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 | email@example.com
Patrick Seroin | +1 (212) 954-2523 | firstname.lastname@example.org
* Fidal is a French law firm that is independent from KPMG and its member firms.
© 2018 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
KPMG International Cooperative (“KPMG International”) is a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.
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.