If you have been tax-resident in France for at least 6 of the last 10 years and you leave holding shares worth more than €800,000 in total, or at least 50% of a company, France calculates tax on the gain you have not yet cashed in. This is the French exit tax. In 2026 it is 31.4% of the unrealised gain. In most cases you pay nothing when you leave: the tax is deferred, automatically within the EU and for a list of countries including the UK and the US, and on request with a guarantee elsewhere. It is cancelled if you keep the shares for 2 years after leaving (5 years above €2.57 million).
Key facts
| Question | Short answer |
|---|---|
| Who is caught | French tax residents for at least 6 of the 10 years before departure |
| Thresholds | Shares worth more than €800,000 in total for the household, or at least 50% of a company |
| What is taxed | Unrealised gains on shares, earn-outs still to be received, gains deferred after a contribution to a holding company |
| Rate in 2026 | 31.4% (12.8% income tax plus 18.6% social charges) |
| Moving within the EU | Automatic deferral, no guarantee |
| Moving outside the EU | Automatic if the country is on the official list (UK, US, Japan...); otherwise (Switzerland, UAE, Canada...) deferral on request, with a guarantee, at least 90 days before leaving |
| When the tax is cancelled | Shares kept for 2 years (5 years above €2.57m), return to France, death |
| When it becomes payable | Selling the shares during the deferral, receiving an earn-out payment |
Three questions to see if this applies to you
- Have you been French tax-resident for at least 6 of the last 10 years? The years need not be consecutive, and years under the French impatriate regime count.
- Are your shares worth more than €800,000 in total, or do you hold at least 50% of a company? The whole tax household counts, listed and unlisted shares, investment funds and shares held through a holding company. Life insurance (assurance-vie) does not.
- Are you still due an earn-out from a past sale, or did you contribute shares to a holding company? These gains are caught even below the thresholds.
Yes to the first question and to one of the other two: the exit tax applies when you leave. You will have to report it, even if you pay nothing.
What is taxed: a gain you have not cashed in
For each holding, the value on the day you leave is compared with what you paid for it. Shares standing at a loss do not reduce the bill.
A point many expats miss: the gain built up before you moved to France is taxed too. The original purchase price counts, not the value on arrival.
Example. An American executive moves to Paris in 2018 with shares bought for €200,000 and already worth €600,000. In 2026 they are worth €1.1 million and he moves to London. The taxable gain is €900,000, not €500,000: the tax calculated is about €282,600. Because the UK is on the list, it is deferred with no guarantee.
Another example. A founder subscribed her shares for €10,000. When she moves to Portugal in 2026, her stake is worth €3 million. The tax calculated is about €938,900. She pays nothing on departure, but because her shares are worth more than €2.57 million, the tax is cancelled only if she keeps them for 5 years.
A founder can cross the threshold without ever having sold a share: unlisted shares count at their real value, often assessed against the last funding round.
Leaving for the EU or elsewhere: the difference
- The EU, and countries on the official list: deferral is automatic, with no guarantee and nothing to file before you leave. The list is published in the notice to form 2074-ETD. For recent departures it includes, among others, the UK, the US, Norway, Japan, Australia, India, Morocco and Turkey.
- Other countries, including Switzerland, the UAE, Canada, Israel, Singapore and Hong Kong: deferral must be requested at least 90 days before leaving, with a tax representative in France and a guarantee (bank guarantee, mortgage or pledge). In the founder's example, the guarantee would come close to the full tax, about €940,000.
Switzerland is the most common case, and the most dangerous: a taxpayer who requested deferral only after leaving was refused it. The list changes every year and should be checked before you fix a departure date.
What cancels the tax, and what makes it payable
The tax is cancelled:
- 2 years after departure, if you still hold the shares;
- 5 years after departure, if your shares were worth more than €2.57 million;
- earlier, if you return to France, die, or give the shares away while living in the EU or a listed country.
It becomes payable if, during that period, you sell the shares or receive an earn-out payment. If you sell for less than the departure value, the tax is reduced. Earn-outs and deferred holding-company gains are not cancelled by time.
After you leave: three rules
- In the year after departure, you report the gain with your income tax return, on form 2074-ETD.
- You notify your new address within two months of each move. A missed filing can make the deferred tax payable at once.
- Cancellation after 2 or 5 years is not automatic in practice: you must claim it and prove you still hold the shares.
When it gets complicated
- You plan to sell soon after leaving. The timing of departure, sale and the tax treaty with your new country decides what you pay, and where.
- Your shares sit in a holding company. A reorganisation just before departure can create a deferred gain that is never cancelled. The 2027 French budget bill, still under debate, would also tighten the rules on gifts of holding-company shares.
- Your company is unlisted. You declare its value, and the tax authorities can challenge it.
- You hold free shares, stock options or BSPCE. They follow their own rules and need a separate review.
- You are moving outside the EU to a country not on the list. The guarantee has to be in place before you leave, not after.
- You may come back. Returning within the period cancels the tax, but not after a sale.
The amounts at stake often run to hundreds of thousands of euros, and most mistakes come from timing: a departure, sale or gift made a year too early.
Planning to leave France with shares or a company? A short consultation is enough to see whether the exit tax applies and which deferral you get.
Frequently asked questions
Does the French exit tax apply to startup shares?
Yes. Unlisted shares count at their real value on the day you leave, often assessed against the last funding round. A founder can be caught without ever having sold.
How many years of residence before it applies?
At least 6 years of French tax residence in the 10 years before departure, consecutive or not.
Can I avoid the exit tax by moving within the EU?
No, it is calculated and reported. But deferral is automatic, and the tax is cancelled if you keep the shares for 2 years (5 years above €2.57 million).
Do I pay anything on the day I leave France?
Usually not. Unless you move to a country that is not on the list without requesting deferral in time: the tax is then due immediately.
Related reading
- French inheritance tax: rates, treaties, forced heirship
- Gifting to your children in France: allowances and lifetime gifts
- France's 20% tax on homes, yachts and cars held through companies
- The French impatriate regime
Two ways to move forward
You are planning to leave. You hold shares, a company or an earn-out, and want to know whether the exit tax applies, which deferral you get, and in what order to organise departure, sale or gift. Book a consultation.
You have already left. You need to file the exit tax, follow the deferral or claim cancellation, or you are considering a sale or a return. Describe your situation and you will receive a proposal for full assistance.
General information under French law as at 1 November 2026. It is not legal advice for your situation.