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France

Taxes

If you want to start your business venture in France, this article will educate you on the tax laws for a JSC (SAS) which is the most common company structure in France.

France taxes corporate French-source income. Income accrued outside French, from our research, but seek professional advice, is not taxable until is not repatriated to France. Therefore, undistributed profits of foreign subsidiaries or P.E. are not taxable, unless CFC rules apply. Taxes are high in France as the current highest corporation tax rate is 33.33%, which will be progressively reduced to 28% over the period 2017 to 2020. For 2017, SMEs are subject to a reduced tax rate of 28% on taxable income up to €75,000 and 33.33% on the excess. A surtax of 3.33% may apply to certain companies whose income tax liability exceeds €763,000, resulting an effective tax rate of 34.43%. France ranks 166th overall with regards to corporate tax rate worldwide.

The VAT rate in France is 20.00%, that ranks France as 134th when compared to VAT globally. In terms of other taxation, an employer will contribute 45% to the equivalent of a social security fund and an employee will contribute 23%. The overall complexity of the tax system is medium. This is measured by average time to comply with a country's labor tax requirements is as it is 80hours. Contributing to this is the number of yearly labor tax payments, which is 2 in FR.

Thin cap rules are in play. Thin capitalisation refers to any type of laws on given company with respect todebt-to-asset ratios. Dividends received are usually subject to Corporate Income Tax. A 95% exemption may apply, if recipient owns at least 5% of shares of the distributor for at least two years, resulting an effective tax rate of 1.72%. Dividends are distributions of earnings of the legal entity, established by the board, to shareholders. Dividends can be issued as stock, cash, or property. Capital Gains are subject to Corporate Income Tax. However, a 88% exemption may apply for those gains from the sales of shares, if the shares have been held more than two years, resulting an effective tax rate of 4.13%. A capital gains tax is levied on the profits that a corporation or natural person realizes when they sell sells a capital asset for a price that is higher than the purchase price.

Dividends paid to non-residents are subject to a withholding tax of 30% plus a surtax of 3.33%, unless rates are reduced under a tax treaty or the EU parent-subsidiary directive applies. The surtax may not apply for tax-consolidated groups. Interests paid to non-residents are not generally subject to withholding tax. Royalties remitted abroad are subject to a withholding tax of 33.33%, unless rates are reduced under a tax treaty or the EU royalties directive apply. Payments to residents of considered non-cooperative jurisdictions are subject to withholding taxes of 75%.

There is a capital duty applied on most transactions affecting a company's share capital. There is a tax on individual's net wealth in France. There are real estate and inheritance taxes in France. Transfers of immovable property are also taxed. There are frequently implemented credits for innovation spend that include breaks on taxation here.

The above is not tax or legal advice for your individual situation. Incorporations.io can point you to an expert in France who will advise you. Want to work together? Click incorporate now if you are in a hurry, or press the free consultation button above.

