TLDR: There is no general exemption for compensation received by avoués after the merger. The compensation for the loss of the droit de présentation (right to propose a successor to the garde des Sceaux) is taxable under the capital gains tax regime for professionals, except in two cases: deferred taxation (optional, for avoués who are members of an SCP) and the exemption provided by Article 151 septies A of the French Tax Code (CGI) for avoués retiring before 31 December 2012.
Basic tax regime: taxation as professional capital gains
The compensation paid to avoués for the loss of the droit de présentation is taxable under the professional capital gains regime. This principle applies systematically, except where expressly provided for by law.
Deferred taxation for members of an SCP
Avoués practising within a société civile professionnelle (SCP) may, upon request, benefit from deferred taxation (full or partial) of the capital gain related to the compensation. This measure aims to avoid taxation on an amount exceeding their actual enrichment. The deferral is not automatic: it must be explicitly requested.
Exemption for retiring avoués
Article 151 septies A of the CGI provides a specific exemption for avoués who cease their activity to retire. This exemption applies to avoués who ceased their activity as of 1 January 2012 and who opted for this regime. The law extended the deadline for exercising retirement rights until 31 December 2012, thus allowing the exemption to be claimed within this timeframe.
No general exemption
There is no general exemption for all compensation received by avoués following the merger. Taxation is the rule, and the only exceptions are deferred taxation (for SCP members) and the retirement exemption (subject to date and option conditions).
Declaration obligations
Avoués must declare the compensation received for the loss of the droit de présentation under the professional capital gains regime, unless they opt for deferred taxation or qualify for the retirement exemption.
Limits and conditions
- Deferred taxation is reserved for avoués who are members of an SCP and requires an explicit request.
- The retirement exemption is limited to avoués who ceased their activity as of 1 January 2012 and who opted for the regime under Article 151 septies A of the CGI.
- No other exemptions are provided for compensation related to the merger.