishes the restatement tables and ensures that the option is exercised within the legal deadlines (before filing the parent company's income statement).

Annual monitoring: day-to-day management and monitoring#

Each financial year, the accountant:

• updates the reprocessing monitoring table;
• checks the consistency of individual results before aggregation;
• anticipates the impacts of securities movements (entry or exit of a subsidiary from the scope);
• ensures regulatory monitoring (developments of the CGI, case law, BOFiP doctrine).

Fiscal integration can be combined with certain systems, but specific rules apply.

Tax integration and mother-daughter régime#

The mother-daughter régime (article 145 of the CGI) and tax integration are incompatible for the same titles. Within an integrated group, intra-group dividends are neutralized by the very mechanism of integration. The parent-daughter régime retains its interest for investments held outside the integrated scope (ownership less than 95%).

Fiscal integration and vertical integration#

In a multi-level group (parent → sub-holding → subsidiaries), tax integration can be structured in two ways:

• horizontal integration: the parent directly integrates all éligible subsidiaries;
• cascade integration: the sub-holding integrates its own subsidiaries, then the parent integrates the sub-holding.

The choice of the structure has a direct impact on the overall result and deserves a case-by-case analysis.

In 2026, fiscal integration remains a powerful lever for French groups of companies. With a corporate tax rate of 25%, offsetting results within the same scope can generate substantial tax savings. But the régime requires impeccable accounting quality, rigorous tax management and solid technical support.

The decision to opt should never be automatic. It is based on a quantitative analysis of the scope, an assessment of compliance costs and a clear vision of the group's strategy.

(Official sources: articles 223 A and 223 R of the General Tax Code, BOFiP BOI-IS-GPE-10-30-10 on the group régime, form 2058-SD)