Pursuant to the provisions of the French Law on Tax Procedures (Livre de Procédure Fiscale or “LPF”), the French Tax Authorities may reject a tax claim either explicitly or tacitly, the latter being understood as occurring once a six-month period has elapsed from the filing date without a decision having been issued.
In practice, such a difference is relevant since, under French law, there is no deadline to file an appeal against a tacit rejection before the administrative tax court (Tribunal Administratif). Conversely, where a claim has been explicitly rejected by the Tax Authorities, the claimant must file an appeal before the administrative tax court within two months.
Development and news
The applicability of the abovementioned rules to tax claims became uncertain after the publishing of Decree no. 2016-1480 from 2 November 2016. The Decree modified article R421-3 of the Administrative Justice Code (Code de Justice Administrative), extending the two-month appeal deadline to all claims, not only those explicitly rejected. The new rules entered into effect on 1 January 2017.
In spite of this amendment, the fact remains that, according to French law, tax appeals are subject to the specific provisions of the French LPF and not to the provisions of the Code de Justice Administrative. Hence, it became a subject of debate whether the new rules enacted by Decree no. 2016-1480 should be understood as also encompassing tax appeals.
In this sense, the French administrative Supreme Court (Conseil d’État) clarified the issue in its decision from 7 December 2016 in case no. 384.309 - EURL Cortansa. In said decision, the Court confirmed that tax appeals remain subject to the provisions of the LFP and, as such, are not affected by the new rules brought forth by Decree no. 2016-1480.
The way forward
According to the decision of the French administrative Supreme Court, the applicable rules regarding tax reclaims will be the following:
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