2013 Tax Data

An Expert's View about Consumption/VAT/Sales Tax in France

Posted on: 19 Jun 2013

A synthetic ready to print leaflet about the main taxation rules in force in France in 2013

INHERITANCE AND GIFT TAXES TRANSFER OF BUSINESS (gift and inheritance) Principles : Exemption of inheritance (or gift) taxes in the limit of 75% of the shares Inheritances and gifts in direct line of descent : or assets allocated to the running of firms («Pacte Dutreil») and of 75% of the value of the individual firms. Par Common conditions :t of the net taxable amount in F Applicable rate • To carry on an industrial, commercial, traditional, agricultural or liberal activity, •To act as a manager for the associated donor heir(s) or member(s) of the company during not exceeding 8.072 F 5% the next 3 years after the death (or running of an individual firm). between 8.072 F and 12.109 F 10% •To commit individually and after the death to keep the shares or the goods for a period of time of 4 years or running of an individual firm. between 12.109 F and 15.932 F 15% Specific conditions of the «Pacte Dutreil» : between 15.932 F and 552.324 F 20% •To commit collectively and before the death (or the gift) to keep the shares for between 552.324 F and 902.838 F 30% a period of time of 2 years (minimum shareholding : listed companies 20%, non listed companies 34%), between 902.838 F and 1.805.677 F 40% over 1.805.677 F 45% DIVISION OF A PROPERTY’S ATTRIBUTES Age of usufructuary Value of usufruct Value of bare Inheritance between spouses and partners of a PACS : total exemption Less than 20 90 % 10 % From 21 to 30 80 % 20 % Gifts between spouses and partners of a PACS From 31 to 40 70 % 30 % From 41 to 50 60 % 40 % Part of the net taxable amount in F Applicable rate From 51 to 60 50 % 50 % From 61 to 70 40 % 60 % TAX DATA 2012 From 71 to 80 30 % 70 % not exceeding 8.072 F 5% From 81 to 90 20 % 80 % between 8.072 F and 15.932 F 10% More than 91 10 % 90 % FRANCE between 15.932 F and 31.865 F 15% LEGAL DEVOLUTION between 31.865 F and 552.324 F 20% between 552.324 F and 902.838 F 30% IN THE PRESENCE OF between 902.838 F and 1.805.677 F 40% over 1.805.677 F 45% One or more common 1/4 in full property or the whole children in usufruct Inheritance and gift between sisters and brothers One or more non common 1/4 in full property children Part of the taxable amount in F Applicable rate Father and mother 1/2 in full property Father or mother 3/4 in full property Not exceeding 24.430 F 35% Brothers and sisters 1/2 of “family propertie” and totality of the rest of inheritance property Over 24.430 F 45% Nephews and nieces Totality of inheritance property Applicable allowances PARTNER’S RIGHT IN THE CASE OF A GIFT BETWEEN SPOUSES JPA INTERNATIONAL The allowances on inheritance taxes apply by periods of 10 years. - On the share devolving to the spouse or partner (P.A.C.S.) : 80.724 F (gift) IN THE PRESENCE OF - On the share devolving to each relative in the ascending line and to 7, rue Galilée 1/2 in full property or 1/4 in full property One common child each child alive or represented : 159.325 F and 3/4 in usufruct 75116 PARIS - On the share of each grandchild : 31.865 F (gift) 1/3 in full property or 1/4 in full property Two common children T : + 33 1 49 52 43 00 - On the share of each great grandchild : 5.310 F (gift) and 3/4 in usufruct Three common children 1/4 in full property and 3/4 in usufruct - Between sisters and brothers : 15.932 F F : + 33 1 47 20 32 79 1/2 in full property or 1/4 in full property One non common child - In case of gift from uncle and aunt to nephew and niece : 7.967 F and 3/4 in usufruct or the whole in usufruct M : jpa@jpa.fr - Reduction in case of gift of a company shares 1/3 in full property or 1/4 in full property Two non common children and 3/4 in usufruct or the whole in usufruct W : www.jpainternational.com 1/4 in full property and 3/4 in usufruct or 50% if gift in full property of shares Three non common children the whole inusufruct of a company or a sole proprietorship Totality of inheritance property excepted having an industrial, commercial, craft, Father and/or mother Donor under 70 the right of return on “family property” agricultural or liberal activity. given The shares must have been dealt under Brothers and sisters or Totality of inheritance property without the « Pacte Dutreil ». nephews and nieces exception DIRECT TAXES VALUE ADDED TAX u Tax on Income : u Real estate and tangible assets gains u Value added tax (in mainland France) : • Progressive rate from 0 to 41 % (in 5 bands). • 19 % (+13.5%). • Reduced rates : 5.50% and 7% • A special contribution on high incomes has been created: between • Progressive allowance for holding duration of buildings (30 years • Standard rate : 19.60% 3% of the bracket > 250.000 F and < 500.000 F, and 4% for the part for a total exemption). • Specific rate : 2.10% > 500.000 F threshold doubled for a couple). u Deductions or levies for physical persons not domiciled in France u Contributions and social levies : REGISTRATION DUTIES (subject to application of international agreements) : • 8.2% general social benefit levy (CSG), 0.5% • 0%, 12% or 20% : wages and salaries, pensions and life annuities • Social welfare system levy (CRDS). SALE OF REAL ESTATE (artists and athletes : 15%). • Complementary 3.4 % Social levy on income from real estate and • 33% : profits not from trade or business. securities • Additional taxes : 0.3%. • 25% : dividends (except E.U. : 19%). u Standard rate : 5.09% • Active solidarity income (RSA) : 1.1%. • 19% : real-estate capital gains or profits for E.U. residents. • 33 1/3% : real-estate capital gains or profits for non E.U. residents. SALE OF BUSINESS AND CLIENTELE u Corporation tax : • Rate 15% under certain conditions, up to a maximum income of ‚ Contributions for French tax residents. 