Tax policy directorate – Bureau a

PART I: 
TAXES ON INCOME 
There are four categories of taxes on income in France: 
• 
corporation tax (impôt sur les sociétés, IS) 
• 
personal income tax 
• 
social levies 
• 
payroll taxes 

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CHAPTER 1: 
CORPORATION TAX 
Corporation tax is a tax, in principle payable annually, on all profits generated in France by companies 
and other legal entities. It concerns about a third of French companies. Legal entities may be liable to 
corporation tax: 
• 
At the standard rate of 33
⅓
% for all their activities. A rate of 28% will apply to:
- Small and medium-sized enterprises (SMEs) for profits up to €75,000 for tax years beginning 
on or after 1 January 2017 
- All taxpayers for profits up to €500,000 for tax years beginning on or after 1 January 2018 
- All taxpayers, with no cap on profits provided their turnover does not exceed €1 billion, for tax 
years beginning on or after 1 January 2019 
- All taxpayers with no caps on turnover or profits, for tax years beginning on or after 1 January 
2020
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• 
At the reduced rate of 15% for SMEs on the portion of profits up to €38,120. This reduced rate 
is reserved for companies with turnover excluding VAT of less than €7,630,000 over the tax 
year or tax period, reduced where relevant to twelve months. The company's capital must be 
fully paid-up and at least 75% must be held continuously by individuals or by a company 
meeting the same conditions (turnover, paying-up and holding capital). For the parent 
company of a group as stipulated in Article 223 A of the French General Tax Code (Code 
Général des Impôts, CGI), turnover is the sum of the turnover of each company in the group. 
For tax years beginning on or after 1 January 2019, this reduced rate of 15% will be extended 
to SMEs whose turnover is less than €50 million.
1
• 
Or at the following special rates:
- 
0%
2
for long-term capital gains resulting from the disposal of participating interests held for 
at least two years 
- 
0%
3
or 15% for asset allocations or redemptions of securities carried out, under certain 
conditions, by “tax” venture-capital investment funds and venture-capital companies, and 
for long-term capital gains resulting from the disposal of units in these venture-capital 
investment funds and shares in these venture-capital companies, when the seller company 
has held these units or shares for at least five years 
- 
15% for income from granting licences to use patents, patentable inventions or 
developments thereto, or for certain industrial manufacturing processes and capital gains 
from the disposal of such items, and, under certain conditions, for income from granting 
sub-licences to use said items 
1
Article 11 of the 2017 Budget Act no. 2016-1917 of 29 December 2016. 
2
Subject to adding back a proportion of expenses and costs. 
3
Subject to adding back a proportion of expenses and costs. 

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- 
19% for long-term capital gains resulting from the sale of securities of listed companies 
investing predominantly in property (sociétés à prépondérance immobilière, SPI), when the 
seller company has held these securities for at least two years 
- 
19% for net capital gains booked for the sale of premises used as offices or for commercial 
purposes, which are scheduled to be reconverted into housing units within four years 
(arrangements applying to sale transactions for valuable consideration carried out by 31 
December 2017) 
- 
10%, 15% or 24% for the income from assets received by non-profit organisations 
Furthermore, there are three additional corporate surtaxes and levies:
• 
A one-off and temporary levy, equal to 10.7% of the corporation tax calculated on taxable 
profits, was introduced by the fourth 2011 Supplementary Budget Act and extended by the first 
2014 Supplementary Budget Act.
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This additional levy is owed by major companies that record 
turnover excluding VAT of more than €250 million for the financial years ending between 31 
December 2011 and 30 December 2016.
• 
A 3% corporate surtax is owed on amounts that French and foreign companies and 
organisations liable to corporation tax in France distribute to their partners, shareholders or unit 
holders. The surtax applies to amounts distributed as from 17 August 2012;
• 
In addition, corporation tax payers whose turnover excluding VAT is €7.63 million or more are 
liable to a social contribution5 equal to 3.3% of the tax assessed on their taxable profits at the 
standard rate and at the reduced rates, minus relief that may not exceed €763,000 per twelve-
month period.
The tax yielded €33.5 billion in 2015.
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