Corporate income tax: IS rates, returns and procedures

Just like individuals who are subject to income tax, legal entities such as companies incorporated in the form of a company are subject to corporate income tax. The definition of this form of taxation, the companies concerned, the calculation of the tax rate and the formalities of the return… Focusing on the taxation of companies established as a company.

Capital Video: Corporate tax: everything you need to know about IS


– Is: what you need to know

Corporate tax: definition

Corporation tax is a tax levied on the profits made in France during the financial year to which it relates to companies incorporated and carried on as a company, whether French or foreign. It is abbreviated “IS” and selected by the state. Its basis is the industrial and commercial profits of companies for a given financial year.

Which companies does IS apply to?

Corporate income tax is mandatory for some businesses, but optional for others. Whether IS taxation is mandatory or optional is determined by the form of the company.

Companies are automatically subject to IS

Many types of businesses are subject to corporation tax. We are looking for:

  • SA (limited liability company);
  • SARL (limited liability company);
  • SCA (company limited by shares);
  • SAS (simplified joint stock companies);
  • SEL (liberal practice company) and its single-member version SELARL;
  • Civil societies with activity
  • Professional associations (for their study and defense activity of the rights and interests of their members).

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Companies for which IS remains optional

On the other hand, corporate tax is optional for some companies. Here are which:

  • EIRL (Individual Limited Liability Company);
  • EURL (single member limited liability company);
  • An individual entrepreneur who decided to assimilate into the EURL;
  • SNC (General Partnership);
  • Joint ventures;
  • Some civil companies with commercial activities and companies de facto established.

Note down : companies subject to IS are also subject to apprenticeship tax.

Note down : young innovative companies are exempt from corporate income tax.

Also read: How to start a business?

Calculation of the corporate income tax rate

There are two corporate tax rates: the normal rate and the reduced rate.

Normal rate of IS

In 2023, the standard rate applicable to all companies is set at 25%. This rate does not take turnover into account. However, there is a reduced rate that applies to some companies.

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Reduced IS rate

In 2023, the reduced rate set at 15% will apply to companies (small and medium-sized) meeting the following two criteria:

  • Tax-free turnover of less than 10 million euros.
  • Share capital fully remitted and at least three-quarters in the hands of natural persons (or companies whose capital is three-quarters held by natural persons).

From 1 January 2023, this reduced rate of 15% applies to a share of profits not exceeding 42,500 euros. The portion of profit above this amount is taxed at the standard rate of 25%.

Note down : some companies must also pay a flat tax for network companies.

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SI statement: steps

Declaration and payment of corporate tax must be dematerialized and carried out by teletransmission and electronic payment.

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Make an annual statement of results

The procedure depends on the tax regime.

  • Companies subject to the real or simplified real regime are obliged to use the so-called EDI procedure (electronic data interchange). This is the transfer of results from the company’s accounting files, carried out through their accountant (if they themselves are an EDI partner or cooperate with an approved EDI partner) or a specialized service provider.
  • Companies subject to the micro-enterprise regime can declare their results through their subscriber area using the Electronic Form Interchange (EFI) method.

Pay corporate income tax

Payment must also be made electronically. It is carried out in the form of payment of four installments, the amount of which depends on the results of the last accounting period closed on account statement No. 2571. The deadline for the payment of installments varies depending on the closing of the accounting year.

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To pay the IS balance, the company must use balance #2572.

Note down : the deadline for payment of the balance depends on the closing date of the accounting year:

  • Accounting year ending December 31 of year N-1: deadline May 15 of year N.
  • In the case of closing during year N, limit the 15th day of the 4th month after closing.

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