Registration Duties When Buying a Business in France: What the Buyer Pays on Top of the Price

Registration duties when buying a business in France: what the buyer pays on top of the price

The price is not the buyer's whole bill. Every sale of a fonds de commerce above €23,000 triggers registration duties (droits d'enregistrement), owed by the buyer unless the deed shifts them: 3% on the slice of the price between €23,000 and €200,000, 5% above (CGI Art. 719). The scale is simple; everything around it is not. The duties are computed on a base that includes more than the stated price, charges the buyer assumes for the seller inflate it, while new goods usually escape it; a promise, a condition or the purchase of the walls with the business each changes the arithmetic; and two reduced regimes can cut the bill sharply: the zone regime for businesses in urban free zones and revitalisation areas, and a €500,000 allowance for sales to employees or family.

This guide covers the duties from liability to liquidation: when they become due, the scale and who pays, the base element by element, the charges that increase it and the sums that reduce it, the reduced regimes and their five-year commitments, and the presumptions that catch even undocumented sales.

When the duties are due: perfect, certain and current sales

The scope. Article 719 catches every transfer of ownership of a fonds or clientele for value, amicable or at auction, with two exceptions: purchases for resale by VAT-registered professionals, exempt where the deed carries a commitment to resell within five years (operating the fonds meanwhile is allowed; an incorporation, a transfer into a trust patrimony, a merger absorption or a gift before the deadline is not a resale and forfeits the regime); and purchases by local authorities under their own statutory framework.

A perfect sale. The duty attaches when the sale is perfect - mutual consent on the thing and the price (C. civ. Art. 1583). An imperfect agreement is a mere project, untaxed; a formally valid contract is taxed even if later annulled or rescinded, and even where the buyer immediately shuts the fonds without operating it.

Promises. A synallagmatic promise worth a sale is taxed as a sale - unless a condition precedent suspends it, in which case the duty waits for the condition. A unilateral promise is only an offer until the option is exercised: made privately, it must be registered within ten days of the beneficiary's acceptance (C. civ. Art. 1589-2), at the €125 fixed duty (CGI Art. 680); the proportional duty falls due at the option's exercise. The courts see through disguises: a promise granted with a location-gérance was held a sale where the royalties were abnormally low, the deposit matched the price, its instalments were in truth advances, and the break-fee was designed to reconstruct a genuine letting only if the sale failed.

Conditions. A sale under a condition precedent registers at the €125 fixed duty, the mutation duty falling due when the condition is met. A sale under a condition subsequent transfers ownership at once and pays the proportional duty - with no refund if the condition later undoes the sale.

The scale of the duties - and who pays them

The rates. Nothing on the first €23,000 (transactions within that figure pay a €25 minimum), 3% on the fraction between €23,000 and €200,000, and 5% on the fraction above €200,000 (CGI Art. 719) - each rate the sum of a state duty and departmental and communal surtaxes. The duties are assessed on the price plus the charges added to it (next sections), or on the real market value if higher.

Who pays. The buyer, unless the contract puts the duties on the seller - a clause with a price effect worth computing before signing, since duties sit on top of a price that may itself have been negotiated "costs included". Note the interaction the delivery of this series' deed guide covered: paying the duties is one of the buyer's closing costs under Article 1593 of the Civil Code, so a deed clause repeating that costs are the buyer's adds nothing - and adds nothing to the taxable base either.

The formality. The deed recording the sale must be presented for registration to the tax administration - the step that also starts several of the sale's other clocks, as this series' guides to the deed and the seller's declarations show. Where charges augmenting the price are not valued in the deed, the parties must file a detailed estimative declaration (CGI Art. 851); the same applies to the seller-assumed obligations that reduce the price.

Where do your duties land?

Pick your deal's shape - the check shows what drives the bill.

What the duties are computed on: the base, element by element

Clientele and lease right. The clientele is the base's core. The lease right, the sum paid to the seller (not the landlord) for stepping into the lease, is taxed with the fonds, and taxed at the Article 719 scale even where the lease right is sold alone (CGI Art. 725). It drops out where the buyer acquires the building with the fonds: a fonds sold with its walls is valued without the lease right.

Operating movables. Furniture, industrial equipment, tools and supplies sold with the fonds are in the base, everything mobile that serves the operation and is not held for resale, and must be listed in a detailed, itemised estimative inventory. One trap where the seller owned the walls: equipment placed by the owner for the building's service is immovable by destination (C. civ. Art. 524), so where fonds and building sell together those items pay the property-transfer duty (around 5.80% in most departments), not the fonds duty; sold with the fonds but without the building, they revert to movables in the fonds' base.

Ongoing contracts. Sums paid for the benefit of current contracts are in the base - including, in the case law, the value of boats ordered but undelivered, where the current shipbuilding contracts were among the elements sold.

New goods - the exemption. Goods destined for resale, transformed or not, escape the proportional duty where their sale bears VAT or is dispensed under Article 257 bis (CGI Art. 723) - in practice, almost always. The category is factual: a dealer's demonstration cars, a builder's formwork boards, a mushroom farm's growing beds, packaging handed over with the goods, a nursery's plants - all new goods; a bakery's flour is new goods while its heating fuel is supplies, a laboratory's reagents are supplies, and supplies stay in the taxed base. In the exceptional untaxed-VAT case, new goods pay a reduced 1.50% against a specific price and an item-by-item statement filed with the administration. And goods belonging to a tenant of the fonds, sold by the tenant to the fonds' buyer, are an ordinary sale of movables - €125 fixed duty if notarised or voluntarily registered, nothing otherwise.