38.120 F (for companies with a turnover of less than 7.630.000 F Part of the price in F Rate and held at 75% by individuals). REGIONAL ECONOMIC TAX • Rate 33.33%. Not exceeding 23.000 F 0.00% (CONTRIBUTION ECONOMIQUE TERRITORIALE) • A contribution of 3.3% on the part Corporation Tax > 763.000 F. Between 23.000 F and 200.000 F 3.00% • A special contribution of an additional 5 % for turnovers > to 250 Over 200.000 F 5.00% million Euros. CET u Tax on wages and salaries : CFE CVAE • For employers not registered for VAT, rate is 4.25% (8.50% and TAXES AND LEVIES APPLICABLE TO COMPANIES 13.60% for that part of individual salaries above 7.604 F and Property rental value x Rate Added value x Rate* 15.185 F per year). taxation from the town * reduced in the following conditions : u Contributions in return for equity : u Apprenticeship levy : Exemption for companies subject to corporate tax, except property, If CA < 152.500 F Exemption • 0.50% of wages and salaries plus an additional surcharge on These data come under the business good-will, lease premiums. If 152.500 F < CA < 500.000 F Rate = 0 wages and salaries : 0.18% and an additional contribution on the competent regional If 500.000 F < CA < 3.000.000 F Rate = 0 to 0.5 % u Contributions in return for equity of property, business good-will, apprenticeship with a variable rate (0.05% to 0.3%) for the companies authorities If 3.000.000 F < CA < 10.000.000 F Rate = 0.5 to 1.40 % customers, lease premiums, made by a corporate entity liable to with 250 employees and more that have not reached the threshold of 4% of apprenticeship contracts. If 10.000.000 F < CA < 50.000.000 F Rate = 1.40 to 1.50 % corporation tax, by a person or entity not so liable : If sales > 50.000.000 F Rate = 1.50% Exemption for such assets (goodwill and property) included in the u Professional training levy : overall contribution to a company if the contribution undertakes to • Undertakings with at least 20 employees : 1.60% of wages and Ceiling : CET% ≤ 3% x VA keep his shares for 3 years. salaries. • Undertakings between 10 to 19 employees: 1.05% of wages and CET : Contribution Economique Territoriale (Regional Economic Tax) u Other contributions : Transfer duties based on the nature of contribution. CFE : Cotisation Foncière des Entreprises (Firms Land Tax) salaries. CVAE : Cotisation sur la Valeur Ajoutée des Entreprises (Firms Added V u Increase in share capital, merger, demerger, partial merger :alue Tax) • Undertakings with less than 10 employees : 0.55% of wages and CA : Chiffre d’Affaires (Turnover) salaries, or a contribution of 2%. 375 F or 500 F based on the capital (exept property, business good- VA : Valeur Ajoutée (Added Value) will, leases premiums). u Compulsory housing fund levy : • Undertakings with at least 20 employees : 0.45% of wages and u Sale of equity : salaries. WEALTH TAX (I.S.F.) • Companies predominately engaged in real-estate holding : 5%. u Deduction or levies on income from securities : • Civil Societies, SNC, SCS, Ltd. : 3% after reduction of 23.000 F. • 24% : deduction at source of tax due on fixed income securities, Net taxable value Applicable rate • SCA, SA, SAS : 3% under 200.000 ?, 0,5% between 200.000 ? and plus 13.5% social levies. Between 1.300.000 F and 3.000.000 F 0.25% of all the 500.000.000 ?, and 0.25% over 500.000.000 ?. u Dividends : st patrimony from the 1 Euro • France residents : option of applying deduction at source of 24% u Sale of patents : fixed fee of 125 Euros. Over 3.000.000 F 0.50% of all the (+13.5%), or use of the progressive reckoner by income group st patrimony from the 1 Euro including deductions. • E.U. residents : payroll deduction of 19%. TAX SHIELD • For subsidiaries held at least at 5% for more than 2 years : u Discount exemption of 95% of dividends. u French residents can claim repayment of the surplus of total direct u Tax on realised corporate securities capital gains : Net taxable value Discount taxes (Income taxes, gain on security, payroll taxes, wealth tax (ISF) • Income tax : 19% + 13.5% social levy i.e. 32.5% in total Between 1.300.000 F and 1.400.000 F 24.500 - (7 x 0.25% x patrimony) (Retirement of SMEs managers owning o and local taxes paid in France) over 50% of the income.ver 25% under specific conditions : exemption of 19% but tax limited to 13.5% social levy). Between 3.000.000 F and 3.200.000 F 120.000 - (7,5 x 0.5% x patrimony) • If investments : 0% but reintegration of the general expens equal to 10% of part of the profit and realised capital gains.
Posted: 19 June 2013

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