What an SPI actually is
A société à prépondérance immobilière, SPI for short, is a tax label, not a corporate form. Any company, French or foreign, listed or private, opaque or transparent, can be an SPI the day its balance sheet tips over the 50 per cent real-estate threshold. The label attaches independently of the articles of association, independently of the commercial register, and independently of how the company is taxed on its ordinary income. Its only purpose is to answer one question: when a shareholder sells shares in this company, should France tax the gain as a real-estate gain or as a securities gain? For non-residents, the consequences of the answer are financial, not cosmetic, because the two regimes carry very different rates, bases, and filing mechanics.
The 50 per cent asset test and the 12-month look-back
The test is quantitative. On the sale date, or at any moment during the preceding twelve months, does French real estate, directly or indirectly held, represent more than half of the gross asset value of the company? If yes, SPI. If no, not SPI. Two refinements matter. First, real estate held by a subsidiary is counted proportionally to the parent's stake, so interposing a holding layer does not launder the characterisation. Second, real estate used by the company itself for its own industrial or commercial operations is excluded from the ratio, which is why trading companies with a French head office and a small residual commercial property rarely qualify. For non-operational civil-estate vehicles, the ratio is almost always above 50 per cent by construction, which is why the SPI question matters first and foremost to SCIs, to real-estate SAS, and to the offshore holdings that sit on top of them.
View data as table
| Component | SPI regime | Non-SPI regime |
|---|---|---|
| Income-tax CGT | 19% | 12.8% (PFU) |
| Social charges | 17.2% | 17.2% |
| Registration stamp, buyer | 5% | 0.1% |
Rates applied and duties paid
Once the SPI characterisation sticks, the rate stack mirrors a direct property sale. Income-tax CGT at 19 per cent on the taxable gain, social charges at 17.2 per cent (7.5 per cent for sellers covered by a European social-security scheme, post-2019 ruling), and the high-gain surtax on a sliding scale from 2 to 6 per cent once the taxable gain crosses €50,000. Holding-period relief applies on the same 22 and 30 year tapers, computed from the acquisition date of the shares, not the underlying property. On top of the seller-borne taxes, the buyer pays 5 per cent registration stamp duty on the purchase price of the shares, compared with 0.1 per cent on an ordinary share deal; that gap alone often pushes buyers to negotiate the price down when the target is an SPI.
Where the representative rule plugs in
The accredited-representative obligation tracks the SPI regime precisely. If the share sale is caught by Article 244 bis A (because the company is an SPI and the seller is a non-EU, non-EEA, non-Swiss resident) and the share price exceeds €150,000, the non-resident seller must appoint an accredited firm before the share transfer deed is registered. The representative files form 2048-IMM bis in place of the 2048-IMM used on direct sales, computes the CGT, pays it to the Service de la Publicité Foncière, and issues the tax-clearance certificate that unblocks the sale proceeds. When the seller is EU or EEA resident, or when the price is below €150,000, the obligation falls away, but the CGT is still due and the seller files via the regular non-resident return.
Worked example
A UAE-resident holding company sells a 100 per cent stake in a Luxembourg SARL whose sole asset is a Nice villa worth €2.4 million. Share price, €2.5 million. The SPI test is met (real estate is 96 per cent of the SARL's gross assets on the sale date). The seller is non-EU, the price exceeds €150,000, an accredited French representative is mandatory. Acquisition cost of the shares in 2018, €1.8 million. Gross gain, €700,000. Eight years of holding yields a 12 per cent taper on CGT and about 3 per cent on social charges, so taxable base is €616,000 for CGT and €679,000 for social charges. Income-tax CGT at 19 per cent, €117,040; social charges at 17.2 per cent, €116,788; high-gain surtax, roughly 5 per cent blended, €30,800; total seller tax, €264,628. On top, the buyer pays €125,000 in 5 per cent registration stamp duty. Net to seller after representative fee, roughly €2.23 million.
Pitfall to avoid
The pitfall is misreading the twelve-month look-back. Sellers look at the balance sheet on the sale date, see real estate at 48 per cent because a recent cash injection has diluted the ratio, and conclude that the SPI characterisation is off. It almost never is. The administration tests the ratio on every month-end of the preceding twelve months; if any one of those snapshots crossed 50 per cent, the characterisation applies. Cash parked in the company late in the pre-sale window is treated as temporary and routinely reattributed to the real-estate side by the administration, especially when the cash is withdrawn shortly after the sale. Expecting the look-back to save a deal almost always fails.
Pro tip
When the target of the sale is a chain of holdings, a foreign top-co owning a foreign mid-co owning a French SCI, get the representative to produce a consolidated SPI test, top to bottom, before the term sheet is signed. The transparency mechanism means the SPI characterisation cascades up the chain; the French property at the bottom can make the Jersey top-co an SPI for French purposes even when its own balance sheet looks financial. Buyers rarely know this, and it is the single most useful piece of diligence a seller can deliver to the deal table, because it reframes the stamp-duty conversation and often moves the price by one or two points.
Key takeaways
- SPI is a tax label, triggered by a gross-value asset test with a twelve-month look-back.
- SPI share sales are taxed like property sales: 19 per cent CGT, 17.2 per cent social, surtax, tapers.
- Buyers pay 5 per cent registration stamp on SPI share deals, versus 0.1 per cent otherwise.
- Representative rule tracks the SPI regime plus the €150,000 per-seller threshold.
- Pre-sale rebalancing almost never escapes the look-back; treat the characterisation as given.
Frequently asked questions
Does the SPI test apply to foreign holding companies too?
Yes. Article 244 bis A explicitly reaches foreign entities. A Luxembourg SARL or a Jersey PCC whose underlying assets are predominantly French real estate falls within the same regime when its shares are sold by a non-resident.
How is the 50 per cent ratio computed?
At gross book value, not market value, and on the assets held by the company on the sale date or at any point in the previous twelve months. Real estate held through a subsidiary counts proportionally, via a transparency mechanism, so interposing a layer does not break the characterisation.
Does the 5 per cent stamp duty fall on buyer or seller?
The buyer bears the 5 per cent registration stamp on the share price. It is additional to the CGT and social charges borne by the seller, and it is one reason share deals on SPI entities are not as buyer-friendly as they look on paper.
Can a SPI characterisation be reversed before a sale?
In theory, by rebalancing the asset mix so real estate falls below 50 per cent. In practice, the twelve-month look-back neutralises last-minute portfolio shifts, and aggressive rebalancing is a textbook abuse-of-rights flag.