The French Constitutional Court (Conseil Constitutionnel) held that “exceptional surcharges” to the French corporate income tax—to be imposed on the largest companies—are constitutional, thus finalizing implementation of the tax levy.
The exceptional surcharges apply to French companies or branches subject to corporate tax, and having gross revenue exceeding €1 billion. For French corporate tax groups, the €1 billion threshold will be applied at the level of the French tax group.
Read more about the surcharges as proposed in TaxNewsFlash-Europe
As regards French branches of foreign companies, and contrary to what had been expected, the revenue thresholds (described above) for both the exceptional and the additional contributions will apply at the French-level only. In other words, a French branch with French revenue below the threshold amounts will not be subject to the surcharges, even if the global revenue of the concerned foreign company exceeds the thresholds.
Conversely, a French company with foreign branches will be subject to the surcharge levies only if its French revenue (excluding that of its foreign branches) exceeds the application thresholds.
A provisional payment equal to 95% of the expected surcharge must be made at the date of payment of the last corporate tax installment, at the latest on December 20 for companies closing their financial years between December 31, 2017, and February 19, 2018.
For more information, contact a tax professional with Fidal* in France or with KPMG in the United States:
Gilles Galinier-Warrain | +33 1 55 68 16 54 | firstname.lastname@example.org
Patrick Seroin | +1 (212) 954-2523 | email@example.com
* Fidal is a French law firm that is independent from KPMG and its member firms.
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