What stays outside. Elements sold alongside but foreign to the fonds follow their own regimes: trade receivables, cash, securities - and the building, taxed at the property rate on its own price, with the ventilation between fonds and walls dictating each base.

Charges that increase the duties - and sums that reduce them

The principle. The duties are computed on the price plus every supplementary charge the buyer takes on for the seller - any indirect advantage procured to the seller, most often by paying charges or debts that were legally the seller's. Symmetrically, obligations the seller assumes in the buyer's place reduce the price. Where the sale includes new goods, charges are apportioned between the fonds' price and the goods'.

In the base. The case law and administrative practice add to the price: sale-preparation costs (publicity) the buyer reimburses; the seller's direct taxes for the period before the buyer's entry into enjoyment, where assumed; the buyer's reimbursement to the seller of VAT the seller had paid on the transferred fixed assets; a pre-sale dismissal indemnity the buyer takes over; holiday pay assumed for pre-sale periods; an indemnity for the seller's help in renewing a concession; the seller's reserved enjoyment of the fonds where the price is already payable or interest-bearing; and the balance of the seller's property loan taken over by the buyer.

Not in the base. The deed's costs and the duty itself - the buyer owes them by law (C. civ. Art. 1593), so a clause restating it adds nothing; an intermediary's commission contractually placed on the buyer in the mandate, whoever the principal (only a seller-owed commission paid by the buyer counts as a charge); the buyer's reimbursement of rents the seller paid in advance; a salary paid to the seller under a genuine service arrangement; and a claim on the seller the buyer later writes off, absent any concealment of price. Deals done "contrat en mains", the seller bearing the contract costs, have their own deduction rules.

The estimative declarations. Charges not valued in the deed require a detailed estimative declaration (CGI Art. 851) - and so do the seller-assumed obligations claimed as price reductions.

Paying less duties: zones, employees and family

The zone regime (CGI Art. 722 bis). A fonds located in an urban free zone (ZFU-territoire entrepreneur) or a rural revitalisation zone, the France Ruralités Revitalisation zoning that replaced the ZRRs from 1 July 2024, pays a reduced scale: the state duty on the €23,000–€107,000 fraction falls to zero, leaving 1% of surtaxes on that slice (then 3% to €200,000 and 5% beyond). The conditions: the buyer commits, in the deed, to maintain the operation of the fonds for five years from the acquisition - whoever operates it, the buyer, a successor or a tenant; an omitted commitment can be repaired by a complementary act registered at €125 within the claims period. Successive buyers within the five years can take the reduced rate on their own five-year commitment - but if operation stops within anyone's window, the defaulting acquirers repay the duty saved plus late interest of 0.20% per month; force majeure excuses. The regime sits under the EU de minimis ceiling, and the zone classifications and the regime's own temporal scope evolve with the finance laws - a deal-by-deal check, not an assumption.

The employee-and-family allowance (CGI Art. 732 ter). Sales in full ownership of an individually-operated fonds to qualifying buyers carry an allowance of €500,000 on the taxable value - the level set by the 2024 finance law (older material shows €300,000). Qualifying buyers: an employee holding a full-time permanent contract for at least two years with the selling business (the administration accepts a two-year employee whose first contract was not permanent), an apprentice under a current contract - or the seller's spouse, civil partner, direct-line ascendants or descendants, brothers or sisters; a single-member company (EURL, SASU and equivalents) formed by one of them also qualifies. Where the seller had bought the fonds, it must have held it over two years; no holding period applies to a created or inherited fonds. The buyer commits to pursue the operation, effectively, continuously and as its sole professional activity, for five years, with effective direction (changing the activity is allowed; on a joint purchase, direction may rotate with gaps of up to three months). The allowance applies once per seller-buyer pair, and any unused remainder is lost - but on an undivided purchase each co-buyer gets its own allowance: a €1,100,000 fonds bought half-and-half by two qualifying buyers is taxed on €50,000 per head (€550,000 − €500,000). Clawback follows a broken five-year commitment - with carve-outs for an incorporation into a company wholly held by the beneficiaries whose shares are kept through the period, a judicial liquidation, and force majeure (accident, invalidity, death, expropriation).

Do you qualify for reduced duties?

Pick your case - the check gives the regime and its conditions.

No deed, no escape: the presumptions that catch the duties

The duties do not depend on paperwork. Where a business changes hands without a written sale, the administration can establish the mutation by legal presumption: the buyer's inscription on the CFE roll and at least two tax payments under it suffice to prove the transfer - usually corroborated by taking possession or by the lease granted to the new operator. The case law's illustration: a company that wrote to its clients announcing a successor, whose successor then appeared on the business-tax roll, was presumed transferred - with the burden of contrary proof on the parties. The presumption bends only for error: facts showing the newcomer created its own fonds, or that two traders merely occupied the same premises in succession. The same presumptions prove a retrocession, the original seller back on the roll, acting as owner, and a retrocession itself evidences the earlier cession. The message for informal arrangements is blunt: operating a fonds you "informally" took over builds the tax file against you month by month.

Frequently Asked Questions

This article is for general information only and states French law as published in the sources available at the date shown above, updated against official sources for current rates and thresholds. It does not constitute legal or tax advice. Always seek qualified advice before committing.