Country details

France
EUR
Paris
Europe
fr-FR, frp, br, co, Catalan, Basque, oc
64,768,389

Tax treaties

Country Type Date Signed
Central African Republic DTC  1969-12-31
San Marino TIEA 2009-09-22
Lebanon DTC  1962-07-14
Saint Kitts and Nevis TIEA 2010-04-01
Curaçao TIEA 2010-09-10
Jamaica DTC  1995-08-09
Mexico DTC  1991-11-07
Israel DTC  1995-07-31
Costa Rica TIEA 2010-12-16
Antigua and Barbuda TIEA 2010-03-26
Albania DTC  2002-12-24
Liechtenstein TIEA 2009-09-22
Bosnia and Herzegovina DTC  1974-03-28
Jersey TIEA 2009-03-23
Niger DTC  1965-06-01
Brunei Darussalam TIEA 2010-12-30
Kenya DTC  2007-12-04
Ireland DTC  1968-03-21
Syrian Arab Republic DTC  1998-07-17
Norway DTC  1980-12-19
Switzerland DTC  1966-09-09
Belgium DTC  1964-03-10
Bulgaria DTC  1987-03-14
Croatia DTC  2003-06-19
Tunisia DTC  1973-05-28
Saint Vincent and the Grenadines TIEA 2010-04-13
Anguilla TIEA 2010-12-27
Estonia DTC  1997-10-28
Indonesia DTC  1979-09-14
Netherlands DTC  1973-03-16
Cameroon DTC  1976-10-21
Qatar DTC  1990-12-04
Isle of Man TIEA 2009-03-26
Saint Lucia TIEA 2009-04-01
Algeria DTC  1999-10-17
Lithuania DTC  1997-07-07
Romania DTC  1974-09-27
Hong Kong, China DTC  2010-10-21
Ukraine DTC  1997-01-31
Azerbaijan DTC  2001-12-20
Vanuatu TIEA 2009-12-31
Singapore DTC  1974-09-09
China DTC  1984-05-30
Ecuador DTC  1989-03-16
Malawi DTC  1950-12-14
Gabon DTC  1995-09-20
Nigeria DTC  1990-03-27
Botswana DTC  1999-04-15
Sint Maarten TIEA 2010-09-10
Libya DTC  2005-12-22
Oman DTC  1989-06-01
Greece DTC  1963-08-21
Malaysia DTC  1975-04-24
Cook Islands TIEA 2010-09-15
Mauritania DTC  1967-11-15
Canada DTC  1975-05-02
Cyprus DTC  1981-12-18
Austria DTC  1993-03-26
India DTC  1992-09-29
Sri Lanka DTC  1981-09-17
Grenada TIEA 2010-03-31
Mali DTC  1972-09-22
Benin DTC  1975-03-27
Saudi Arabia DTC  1982-02-18
Jordan DTC  1984-05-28
Thailand DTC  1974-12-27
Côte d'Ivoire DTC  1966-04-06
Gibraltar TIEA 2009-09-22
Luxembourg DTC  2006-11-24
Finland DTC  1970-09-11
Turkey DTC  1987-02-18
Iran DTC  1973-11-07
Portugal DTC  1971-01-14
Latvia DTC  1997-04-14
Russian Federation DTC  1996-11-26
Namibia DTC  1996-05-29
Slovakia DTC  1973-06-01
Zimbabwe DTC  1993-12-15
Pakistan DTC  1994-06-15
Former Yugoslav Republic of Macedonia DTC  1999-02-10
Germany DTC  1959-07-21
Brazil DTC  1971-09-10
Poland DTC  1975-06-20
Venezuela DTC  1992-05-07
Armenia DTC  1997-12-09
Bolivia DTC  1994-12-15
Dominica TIEA 2010-12-24
Bangladesh DTC  1987-03-09
Hungary DTC  1980-04-28
Chile DTC  2004-06-07
Philippines DTC  1976-01-09
Serbia DTC  1974-03-28
Trinidad and Tobago DTC  1987-08-05
Australia DTC  2006-06-20
United States DTC  1994-08-31
Aruba TIEA 2011-11-14
Japan DTC  2007-01-11
Slovenia DTC  2004-04-07
Belize TIEA 2010-11-22
Viet nam DTC  1993-02-10
United Arab Emirates DTC  1989-07-19
Malta DTC  1977-07-25
United Kingdom DTC  2008-06-19
Mauritius DTC  1980-12-11
Guernsey TIEA 2009-03-24
Iceland DTC  1990-08-29
Burkina Faso DTC  1965-08-11
Monaco DTC  1963-05-18
Italy DTC  1989-10-05
Kazakhstan DTC  1998-03-03
Ghana DTC  1993-04-05
Bermuda TIEA 2009-10-08
Panama DTC  2011-06-30
Montenegro DTC  1974-03-28
Kosovo DTC  1974-03-28
Uzbekistan DTC  1996-04-22
Czech Republic DTC  2003-04-28
Togo DTC  1971-11-24
South Africa DTC  1993-11-08
Uruguay TIEA 2010-01-28
Guinea DTC  1999-03-15
Bahamas, The TIEA 2009-12-07
Korea, Republic of DTC  1979-06-19
Bahrain DTC  1993-05-10
Sweden DTC  1990-11-27
Morocco DTC  1989-08-18
Turks and Caicos Islands TIEA 2009-09-24
Zambia DTC  1950-12-14
Senegal DTC  1974-03-29
Madagascar DTC  1983-07-22
New Zealand DTC  1979-11-30
Liberia TIEA 2011-01-06
Cayman Islands TIEA 2009-10-05
Georgia DTC  2007-03-07
Mongolia DTC  1996-04-18
Spain DTC  1995-10-10
Egypt DTC  1999-05-01
Kuwait DTC  1994-01-27
Andorra TIEA 2009-09-22
Argentina DTC  1979-04-04
Ethiopia DTC  2006-06-15

Tax treaties Map

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Disclaimer

Although we use our best efforts to keep the information of this site accurate and up-to-date, we make no representations or warranties with respect to the accuracy, applicability, fitness, or completeness of the contents of this website. We disclaim any warranties expressed or implied, merchantability, or fitness for any particular purpose. We shall in no event be held liable for any loss or other damages, including but not limited to special, incidental, consequential, or other damages. The contents of this website are just for illustrative purposes and are NOT to be considered as a legal opinion or tax advice and should not be relied upon as such. Far Horizon Capital Inc., and any associated company, is not engaged in the practice of law or tax. If you wish to receive a legal opinion or tax advice on the matter(s) in this website please contact our offices and we will refer you to an appropriate legal practitioner. Use of our websites FlagTheory.com, Incorporations.io, Residencies.io, Passports.io, is subject to our terms and conditions.

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