The French Law on Combating Social Security and Tax Fraud introduces new compliance requirements for entities benefiting from the exemption from the annual 3% tax on French real estate holdings.

The main change is the abolition of the disclosure commitment mechanism. Entities can no longer rely on a simple undertaking to provide ownership information upon request. To maintain the exemption, they must now file an annual 3% tax return (Form 2746-SD), with the first filing due by 15 May 2027 for entities previously relying on the disclosure commitment.

In addition, foreign entities without a permanent establishment in France that are subject to the reporting obligations must now appoint a French tax representative. This representative will be authorised to receive communications from the French tax authorities regarding the monitoring and enforcement of the 3% tax.

These measures are designed to strengthen transparency and enable the French tax authorities to more easily identify the ultimate beneficial owners of French real estate held through corporate structures.

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