Particularly likely to benefit from this scheme are
investments in hotels, buildings and equipment, buildings
intended exclusively for the purposes of hosting exhibitions
and conferences and the equipment used for these
buildings, as well as machinery and equipment used
for manufacturing operations, processing or transport.
Acceleration coefficients used for scientific and technical
research operations are increased by 0.25 points.
Allowable provisions for
These must be justified and relate to clearly identified
accounts, inventories, securities or tangible and intan-
Allowable provisions include provisions for contingencies,
claims, work in progress, paid leave, etc.
Low corporate tax rates:
10% or 20%
Corporate tax rates (Impôt sur les sociétés) are as follows:
for large companies: standard rate of 20%
for small and medium businesses (SMEs): a reduced
corporate tax rate of 10% up to €40,000 of profits and
a standard rate of 20% on the remainder
for gains derived from certain intangible fees (sale,
concession, sub-concession): 10% (see example on
intellectual property management companies)
for gains derived from financial securities giving access
to capital: 10% (see page 17).
Losses can be carried
Losses recorded during a given year may be carried
forward indefinitely and for unlimited amounts against
In addition to this very generous scheme, there is an
optional carry-back scheme that allows the current
year’s losses to be offset against taxable income in the
previous three years. This results in a claim against the
treasury for previously paid corporate tax.
This debt is repaid after 5 years if the company fails to
deduct it from their corporate tax bills in subsequent
Finally, the net taxable income at the reduced rate of
10% may optionally be used to offset the deficit for
the year and carry-forwards (subject to the standard
rate of 20%): deficits canceled in this way cease to be
carried forward. This compensation, which operates euro
for euro, is good for businesses that do not generate
sufficient taxable profits at the rate of 20% to be able
to offset their fiscal deficits.
Intended for SMEs that have at least 75% of their shares held directly or
indirectly by individuals, or for companies that satisfy the same conditions
and report an annual turnover of less than €7,630,000, subject to having
fully paid up share capital.
DOING BUSINESS IN SAINT-MARTIN