The purchase price of securities acquired through a distribution in kind is equal to the amount of dividends distributed

A Swedish company sold the shares it held in a French company without filing a declaration and without paying the withholding tax provided for in Article 244 Bis B.

administration that the Swedish company had realized a capital gain on this sale, issued a tax assessment against the company. In particular, they held that the acquisition cost of the shares to be used in calculating the capital gain should reflect capital increases and the amount of a distribution in kind.

Before the Administrative Court of Appeal, the company argued that, in determining the purchase price, the actual value of the securities acquired should be used rather than the amount of the distribution.

The Administrative Court of Appeal subsequently ruled that, in the case of a distribution of securities in kind, the acquisition cost to be used for calculating the capital gain upon the sale of such securities corresponds to the amount of dividends distributed and not to the actual value of the securities.

This will confirm theadministration's recovery.

CAA Paris, Oct. 20, 2025, No. 24PA00354

This legal watch provided by Mispelon Avocat, a law firm specializing in French tax audit and French tax litigation. You can stay legal watch subscribing to the newsletter via this link.