Contribution-sale scheme: 70% of the sale proceeds to be reinvested within three years and five-year holding period

Article 11 of the 2026 budget act tightens the conditions for the tax deferral on gains from contributing shares to a company controlled by the contributor (Article 150-0 B ter of the General Tax Code) where the company sells the shares within three years: it must reinvest at least 70% of the proceeds (instead of 60%) within three years (instead of two) in eligible activities, now defined by reference to the IR-PME activities, and hold the acquired assets or shares for at least five years. Holding companies exclusively holding interests in eligible companies are accepted for reinvestment. Where the contributed shares are donated, the donee must now hold them for six years instead of five (eleven instead of ten where the reinvestment was made through funds) to avoid taxation of the deferred gain.