BUSINESS TAXATION

Corporate taxation

French or foreign companies operating in France are in principle subject to tax on their profits in France.

When supplying goods or services, they are in principle subject to VAT.

Finally, they are also liable for various taxes such as "contribution économique territoriale" (CET), "cotisation foncière des entreprises" (CFE), "taxe sur les salaires" (TS) and "taxe sur les véhicules de sociétés" (TVS).

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Whether in a purely national, cross-border or international context, our firm advises its clients on tax issues related to:

• Acquisitions, takeovers, mergers, demergers, partial contributions of assets, and more generally any restructuring operation

• Analysis and implementation of systems to reduce the taxation of financial flows between companies belonging to the same group, whether these flows originate from distributions, borrowings, sale of assets...

• Acquisition and structuring of business real estate

Our firm also assists its clients in the implementation of alternative remuneration schemes for their managers and employees, whether this involves giving them an interest in the development of the company's business in the form of management packages or encouraging employee shareholding by developing shareholding plans in the form of conditional allocations of free shares or purchase options.

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VAT is essentially characterized as a general tax on consumption which applies to the supply of goods and services in France. Tax liability is determined by the nature of the transactions carried out or the products concerned, independently of the personal situation of the taxable person or his customer.

VAT is calculated in such a way that, at the end of the economic circuit that makes the goods or services available to the purchaser, the tax burden corresponds to the tax calculated on the final selling price charged to the purchaser.

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For some operations, determining the applicable VAT rules can be quite complex, especially when they involve operators located in different countries or e-commerce transactions

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Within the European Union, the rules contained in the regulations and directives have over time been transposed into the domestic law of the twenty-seven Member States to form a harmonized and uniform indirect tax system applicable to the domestic consumption within the European territory. As Switzerland is not a member of the European Union, it must in principle be considered as a third State for the application of the VAT rules and transactions carried out with operators located in this State are therefore subject to specific rules. .

Given the difficulties that companies may encounter in some of their operations, our firm assists its clients in order to secure the applicable VAT rules in the context of complex operations, whether they take place in a purely national, cross-border or international context.

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In domestic law, Article 57 of the French Code Général des Impôts (CGI) authorises the Administration to adjust, under the control of the courts, the results declared by French companies subject to income tax or liable to corporate tax, that are dependent on or control companies located outside France. At the international level, some tax treaties also contain provisions similar to those of article 57 of the CGI.

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In order to make these adjustments, the tax authorities must demonstrate not only that the French company is dependent on a foreign company or has control over it, but also that the transactions subject to adjustment constitute an indirect transfer of profits abroad that is not part of the company's normal management.

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These indirect transfers of profits may in particular be carried out by means of:

• Increase or decrease in purchase or sale prices

• Payment of excessive or unrequited royalties

• Granting of interest-freee or low-interest

• Debt remission

• Granting of advantages out of proportion to the services obtained

To prevent these difficulties or within the framework of a tax audit, our firm assists and advises its clients on the methods used to determine transfer prices between the entities of their group.

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On a purely international level, we advise our clients on operations linked to the transfer of their headquarters, the relocation of all or part of their business or their shareholding abroad, via the creation of subsidiaries, branches or pure or animating holding companies.

Our firm defends its clients in the context of audits carried out against them by the tax authorities, as well as in the context of amicable procedures for the elimination of double taxation provided for in international convention