The third “corrective” Finance Bill for fiscal year (FY) 2020 proposes a new measure as support French companies in response to the coronavirus (COVID-19) pandemic—an accelerated refund of “carryback receivables” as well as a specific procedure for obtaining the immediate refund of any carryback receivable derived during the COVID-19 crisis.
Tax losses incurred during a given fiscal year may, upon election and under certain conditions, be used to reduce the tax liability of the preceding fiscal year, and are in turn converted into a "receivable" against the French government (up to a ceiling of €1 million in tax base)—hence, the term “carryback receivables” refers to such losses.
In principle, these loss receivables are either:
French companies subject to corporate income tax, under standard conditions, would benefit from an accelerated refund of the carryback receivables, as follows:
This new refund mechanism is proposed as part of the third corrective Finance Bill for 2020, and is scheduled to be discussed in Parliament beginning 29 June 2020 and then expected to be subject to a parliamentary vote in early July 2020. Observers anticipate that few or no changes would be made during the parliamentary process.
For more information, contact a tax professional with KPMG Avocats in France:
Marie-Pierre Hôo | + 33 (0) 1 55 68 49 09 | firstname.lastname@example.org
Patrick Seroin | + 33 (0) 1 55 68 48 02 | email@example.com
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.